HomeInsightsNeed to Know – 2013.03.18

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General

Department for Business, Innovation and Skills publishes “Users Guide to the Recast Late Payments Directive”.

European Parliament approves new rules on Alternative Dispute Resolution and Online Dispute Resolution.

Ofcom publishes second wave of quarterly consumer research study into lawful and unlawful access and use of copyright-protected content online.

Technology

Body of European Regulators for Electronic Communications (BEREC) provides an update on its opinion on the Commission’s draft Recommendation on enhancing high-speed internet roll-out.

European Patent Office publishes recommendations for improving the patent system.

Home Office announces creation of new “Cyber Crime Reduction Partnership” to tackle the growing threat of organised and global cyber criminals.

European Court of Human Rights rules that “Pirate Bay” co-founders’ criminal conviction for assisting copyright infringement on the internet was justified.

Data Protection

Article 29 Data Protection Working Party highlights data protection issues relating to development and use of apps.

Broadcasting

Ofcom consults on spectrum pricing for terrestrial digital broadcasting.

Ofcom prepares for second phase of local TV licensing.

High Court refuses to prefer common law conspiracy to defraud charge against unlicensed streamer of Premier League matches.

Publishing

Deal agreed on press regulator

Sport

European Parliament passes Resolution calling for common penalties across the EU for match-fixing.

Gambling & Betting

Remote Gambling Association complains to European Commission about Greek Government’s plans to extend state-controlled gaming organisation OPAP’s land-based monopoly to online gambling products.

Advertising

Committee of Advertising Practice publishes Help Note on advertising on Video On Demand services.

European Commission announces plans to strengthen enforcement against unfair commercial practices.

ASA clears online clothing retailer Asos.com’s killer” internet video of irresponsible advertising despite appearing on non-age-gated YouTube.

General

Department for Business, Innovation and Skills publishes “Users [with no apostrophe] Guide to the Recast Late Payments Directive” (2011/7/EU).

Amended late payment legislation comes into force on 16 March 2013, implementing European Directive 2011/7/EU on combating late payment in commercial transactions. The aim is to make pursuing payment a simpler process across the EU, reducing the culture of paying late and making paying on time the norm.

According to the Government, the new rules are simple: debtors will be forced to pay interest and reimburse the reasonable recovery costs of the creditor if they do not pay for goods and services on time (60 days for businesses and 30 days for public authorities).

The guide has been prepared taking into account the responses to the transposition consultation that was held in Autumn 2012.

The statutory right to claim interest and other compensation recovery costs and entitlements being introduced from 16 March 2013 is not compulsory and it is for the supplier to decide whether or not to use the right made available.

The new measures include:

  • business to business payment terms: the period for payment fixed in the contract must not exceed 60 calendar days unless otherwise expressly agreed in the contract and provided it is not grossly unfair to the creditor;
  • public sector payment terms: in commercial transactions, where the debtor is a public authority, the payment period must not exceed 30 calendar days following receipt by the debtor of the invoice;
  • statutory interest rate: simple interest is calculated as equal to the sum of the Bank of England reference rate plus at least eight percentage points;
  • compensation for recovery costs: the creditor is entitled to obtain from the debtor a fixed charge of £40, £70 or £100 depending on the size of the debt (under £1,000, under £10,000, and higher), plus additional reasonable costs incurred;
  • application: contracts concluded before 16 March 2013 will be excluded from the amended provisions; and
  • verification periods: the maximum duration of a procedure of acceptance or verification must not exceed, as a general rule, 30 calendar days.  Nevertheless, it should be possible for a verification procedure to exceed 30 days where agreed and not grossly unfair to the creditor.

For a link to the new Guidance, click here.

European Parliament approves new rules on Alternative Dispute Resolution and Online Dispute Resolution.

The European Parliament says that, as a result of the vote on 12 March 2013, shoppers will get easier access to rapid, cheap and impartial mediation in disputes with traders over goods or services. 

The new rules on Alternative Dispute Resolution (ADR) and Online Dispute Resolution (ODR), aim to step up the use of ADR schemes in the EU by giving shoppers a fast, cheap and informal way to settle disputes with traders as an alternative to lengthy court proceedings.

Many EU countries already have ADR schemes, but a lack of common standards, patchy coverage and overloading make it hard for shoppers to use them, the Commission says.  The new Directive requires EU Member States to ensure that ADR bodies exist for all business sectors and includes provisions to ensure that mediators are impartial.

