HomeInsightsNeed to Know – 2013.05.07

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General

Intellectual Property Office publishes note on how Enterprise and Regulatory Reform Act 2013 will affect photographers.

Technology

Government consults on plans to boost roll-out of mobile broadband.

PhonepayPlus makes changes to prior permission regime for subscription services.

Government publishes guidance on submitting evidence to consultation on cyber-security strategy.

Ofcom announces plans for pilot of innovative “white space” technology in the UK and invites industry to take part.

Ofcom consults on proposal to make limitation order in connection with award of 600 MHz spectrum band.

Publishing

Government says Defamation Act 2013 will bring libel laws into the 21st century.

Newspaper Society writes to Secretary of State for Culture, Media and Sport about local newspapers’ concerns over Government’s proposed Royal Charter.

Industry Royal Charter for independent self regulation of press formally submitted to Privy Council.

World’s press backs UK media industry’s self-regulatory proposal.

Chartered Institute of Journalists writes to Privy Council expressing concern that proposed Royal Charter underpinning press regulation may impinge on its own Charter.

Film & TV

European Commission consults on new film support rules.

Gambling & Betting

Culture, Media and Sport Select Committee publishes pre-legislative scrutiny of draft Gambling (Licensing and Advertising) Bill.

Advertising

Advertising Standards Authority publishes Annual Report putting spotlight on “big five” misleading advertising priorities.

ASA finds Curry’s “cashback” tablet ad misleading for failing to make clear total extent of financial commitment needed to redeem offer.

General

Intellectual Property Office publishes note on how Enterprise and Regulatory Reform Act 2013 will affect photographers.

Following concerns raised by photographers over the new “orphan works” provisions in the Enterprise and Regulatory Reform Act 2013, the IPO has published a “myth and fact” information document. 

The IPO notes that there have been several reports and commentaries in the media incorrectly claiming that new orphan works provisions in the Act will remove the automatic right to copyright for owners of photos posted online.  This is clearly incorrect and, in fact, the powers will not remove copyright for photographs or any other works subject to copyright.  Further, they will not allow anyone to use a copyright work without permission or free of charge. 

In addition, a licence will be needed to use a work as an “orphan”.  This will require an applicant to undertake a diligent search for the copyright holder, which the Government appointed independent authorising body will have to verify, and then pay a fair price for the licence. 

The IPO notes that the Act in fact contains a number of protections for photographers and other creators.  In addition, the detailed rules are being developed with representatives of the photography sectors and other stakeholders.  There will also be a public consultation.  In any event, although the Act is now law it will only have an impact once rules for orphan works and extended collective licensing schemes have been developed, fully consulted on and approved by Parliament, which will not happen before 2014.  For a link to the IPO document, click here.

Technology

Government consults on plans to boost roll-out of mobile broadband.

The Government notes that demand for mobile broadband, including 4G, among consumers and business is high and growing.  It is estimated that the demand for mobile capacity will increase 80 fold by 2030, but regulations are holding up the roll-out of services in many parts of the country.

The Government says that its proposed changes will speed up the regulatory process for mobile broadband infrastructure, while maintaining environmental safeguards that are already in place for protected areas.  The plans ensure that the use and sharing of existing infrastructure is maximised and that installing new masts is avoided wherever possible.

The Government says that the key proposals will:

  • clarify existing permitted development rights to remove ambiguity;
  • ensure that the appropriate safeguards remain firmly in place for protected areas;
  • amend the rules on masts on buildings to enable mobile operators to install antenna further back from the edge of a building thus improving the visual appearance from the ground;
  • make it easier to allow the wall mounting of antenna, maximising the use of existing buildings/structures and minimising the number of new ground-based masts;
  • facilitate the use of small wall-mounted “microcell” antenna, which offer a fast way to add network capacity with minimal visual impact; and
  • encourage the sharing of masts, to avoid the need for every network operator to erect their own mast.

More than £1 billion of public money is being invested, including £150 million specifically in mobile, to transform broadband.  The Government says that speeds will be “dramatically higher and superfast fixed and mobile broadband will be widespread”.  This will reinforce the UK’s position as a leading digital economy and will be a major driver of local jobs and national growth. 

The consultation is open until 14 June 2013.  To read the Government’s press release in full and for details on how to respond to the consultation, click here.