Shoppers will be able to use the new rules to seek out-of-court remedies for complaints about any good or service, whether bought online, in a shop, domestically or across borders.  MEPs ensured that arbitration should be either free of charge for the shopper or cost only a nominal fee.  The rules state that, in general, any dispute should be resolved within 90 days.

To help resolve disputes over goods sold online, the ODR Regulation empowers the Commission to provide an online platform for ODR in all EU languages. This platform, accessible via the Your Europe portal, will give shoppers a standard user-friendly complaint form that they can complete in their own language.

The ODR platform will refer shoppers to the most appropriate ADR scheme for their complaints.  It will be able to handle every step of a complaint online and information exchanged will be protected by EU privacy and data protection rules.  ODR help will be available for any dispute over online sales, irrespective of where the seller is located in the EU.

The ADR Directive and the ODR Regulation will enter into force 20 days after their publication in the EU Official Journal.  The ADR Directive should apply in all Member States within 24 months of its entry into force, and the ODR platform will be available shortly thereafter.

The ADR Directive was approved by 617 votes to 51, with five abstentions and the ODR Regulation was approved by 622 votes to 24, with 32 abstentions.  To read the European Parliament’s press release in full, click here.

Ofcom publishes second wave of quarterly consumer research study into lawful and unlawful access and use of copyright-protected content online.

The second wave of the study, carried out on Ofcom’s behalf by Kantar Media, showed that, overall, there were very few significant differences between the results of the second wave report and those of the first wave, which were published in November 2012.

Rather than focusing on one industry, the study looked at six main types of online content: music, film, TV programmes, books, video games and computer software and for each of these assessed levels of infringement.  These were then assessed within wider patterns of consumer behaviour and content consumption.

The vast majority of questions for the latest wave of research related to online behaviour during the period August to October 2012: respondents were asked about their activity during “the past three months”.  The first wave covered the period May to July 2012

As for general online behaviour, the only significant increase between wave 1 and wave 2 was streaming of TV programmes (up from 30% to 33% in the past three months).  Overall consumption of online content (including downloading) increased as a result from 32% to 35%.

The proportion of music consumers who consumed all their music for free fell from 54% to 46% in favour of the “mix of paid and free” group, which increased from 18% to 22%.  A higher proportion of eBook consumers paid for all of their books than they did in wave 1 (50% from 42%).

Consumer confusion about the legality of online activity declined since wave 1: 41% of all internet users aged 12 and over claimed to be either “not particularly confident” or “not at all confident” in terms of what is and is not legal online, down from 44% in wave 1.

As for levels of infringement, there were no significant changes since wave 1, with one in six (16%) UK internet users aged 12 and over estimated to have consumed at least one item of online content illegally between August-October 2012.  Around a third of these (5%) exclusively consumed illegal content.

Levels of infringement varied significantly by content type.  The survey indicated that 10% of internet users aged 12 and over consumed at least some music illegally over the three-month period, while 6% did so for films.  For video games and computer software the figure was 2%, while for eBooks it was just 1%.  Across all content types, infringers were generally more likely to be male and under 35.

Overall, volumes of illegal content consumed online varied by category.  Music was highest with 297 million tracks estimated to have been consumed illegally.  This was followed by TV programmes (56 million), films (44 million) and video games (35 million).  Illegal consumption of computer software (27 million) and books (8 million) was relatively lower.

The most common reasons cited for consuming content illegally were because it was free (50%), convenient (46%) and quick (43%). Factors that infringers said would encourage them to stop included the availability of cheaper legal services (30%), if it was clearer what was legal and what was not (25%), and if everything they wanted was available legally (24%).

Regarding the threat of a letter from their ISP, 18% of all infringers indicated that if their ISP sent them a letter saying they would suspend their internet access it would put them off, falling to 12% if their ISP sent them a letter saying they would restrict their internet access, and 11% if their ISP sent them a letter informing them that their account had been used to infringe.  For a link to the research study, click here.

Technology

Body of European Regulators for Electronic Communications (BEREC) provides an update on its opinion on the Commission’s draft Recommendation on enhancing high-speed internet roll-out.

At its first Plenary of 2013, BEREC agreed the headline messages of its opinion on the Commission’s draft Recommendation as far as cost orientation and non-discrimination are concerned.