PhonepayPlus makes changes to prior permission regime for subscription services.

PhonepayPlus is removing the exemption from the requirement that providers of subscription services costing over £4.50 in a seven-day period and who utilise the Payforit mechanic must seek prior permission to operate.  Therefore, Level 2 providers who operate subscription services costing over £4.50 in a seven-day period, and who use Payforit to confirm consumer consent to purchase, must now seek prior permission to operate with immediate effect.  Applications in respect of such services that are currently in operation must be made by relevant Level 1 providers (otherwise known as Accredited Payment Intermediaries) on behalf of relevant Level 2 providers for each such service by Thursday, 13 June 2013.  For all new services, applications must be made by the relevant Level 1 providers and permission must be granted prior to the operation of the services with immediate effect.

The changes have come about as a result of PhonepayPlus being approached by the four UK Mobile Network Operators informing the regulator of concerns relating to the transparency of key terms and conditions associated with subscription services using Payforit, in particular competition services.  These concerns were distinct from the presentation of key information prior to consent to purchase, which Payforit ensures.  PhonepayPlus summarised the concerns raised as follows:

  • misleading marketing prior to the Payforit mechanic being engaged.  Even though Payforit provides key information about price and the fact the service is a subscription, the consumer has been misled to believe that what is on offer is of greater value than is actually the case, and therefore the price is worth paying;
  • the increase over the last year in subscription services using the Payforit mechanic which also use web-based affiliate marketing.  PhonepayPlus is currently consulting on Guidance around Digital Marketing which can be caused by rogue affiliate marketing; and
  • the increase over the last six months in the number of subscription services using Payforit which charge over £4.50 per week, and in some cases up to £10 every three days.  This clearly increases the financial detriment to consumers who are misled, despite the use of Payforit to display pricing and other key information. 

To read PhonepayPlus’ compliance update notice in full and for details on how to apply for prior permission, click here.

Government publishes guidance on submitting evidence to consultation on cyber-security strategy.

The Government published its cyber security strategy in November 2011.  This set out its intentions to encourage industry-led standards and guidance for organisations to manage the risk to their information, and to encourage companies that are good at managing information risk to make this a selling point for their business.  

In March 2013 the Government published a consultation on “Cyber Security Organisational Standards”.  Organisations were invited to provide expression of interest to submit evidence in support of their preferred standard by 8 April 2013.  The Government has now published a guidance document and a response form to help organisations and groups prepare their evidence for submitting.  The final date for submitting evidence is 14 October 2013.

The Government says that the call for evidence, and its subsequent selection of a preferred standard, will help businesses identify what good cyber risk management looks like and select which organisational standards to invest in.  For links to the relevant consultation documentation and guidance, click here.

Ofcom announces plans for pilot of innovative “white space” technology in the UK and invites industry to take part.

The technology uses gaps in radio spectrum, i.e. “white spaces”, which exist in between frequency bands.  In this instance, these bands have been reserved for digital terrestrial TV broadcasting and wireless microphones.

Ofcom says that use of these white spaces will allow devices to transmit and receive wireless signals for applications such as broadband access for rural communities, Wi-Fi-like services or new “machine-to-machine” networks.

Ofcom is inviting industry to take part in the pilot, which is intended to take place in the autumn.  The locations for the trial will be chosen once trial participants have been identified.

Following a successful completion of the pilot, Ofcom anticipates that the technology could be fully rolled out during 2014, enabling the use of white space devices across the country.

Ofcom says that white space technology will be one way of meeting the growing demand for data in the UK.  Ofcom is separately planning to free up more spectrum in the future for the next generation of high-speed data services, already dubbed “5G”.  This follows the successful completion of the 4G mobile spectrum auction in February.

The pilot will test the inter-operation of white spaces devices, white space databases and the processes to mitigate against causing any undue interference to current spectrum users.  Compared with other forms of wireless technologies, such as regular Bluetooth and Wi-Fi, the radio waves used by white space devices will be able to travel longer distances and more easily through walls.  This is because they would use the lower frequencies that have traditionally been reserved for TV.