BEREC reiterated its commitment to enhance the broadband investment environment across Europe, while continuing to promote competition.  BEREC says that it shares the Commission’s determination to ensure a “transparent, predictable, and stable regulatory environment in support of the roll out of NGA networks”.  On the basis of these shared objectives, BEREC members discussed their views on the main pillars of the Commission’s draft Recommendation:

  • BEREC agreed with the Commission that effective non-discrimination rules are essential for competition, ensuring a level playing field between incumbents and new entrants, and that achieving an “equivalence of inputs” is in principle the surest way to achieve this.  BEREC will seek confirmation in the final Recommendation that national regulatory authorities will assess the proportionality of different non-discrimination obligations, either an “equivalence of inputs” or an “equivalence of outputs”, when determining the most appropriate approach for their national market.
  • BEREC agreed with the Commission that wholesale pricing flexibility has an important role to play in supporting investment in next generation access, and shares the Commission’s desire to avoid any unanticipated consequences of linking the lifting of cost orientation obligations to the imposition of non-discrimination obligations.  BEREC and the Commission will therefore work closely to monitor the impact of the Recommendation going forward.
  • Further tests may be needed to prevent abusive pricing behaviour by dominant operators.  BEREC welcomes the Commission’s clarifications during recent discussions that the appropriate test will depend on the national regulatory authority’s regulatory objective and is without prejudice to the margin squeeze tests that they already use.
  • BEREC supports the Commission’s aim of achieving predictable and stable copper prices in line with the principle of cost orientation, which will help encourage efficient investment in next generation access and provide a competitive safeguard to third-party access seekers.  BEREC and the Commission agree that the approach used by national regulatory authorities should reflect, amongst other things, the network architecture being pursued, which in turn would generate prices that reflect the actual costs faced by operators in each market.

BEREC also adopted its response to the Commission’s questionnaire on a proposed revision to the Recommendation on relevant markets and an opinion on the Commission’s draft Recommendation on “Implementing Universal Services for a Digital Society”.

In response to BEREC’s publication, European Commissioner Neelie Kroes said: “I am very happy that BEREC … has given a positive opinion on our draft Recommendation on non-discrimination obligations and costing methodology for regulated wholesale network access.  BEREC fully supports our overarching objective to encourage high-speed internet investment across Europe and our strategic objective of ensuring predictable and stable access copper prices, effective non-discrimination obligations that sustain competition, and pricing flexibility for such services to meet demand. Predictable and consistent rules which contribute to a competitive EU single telecoms market are what market players and investors need for long-term planning.  We will take account of BEREC’s constructive opinion and work closely together to ensure that we deliver a pro-competitive, pro-investment regulatory environment.  I am confident that industry will respond positively and invest”.  For a link to BEREC’s press release, click here.  To read Neelie Kroes’ statement in full, click here.

European Patent Office publishes recommendations for improving patent system.

The EPO’s Economic and Scientific Advisory Board (ESAB) has issued a statement with recommendations for improving the patent system, based on the main findings of its 2012 activities.  Along with this statement, the ESAB has also published reports of three workshops it conducted in 2012, namely on patent quality, the role of fees, and patent thickets.

In these publications the Board highlights the importance of patent quality in boosting innovation.  It points out that improving patent quality will require action at both the pre-and post-grant stages of the patenting process.  In the pre-grant phase, specific measures are needed to address the speed and quality of patent examination.  At the post-grant stage, opposition or re-examination proceedings require improvement, together with the litigation system.  On this latter point, the establishment of Europe’s Unified Patent Court is expected to make a major contribution.

In its study on patent thickets the Board clearly states that it does not regard such  thickets as a root cause of problems in the patent system.  It concludes that measures to improve patent quality will help to reduce the complexity of the system and thus deal with patent thickets indirectly.  To read the EPO’s press release in full and for a link to the recommendations, click here.

Home Office announces creation of new “Cyber Crime Reduction Partnership” to tackle growing threat of organised and global cyber criminals.

In a speech at BCS, the Chartered Institute for IT, Security Minister James Brokenshire announced that the Home Office is bringing together police, industry experts and academics in the new Cyber Crime Reduction Partnership, jointly led by Mr Brokenshire and the Minister for Universities & Science David Willetts to ensure police and other law enforcement agencies can stay one step ahead of online criminals.

Mr Brokenshire said: “For too long the public’s perception of cyber crime has been a lone bedroom hacker stealing money from a bank account.  But the reality is that cyber criminals are organised and global, with a new breed of criminals selling ‘off-the-shelf’ software to aid gangs in exploiting the public.

“This government is committed to tackling this threat and we have already had great success.  But we want to go further and through the creation of the National Cyber Crime Unit within the NCA and innovations such as the new Cyber Crime Reduction Partnership, I am confident we can bring these criminals to justice”.

The Home Office says that law enforcement agencies have had a number of significant successes to date.  In its first year the Police Central e-Crime unit, part of the Cyber Security Strategy, prevented an estimated £538 million of harm being caused.

The Minister added: “It is important that members of the public or businesses report cyber crimes to Action Fraud, the UK’s national reporting centre.  Simple steps, such as setting strong passwords and using up-to-date virus software, can reduce the risk of becoming a victim”.  To read the Home Office press release in full, click here.

European Court of Human Rights rules that “Pirate Bay” co-founders’ criminal conviction for assisting copyright infringement on the internet was justified.

During 2005 and 2006 Fredrik Neij, a Swedish national, and Peter Sunde Kolmisoppi, a Finnish national, were both involved in the running of the website “The Pirate Bay” (TBP), one of the world’s largest file-sharing services on the internet.  The website allowed users to exchange digital content including music, films and computer games.  

In April 2009, the Stockholm District Court sentenced Mr Neij and Mr Sunde Kolmisoppi to one year’s imprisonment and held them, together with the other defendants, jointly liable for damages of approximately 3.3 million euros for committing crimes in violation of the Swedish Copyright Act.  Subsequently, several entertainment companies brought private claims within the proceedings.  In November 2010, the Court of Appeal reduced the defendants’ prison sentences, but increased the joint liability for damages to approximately five million euros.  Ultimately, the Supreme Court refused leave to appeal in February 2012.

Mr Neij and Mr Kolmisoppi applied to the European Court of Human Rights on 20 June 2012 alleging that they could not be held responsible for other people’s use of TPB, the initial purpose of which was merely to facilitate the exchange of data on the internet.  They argued that only those users who had exchanged illegal information on copyright-protected material had committed an offence. Therefore, relying on Article 10 of the European Convention on Human Rights, they complained that their conviction for complicity to commit crimes in breach of the Copyright Act had violated their right to freedom of expression.

The European Court of Human Rights unanimously declared the application inadmissible.  The court found that sharing, or allowing others to share, files on the internet (even copyright-protected material and even if for profit-making purposes) was covered by the right to “receive and impart information” under Article 10.  Thus, the applicants’ Article 10 rights were engaged and the conviction had interfered with such rights.  However, since the shared content was protected by the Swedish Copyright Act, the interference of the Swedish authorities had been prescribed by law.  Further, the court considered that the Swedish courts had rightly balanced the competing interests of the right of the applicants to receive and impart information and the necessity to protect copyright when convicting the applicants.  The Swedish courts had “a wide margin of appreciation to decide on such matters”, the court said, especially since the information at stake was not given the same level of protection as political expression and debate.  Accordingly, the Swedish court’s obligation to protect copyright under both the Copyright Act and the Convention had constituted a “weighty reason” for restricting the applicants’ freedom of expression.  Moreover, considering that Mr Neij and Mr Sunde Kolmisoppi had not removed the copyright-protected content from their website despite having been requested to do so, the prison sentence and award of damages was not disproportionate.  Therefore, the court rejected the application as “manifestly ill-founded”.  (Neij and Sunde Kolmisoppi v. Sweden (application no. 40397/12) (13 March 2013) – for a link to the decision in full, click here).

Data Protection

Article 29 Data Protection Working Party highlights data protection issues relating to development and use of apps. 

In a detailed Opinion, the Working Party notes that app developers may be unaware of data protection requirements, which could lead to them creating “significant risks to the private life and reputation of users of smart devices 

The Opinion notes that apps are able to collect large quantities data from a smart device (e.g. data stored on the device by the user and data from different sensors, including location) and process such data in order to provide new and innovative services to the end user. “However, these same data sources can be further processed, typically to provide a revenue stream, in a manner which may be unknown or unwanted by the end user”, the Opinion states.