Under Ofcom’s plans, a TV white space device will not be able to start transmitting until it gets clearance from a database qualified by Ofcom and listed on a dedicated Ofcom website.  This database will provide updated information on where the TV white spaces are and the power level that devices would need to be restricted to if they wanted to use them.  Ofcom says that this will help ensure that there is no undue interference with the existing spectrum users.  To read Ofcom’s press release in full, click here.

Ofcom consults on proposal to make limitation order in connection with award of 600 MHz spectrum band.

In February 2013 Ofcom published its consultation, “Award of the 600 MHz spectrum band including request to stakeholders to notify intention to apply”, setting out proposals for awarding the 600 MHz spectrum band.  In particular, Ofcom proposed awarding a single licence for the purposes of establishing Digital Terrestrial Television (DTT) multiplexes in the 600 MHz band and invited stakeholders to submit a Notice of Intention to Apply if they were interested in holding such a licence.

Ofcom says that it received one completed Notice of Intention to Apply.  It is currently in the process of considering the consultation responses received and will decide whether to proceed with awarding the spectrum as proposed, and if so on what terms, in light of those responses.

If Ofcom decides to proceed with the award of the spectrum it says that it will award a wireless telegraphy licence for equipment operating within the 600 MHz band (550-606 MHz, but excluding Channel 36, i.e. the frequencies between 590 and 598 MHz).  As Ofcom has received only one Notice, the process and rules for the award of the licence would be in accordance with the Wireless Telegraphy (Licensing Procedures) Regulations 2010.

Ofcom considers that it would be appropriate to limit the number of licences to be awarded in order to secure the efficient use of the electro-magnetic spectrum and the efficient use, in particular, of this band.  Accordingly, under s 29 of the Wireless Telegraphy Act 2006, Ofcom would need to make an order, limiting the number of licences granted for the use of this spectrum.  As set out in the consultation, should Ofcom decide to proceed with awarding the spectrum, there will only be a relatively short period of time in which the licensee will be able to utilise the spectrum.  Therefore, if a decision is taken to award the spectrum, it is important that Ofcom is able to grant a licence as quickly as possible.  It is for this reason that it is now consulting on a draft Wireless Telegraphy (Limitation of Number of Licences) Order 2013, which it would propose to make should it decide to proceed with the award of the 600 MHz band.  For a link to the consultation documentation, click here.

Publishing

Government says Defamation Act 2013 will bring libel laws into the 21st century.

As reported last week, the Defamation Act 2013 has gained royal assent.  The Government has published a press release saying that the new Act will “overhaul the libel laws in England and Wales and bring them into the 21st century, creating a more balanced and fair law”.

Justice Minister, Lord McNally, said: “This Act represents the end of a long and hard fought battle to reform the libel laws in England and Wales.  Throughout the process all parties have listened and worked together to produce legislation that delivers the reforms required in the 21st century.  Everyone involved can be rightly proud of this Act and the protections and freedoms it offers”.

The Defamation Act will be brought into force later in the year.  According to the Government, it offers “clearer, better protection for individuals, members of the press, scientists and academics who wish to publish information and views without the threat of libel action.  It also gives legal recourse and protection to those who are genuinely defamed”.

The measures include:

  • protection for scientists and academics publishing in peer reviewed journals;
  • protection for those who are publishing material which they reasonably believe is in the public interest;
  • a requirement for companies and individuals to show serious harm to establish a claim;
  • a single publication rule to prevent repeated claims against a person about the same material;
  • a tighter test before claims involving those with little connection to England and Wales can be brought before the courts, addressing libel tourism; and
  • a new process enabling website operators to help people complaining about online statements to resolve the matter directly with the party responsible for posting the material.

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

Newspaper Society writes to Secretary of State for Culture, Media and Sport about local newspapers’ concerns over Government’s proposed Royal Charter.

The letter, dated 29 April 2013, states that the Government’s proposals for press regulation by Royal Charter, which have been rejected by most of the national newspapers, “ha[ve] not been discussed with regional and local newspapers”.  Further, they do not honour Leveson’s recommendation that no additional burdens be placed on regional and local newspapers.  “The Charter punishes regional and local newspapers for crimes and activities for which they have been found innocent and asks them to be part of an expensive, burdensome regulatory structure either as part of the whole industry or on their own”, the letter states.

The letter notes that the Deputy Prime Minister previously suggested that the regional and local newspaper industry would have the flexibility to set up its own Regulator, which will meet its concerns.  However, the Newspaper Society says, there is nothing in the Government’s proposed Royal Charter which suggests that a regulator for the regional press will be able to act in such a way.  “It will have to meet the same rigid, near-permanent Charter and Recognition Criteria which will apply to all other newspapers and magazines particularly in respect of the compulsory arbitration scheme, for example”, the letter states.

The letter informs the Secretary of State that the regional and local newspaper and magazine industry was fully involved in devising the draft Industry Royal Charter proposal, which was published last week, and is “in full support of it”.

The letter goes on to call for a meeting with the Secretary of State before the Government’s Royal Charter proposal is placed before the Privy Council.  The Newspaper Society believes that Britain’s 1,100 newspapers “deserve a fair hearing before matters reach the Privy Council

The letter concludes: “Regional and local newspapers are custodians of freedom of speech and the freedom to publish in this country.  Their views and concerns come from a historic perspective about relationships between the Monarchy, Parliamentary and Local democracy, the community and the citizen.  It is vital that that perspective is understood.  The Monarch’s prerogative powers should not be used to impose a regulatory regime on regional and local newspapers without consultation and a genuine attempt to proceed by consent”.  To read the letter in full, click here.

Industry Royal Charter for independent self regulation of press formally submitted to Privy Council.

Whilst the Government’s proposed Royal Charter on press regulation has not yet been submitted to the Privy Council (see item above), the Newspaper Society has reported that the newspaper and magazine industry’s proposed Royal Charter has been formally submitted to the Privy Council Office.

The document submitted by the four newspaper and magazine trade associations (the Newspaper Society representing regional and local newspapers, the Newspaper Publishers Association representing national newspapers, the Professional Publishers Association representing magazines and the Scottish Newspaper Society), was published by the industry on 25 April 2013.  Since then there has been one small amendment to include in the recognition criteria the provision by the new independent regulator of a whistle-blowers’ hotline.

The Newspaper Society says that the press’s proposed Royal Charter has been backed by a number of senior MPs and Peers, and has the support of the overwhelming majority of the country’s national, regional and local newspapers and magazines.  According to a recent opinion poll carried out by the polling company Survation, the industry proposal also has the clear backing of the public.

It is understood that the next meeting of the Privy Council is due to take place on 15 May 2013.  To read the Newspaper Society’s press release in full, click here.  For more information on the recent opinion poll, click here.

World’s press backs UK media industry’s self-regulatory proposal.

The World Association of Newspapers and News Publishers (WAN-IFRA), and the World Editors Forum, say that they “stand firmly behind the joint initiative of the United Kingdom’s newspaper and magazine industry to safeguard press freedom”.

WAN-IFRA backs the industry-proposed Royal Charter for independent self-regulation of the press that has now been formally submitted to the Privy Council Office as it “seeks to distance politicians from the regulation process, countering the proposed statutory underpinning of the press that lies at the heart of the Government’s Royal Charter”.

WAN-IFRA said: “The Leveson inquiry asked many important questions of the British press, to which the industry, not the Government, was always best-placed to answer.  The industry has proposed a sound response to attempts to implement regulation, which would threaten the independence of the British press, and send shockwaves around the world regarding the UK’s commitment to safeguarding press freedom”.

WAN-IFRA, a global organisation for the world’s newspapers and news publishers, represents 18,000 newspapers, 15,000 online sites and more than 3,000 companies in 120 countries.  Along with press freedom organisations and human rights groups worldwide, WAN-IFRA says that it “rejects statutory underpinning for press regulation and has persistently warned of the implications of such proposals for press freedom globallyFurther, the organisation says, “300 years of democratic tradition and press independence in the United Kingdom are at stake, while oppressive regimes around the world would undoubtedly seize on such a precedent to justify their use of statutory regulation to silence critical voices in the press.  Such legislation would also be a major setback for those countries making tentative but steady progress towards press freedom, and who are influenced by the United Kingdom’s democratic model”.  To read WAN-IFRA’s press release in full, click here.

Chartered Institute of Journalists writes to Privy Council expressing concern that proposed Royal Charter underpinning press regulation may impinge on its own Charter.

The Institute’s Charter was granted by Queen Victoria in 1890, six years after the organisation was founded (as the National Association of Journalists).