The key data protection risks to end users are, the Opinion states, the lack of transparency and awareness of the types of processing an app may undertake combined with a lack of meaningful consent from end users before that processing takes place.  Poor security measures, an apparent trend towards data maximisation and the elasticity of purposes for which personal data are being collected further contribute to the data protection risks found within the current app environment.

A high risk to data protection also stems from the degree of fragmentation between the many players in the app development landscape, the Opinion says.  They include app developers, app owners, app stores, operating system and device manufacturers and other third parties that may be involved in the collection and processing of personal data from smart devices, such as analytics and advertising providers. 

The Opinion reminds the relevant parties that EU legislation on data protection applies to any app targeted to app users within the EU, regardless of the location of the app developer or app store.  The document also clarifies the legal framework applicable to:

  • the processing of personal data in the development, distribution and usage of apps on smart devices with a focus on the consent requirement;
  • the principles of purpose limitation and data minimisation;
  • the need to take adequate security measures;
  • the obligation to correctly inform end users;
  • end users’ rights;
  • reasonable retention periods; and
  • fair processing of data collected from and about children. 

For a link to the Opinion, click here.

Broadcasting

Ofcom consults on spectrum pricing for terrestrial digital broadcasting.

The consultation sets out revised policy proposals on the introduction of charges for radio spectrum used by terrestrial broadcast multiplex operators.

Ofcom says that, in principle, it believes that all users of spectrum should pay an appropriate charge for access to what is “a scarce resource”.  The use of spectrum for terrestrial broadcasting is one of the few remaining areas where such charges have not yet been applied, the regulator says.  Ofcom says that it first announced potential charges for spectrum in June 2007, when it said that the right time to introduce such charges would be from the end of 2014.

The consultation restates the principles underlying the application of spectrum charges; considers the basis on which those charges should be applied to spectrum used for broadcasting; and discusses how an appropriate level of fees might be calculated.

Ofcom says that, “At the very least, we believe fees should cover the costs we incur in the regulatory management of the spectrum”.  It considers that it will typically achieve the optimal use of spectrum by setting charges at a level that “reflects the opportunity cost of spectrum”.  The practice of setting charges that reflect opportunity cost is referred to as “Administered Incentive Pricing” (AIP).

Ofcom explains that the principle behind AIP is that the use of spectrum for any particular purpose imposes an opportunity cost on society.  This cost is the value of the alternative uses of that spectrum that are denied access as a result.  If users pay a charge that reflects opportunity cost, they have an incentive to use the spectrum they hold in the most efficient way or vacate it for a more valuable use.

The first stage in calculating an appropriate level for AIP is, according to Ofcom, to determine current and alternative uses for the particular spectrum.  If there is excess demand for the spectrum, then AIP is applicable.  The next stage is to calculate the relevant opportunity cost.  If there is no excess demand for the spectrum, then AIP is not applicable.  However, AIP is only one tool and in some cases it will be appropriate to use other tools to achieve the overall aim of optimal use.

Ofcom proposes to proceed with the introduction of charges for spectrum used for national DTT broadcasting from the end of 2014.  It believes that it is appropriate, in principle, to set charges at AIP levels.  However, Ofcom is proposing at this stage only to introduce charges to cover the costs it incurs in the regulatory management of the spectrum used for national DTT.  It will introduce charges at AIP levels at a later date, once it has materially progressed its proposals for future use of the UHF spectrum.  The regulator expects to introduce AIP by around 2020.

Ofcom says that it believes that its proposals to delay the introduction of AIP for national DTT broadcasting “remove considerable uncertainty for broadcasters in the short term”.  However, in the longer term it does expect to introduce AIP-based charges and it recognises that uncertainty about the eventual level of charges remains.  To minimise that uncertainty, Ofcom says that it has already considered both the possible level of AIP-based charges and the manner in which they might be introduced.  

In a scenario in which the 700 MHz band has been harmonised for mobile use after 2018 and the DTT multiplexes are operating in the remaining DTT UHF spectrum, including the 600 MHz band, the indicative AIP on national DTT broadcasters thereafter would be around £10 million per multiplex per annum (at 2020 prices).