Among the Institute’s aims and objectives set out in the Charter are:

  • The ascertainment of the law and practice relating to all things connected with the journalistic profession and the exercise of supervision over its members when engaged in professional duties”; and
  • Watching any legislation affecting the discharge by journalists of their professional duties and endeavouring to obtain amendments of the law affecting journalists, their duties or interests”.

The Institute’s president, Charlie Harris said: “We have legal advice that the charter sent by Parliament to the Privy Council for royal assent could have implications for our own charter and that we have a right to be consulted before any new charter that overlaps with ours is laid before Her Majesty for approval.  Our general secretary Dominic Cooper has written to the Privy Council pointing out the possible conflict and saying that we would like to discuss the implications”.

The Institute says that it is “totally opposed to any state involvement in the enforcement of professional ethics and has warned that however “light touch” the current proposals may be, they set a dangerous precedent, opening the way for a future government to impose much tougher restrictions which would endanger the free press and democracy”.

The Institute also says that the alleged malpractices which led to the Leveson Inquiry and the arrest of dozens of journalists are criminal offences, not ethical misdemeanours, and that the problem is not a failure of the editorial regulatory system but the failure of the police to enforce the law.  To read the Institute’s press release in full, click here.

Film & TV

European Commission consults on new film support rules.

The European Commission has launched the third and final public consultation in its review of the state aid criteria it uses to assess Member States’ support schemes for films and other audiovisual works.  The criteria are set out in a draft Communication, on which the Commission is inviting comments.  The final Communication is due to be adopted by the Commission in July 2013.

The revised draft Communication reflects the contributions received on the original draft published by the Commission on 14 March 2012. The draft rules extend the scope of activities covered by the Communication to include all phases of an audiovisual work from concept to delivery to audiences.  The existing rules (adopted in 2001) only apply to production support.

The Commission proposes to continue allowing Member States to impose territorial spending obligations up to 80% of the overall production budget.  However, restrictions on the origin of goods and services, which are incompatible with the basic principles of the EU Single Market, would be clearly prohibited.  Compared to the previous rules adopted in 2001, the new draft ensures proportionality of territorial obligations in respect of the aid granted and takes into account the specific characteristics of tax incentives.

Commissioner Joaquín Almunia commented: “Today’s revised draft rules aim to set the scene for a successful European audiovisual sector which can deliver the films European audiences enjoy.  Their objective is to encourage creation and cultural diversity in all parts of the EU and to foster a genuinely European cinema, where cross-border productions can be set up easily.  This new draft also attempts to reconcile the different points of view expressed by Member States about what rules are needed at EU level”.

Comments should be sent by 28 May 2013.  To read the Commission’s press release in full and for a link to the revised draft Communication and details on how to comment on it, click here.

Gambling & Betting

Culture, Media and Sport Select Committee publishes pre-legislative scrutiny of draft Gambling (Licensing and Advertising) Bill.

Around 80% of remote (i.e. online) gambling in the UK is conducted with operators that are not licensed in the UK.  In December 2012 the Government published a short draft Gambling (Licensing and Advertising) Bill to require overseas gambling operators to obtain a Gambling Commission licence in order to provide services or advertise to British-based consumers.  The Culture, Media and Sport Select Committee has now scrutinised that Bill.

The Committee noted that the overseas-based remote gambling operators generally opposed the Bill on the grounds that it was unnecessary for consumer protection, might drive consumers to cheaper unlicensed operators and was principally intended to bring overseas operators within the UK’s tax regime.  Much of the UK-based gambling industry, sports bodies (concerned about match-fixing) and organisations working to combat problem gambling, supported the principle of the Bill.  Almost all those who gave oral or written evidence to the Committee raised the issue that the enforcement regime would have to be rigorous in order to provide any of the benefits to consumers that the Government intended should be derived from the legislation.

The Committee says that it supports the principle that gambling should be regulated on a “point of consumption” basis, i.e. where the consumer is.  As for concerns raised about taxation of the online industry, the Committee noted that, according to the Government, the ability to bring all operators serving UK consumers within the tax net was a consequence, but not the prime motivation, of the draft legislation.  The Committee noted in this regard that, in setting a tax rate for remote gambling, the Treasury should bear in mind that too high a rate would be liable to drive customers and companies into the unregulated, black market.