If harmonisation of the 700 MHz band occurs and the DTT multiplexes continue to operate in the 700 MHz band, AIP would be of the order of £40 million per multiplex per annum.  Ofcom says that it would expect to introduce AIP gradually over a period of 5 years to avoid imposing a sudden additional cost on national DTT broadcasters.  For a link to the consultation documentation, click here.

Ofcom prepares for second phase of local TV licensing.

Ofcom is inviting expressions of interest to offer local TV services in 30 new locations across the UK, ahead of a second phase of licensing.

Earlier this month, Ofcom announced that it had awarded 19 licences in the first phase.  This follows duties given to Ofcom by Parliament to license local TV.  It is hoped that some channels in the first phase may be on air before the end of 2013.

Local TV channels will broadcast via a specific “multiplex”, which has a discrete amount of spectrum reserved for local TV broadcasting on digital terrestrial TV (DTT).

The multiplex operator Comux, responsible for building and maintaining the technical infrastructure required to broadcast the local TV channels, has proposed 28 new locations where coverage is technically possible.  Ofcom is seeking expressions of interest from potential applicants in these 28 new locations, as well as for Swansea and Plymouth, which were advertised in the first round but received no applications.

The closing date for expressions of interest is 24 April 2013.  Ofcom will consider all responses and publish further details on any future licensing round later this year.  It is possible that there may be channels in phase two locations on air by the end of 2014.  For further details, click here.

High Court refuses to prefer common law conspiracy to defraud charge against unlicensed streamer of Premier League matches.

Marc Dady, personally and in conjunction with his companies Live Sport Network Ltd and M Dady Ltd, ran a website, www.free-football.tv, which for a £10 fee facilitated the illegal downloading of Sky’s Premier League football matches by his subscribers.  The matches in question were being “streamed” or illegally re-broadcast over the internet from abroad.  Mr Dady’s website had not been licensed to broadcast, stream or otherwise make available audiovisual footage of matches, the copyright of which was owned by the Football Association Premier League, nor had Mr Dady been authorised by any of FAPL’s licensees to do so.

Mr Dady was charged with an offence of conspiracy to defraud. Judge Armstrong at Teesside Crown Court dismissed the charge.  The Crown then applied to the High Court to prefer a voluntary Bill of Indictment repeating the same charge.  The Crown maintained that Mr Dady could have been charged with conspiracy to commit offences under s 297 of the Copyright, Designs and Patents Act 1988 (dishonestly receiving a broadcast programme with intent to avoid payment).  However, given the scale of Mr Dady’s offending and the fact that the offence under s 297 was summary only, the Crown considered that s 297 “simply did not do the job”. 

Mr Justice Coulson said that the court’s task on such an application was to consider whether there was a relevant statutory offence and, if so, how and why the Crown chose not to prefer conspiracy charges by reference to that offence, and whether it was proper in all the circumstances to allow the common law allegation of conspiracy to defraud to be maintained.  In the judge’s view, s 297 caught the criminal conduct alleged against Mr Dady.  He was providing his subscribers, for a fee, with a means to get round the encryption, which for present purposes, the judge was prepared to accept amounted to a conspiracy to breach s 297. 

The Criminal Law Act 1977 imposed restrictions on the institution of proceedings for conspiracy to commit statutory offences.  Any conspiracy proceedings would have had to have been started within six months of the offence, and the permission of the DPP would have been required.  In the judge’s view, it would be wrong to allow the Crown to ignore these safeguards, and to charge what would otherwise be a precise statutory offence under the wide common law offence of conspiracy to defraud.  To allow the Crown to prefer the voluntary Bill would be contrary to Lord Bingham’s guidance in R v Rimmington [2005] UKHL 63, because it would deprive the defendant of the protection of being charged with an offence which was summary only.  Moreover the court was required to treat the Crown Court ruling with the greatest respect.  Exceptional circumstances were required to reverse its effect and good reasons were required to permit a common law conspiracy charge to be maintained in the absence of a charge of conspiracy under s 297.  In Coulson J’s view neither was present here.  (R v Marc Dady [2013] EWHC 475 (QB) (8 March 2013) – to read the judgment in full, click here).

Publishing

It was announced this morning that a deal has been agreed on a press regulator, following ‘eleventh hour’ talks overnight.  A charter is to be published this morning and to be put to MPS this afternoon, with an amendment to the Enterprise and Regulatory Bill providing statutory underpinning:

 “Royal Charters

Royal Charters: requirements for Parliamentary approval

Where a body is established by Royal Charter after 1 March 2013 with functions relating to the carrying on of an industry, no recommendation may be made to Her Majesty in Council to amend the body’s Charter or dissolve the body unless any requirements included in the Charter on the date it is granted for Parliament to approve the amendment or dissolution have been met.”

 To read the Bill in full, click here

Sport

European Parliament passes Resolution calling for common penalties across the EU for match-fixing.

Those involved in fighting against match-fixing, including sports organisations, police, judicial authorities and gambling operators, should better coordinate their efforts by exchanging information and sharing their most successful tools against corruption in sports, says the non-binding Resolution.  Member States should also set up national bodies to improve coordination and information exchange.

Circulating the names of people involved in corruption cases would help to prevent them simply shifting their illegal business to another EU country, MEPs suggest.

To enforce EU law in this field, Member States should also set up joint investigation units to take out illegal and anonymous betting websites across the EU.

The Resolution also urges the European Commission to identify third countries, especially those hosting “Asian betting havens”, with a view to stepping up collaboration to combat organised crime linked to illegal betting and match-fixing.

Parliament also proposes a code of conduct for all players, referees and technical staff, measures to protect minors and national education programmes.  These proposals should be added to a Commission Recommendation on how to prevent and combat match-fixing set to be adopted next year, MEPs say.  To read Parliament’s press release in full, click here.

Gambling & Betting

Remote Gambling Association complains to European Commission about Greek Government’s plans to extend state-controlled gaming organisation OPAP’s offline monopoly to online gambling products.

The complaint focuses on the extension of OPAP’s offline monopoly to online products, including sports betting and other gambling products such as casino and poker.  The main arguments are that the Greek Gambling Act allows for the licensing of online gambling operators but the Ministerial Decisions and administrative measures undertaken prevent any operator other than OPAP from being granted a full licence.  In effect, the RGA says, the Government has granted an exclusive right to OPAP, which infringes Article 56 of the Treaty on the Functioning of the European Union (TFEU).

The complaint criticises the failure of the Greek state to fully implement the Gambling Law of 2011, which provides for the regulation of the Greek online betting and gambling market.  This failure means that operators who currently have licences in other EU Member States will not be able to apply for licences in Greece until 2020 at the earliest.

The RGA previously complained to the Commission about the internet and payment blocking mechanisms that were set up to protect the OPAP monopoly.  The RGA said that such mechanisms disproportionately restricted the freedom to provide services, the free movement of capital and payments, and the fundamental freedoms to conduct a business, provide and receive information and of respect for privacy, in violation of EU law.

Clive Hawkswood, CEO of the RGA said: “Again and again the Greek Government has failed to comply with basic EU law.  As recently as Friday 1 March, they made significant revisions to the draft Law and yet these have not even been notified to the European Commission.  We have written to the Commission asking them to intervene and get this latest draft notified to them in accordance with the provisions of Directive 98/34/EC.  Until the Hellenic Republic complies fully with EU law, the Greek people will not get the benefits of a regulated and competitive market; the Government will miss out on long term revenues; and legitimate online gambling operators will be excluded from the market.

Members of the RGA expect all operators to be offered a level playing field across Europe.  No one could suggest that is unreasonable.  In Greece we have OPAP’s monopoly being protected and extended for a short term gain when in the long run the Greek people will benefit from additional choice and better value if the remote gambling market is opened up”.  To read the RGA’s press release in full, click here.

Advertising

Committee of Advertising Practice (CAP) publishes Help Note on advertising on Video On Demand services.

CAP says that, although bearing some similarities to broadcast TV advertising, advertising on Video on Demand (VOD) services is non-broadcast, in the same way as other internet ads and website content, and is therefore covered by the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code).  Advertisers using VOD services should ensure that their ads comply with the relevant sections of the CAP Code and Appendix 2, which applies specifically to VOD advertising.  The Appendix contains rules that apply to regulated on-demand services and reflect the legal requirements in the Communications Act 2003 (as amended) with which media service providers must comply.

CAP has produced a Help Note about Advertising in video-on-demand services which contains further information and guidance on VOD advertising.

Similarly, advertisers can sometimes be unclear as to whether advertising on online music streaming services is broadcast, like radio advertising, or non-broadcast and therefore subject to the CAP Code.  As the ad is served only at the request of the user when they access content online, the ad is considered non-broadcast and therefore falls within the remit of the CAP Code.

European Commission announces plans to strengthen enforcement against unfair commercial practices.

The European Commission has outlined a series of actions to tackle aggressive commercial practices across the EU, such as fake “free” offers, “bait and switch” advertising for products which cannot be supplied, and exhortation of children.  Five years after it entered into force, the Commission has reviewed the application of the Unfair Commercial Practices Directive (2005/29/EC) and announced plans to step up enforcement of the rules to increase citizens’ trust when shopping in Europe’s internal market.

The initiative is part of the Commission’s action to boost consumer confidence under the European Consumer Agenda.  The Commission says that by shopping online across EU borders, consumers can benefit from up to 16 times more products from which to choose, but 60% of consumers are still not taking advantage of this.  As a result, consumers do not fully benefit from the variety of choice and lower prices available in the Single Market.  Improving consumer confidence by better enforcing the rules can provide a major boost to economic growth in Europe.  Indeed, surveys show that more consumers are now interested in making cross-border purchases and are willing to spend more money cross-border than in 2006 when the EU rules had not yet come into force.

The Commission says that, thanks to the Unfair Commercial Practices Directive, national consumer protection watchdogs have been able to curb a broad range of unfair business practices, such as providing untruthful information to consumers or using aggressive techniques to influence their choices.  By replacing 27 national regimes with one set of rules, the Directive has simplified rules on unfair commercial practices, making it easier for consumers to know what their rights are no matter where in the EU they are shopping.  However, both consumers and traders are still faced with uncertainty in knowing how the rules will be enforced by the different national enforcement bodies.

The Commission says that it will therefore seek to play a more prominent role in reinforcing cooperation between national enforcement bodies by:

  • strengthening the efficiency of the European consumer protection network and further promoting coordinated enforcement actions;
  • assisting Member States in effectively applying the Directive with guidance and sharing best practices;
  • developing enforcement indicators to detect shortcomings and failures that require further investigative and/or corrective action; and
  • establishing regular thematic workshops between national enforcers and organising training for enforcers and the judiciary.

To read the Commission’s press release in full, click here.

ASA clears online clothing retailer Asos.com’s killer” internet video of irresponsible advertising despite appearing on non-age-gated YouTube.

The video showed the character “Asossin” pulling down large Christmas decorations, which crushed a man.  He was also shown pushing a radio into a bath in which a man was sitting as well as shutting a woman in a chest freezer.  On-screen text stated “HAVE A KILLER CHRISTMAS”.  The video appeared on YouTube and the Entertainmentwise website.

Complainants challenged whether the ad was irresponsible, in particular because it could be seen by children who might emulate the scenes shown.

Asos said the campaign was designed specifically to target their core menswear demographic.  It said that the ad was clearly tongue-in-cheek with Asossin eliminating Christmas clichés in obvious juxtaposition to the glitz and glamour of Christmas, so others could go on enjoying the party.  Asos believed the implied references to homicide were not offensive.  The ad was shown only in digital spaces to ensure it was targeted at the audience of males in their twenties.  Asos said it was not age-gated on YouTube because that was considered unnecessary due to the way it was targeted and because no killing or death was shown. 

YouTube said it had received a few “flags” reporting the video but after review considered that it did not violate its community guidelines.  Entertainmentwise said the word “killer” would be interpreted as slang for “great” and that the word was used literally in the ad for comic effect.  

While it considered the video was not suitable for younger children due to the risk of emulation, the ASA noted that the ad, which did not show death or any explicit violence, was targeted at an audience of males in their twenties.  The ASA also noted that Entertainmentwise was a gossip website, which was unlikely to appeal to young children, and that the complainants had not reported seeing the ad with material that was targeted at children on YouTube. The ASA considered that the targeting used would not entirely prevent those younger than the intended audience from seeing the ad, but its placement meant it was unlikely to be viewed by young children.  

Additionally, it felt that if older children, such as those interested in celebrity gossip, saw the ad, they would be likely to understand that it was tongue-in-cheek and that the actions shown should not be emulated.  Accordingly, the ASA concluded that the ad did not breach CAP Code rule 1.3 (Responsible advertising).  To read ASA Adjudication on Asos.com Ltd (13 March 2013) in full, click here.

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