The Government and the Gambling Commission assured the Committee that the Commission had at its disposal all the tools it needed for effective enforcement and that the extra income expected from the extension of the licensing regime would produce sufficient funds to pay for the extra work of enforcing that regime, without the need to raise licence fees.  The Committee says that it intends to monitor these areas.

The Committee has recommended a change to clause 1 of the Bill to make it clearer that the operators affected are those providing remote gambling services to customers in Great Britain.  It also suggested that the Government amend the Bill to address the anomaly that it is illegal for casinos to provide online gambling on their premises.  To read the Committee’s report in full, click here.

Advertising

Advertising Standards Authority publishes Annual Report putting spotlight on “big five” misleading advertising priorities.

The ASA says that, last year, 70% of its cases were about misleading advertising.  The Annual Report describes the “big five” misleading advertising priorities as: i) free trials; ii) pricing; iii) daily deals; iv) testimonials; and v) health claims. The Report also sets out what the ASA has been doing to tackle them so that consumers and businesses get a fair deal.

  • Free trials: last year, the ASA banned several ads where customers were unwittingly tied into an on-going paid relationship with an advertiser after signing up for a free offer.  The ASA says that it remains alert to tackling this worrying practice and warning consumers to read the small print carefully before handing over any payment details;
  • Misleading pricing: the ASA claims that its action has already led to more transparent pricing in the hotels sector, getting them to include VAT in their advertised room prices, and in the telecoms sector through clearer information on price packages that include several elements, e.g. broadband, line rental, call costs and TV;
  • Daily deals: the ASA says that it found widespread problems such as failing to conduct promotions fairly, not making clear significant terms and conditions, failing to provide evidence that offers were available and making exaggerated savings claims.  The ASA claims that its action has resulted in a wholesale shift in the way “daily deals” companies now approach their advertising and has led to a welcome fall in complaints and a real improvement in the way daily deals are promoted;
  • Misleading testimonials: testimonials must be genuine and must not be edited in a way that misleads.  The ASA says that it has been busy working to improve transparency around paid endorsements.  For example, its rulings against celebrity tweets have set a clear benchmark that requires advertisers to make it obvious when the tweet is a paid-for commercial message; and
  • Misleading health claims: false claims can have serious consequences by discouraging people from seeking proper medical advice.  Many of these claims are made online.  The ASA says that it is taking action where it can.  By taking action and raising awareness, the ASA says that it plays an important part in protecting consumers from misleading and potentially harmful ads. 

To read the press release in full and for a link to the Annual Report, click here.

ASA finds Curry’s “cashback” tablet ad misleading for failing to make clear total extent of financial commitment needed to redeem offer.

A voice-over in the TV ad stated “At Currys PC World, get up to £80 Cashback on tablets and e-readers when you buy a case too”.  It featured various tablets and e-Readers, for example, an image of a Blackberry Playbook appeared on screen along with two price bubbles that stated “£119” and “after £10 Cashback”.  At the bottom of the screen text stated “£129 payable in store plus cost of case.  Make your Cashback claim between Day 30 & 60. See [website].”

In response to the complaint that the ad was misleading because it did not make clear the extent of the consumers’ commitment in order to obtain the advertised discounts, DSG said that the ad clearly stated that a case needed to be purchased.  It added that because the extent of the commitment was dictated by the customer’s choice of case at various prices, the precise cost could not be known.

The ASA considered that the ad made clear that the cashback offer was dependent upon viewers purchasing the device plus a case and accepted that it would not be feasible to include all of potential amounts consumers could spend and also take advantage of the offer.  However, because the ad featured a price claim and the cashback offer was based on a minimum spend (on device and the cheapest available case), the ASA applied Code rule 3.23 (“if the price of one product or service depends on another, advertisements must make clear the extent of the commitment consumers must make to obtain the advertised price”).  In this case the “extent of the commitment” included the financial commitment. 

The ASA therefore considered that a “from” price for a case should have been included in the ad and  that without this information, the ad contained insufficient information about the minimum financial commitment upon which the cashback offer was based to allow consumers to make an informed decision about whether or how to buy the product.  As such the ASA concluded that the ad was misleading by omission and breached rules BCAP Code rules 3.1 and 3.2 (Misleading advertising), 3.18 and 3.23 (Prices).  To read ASA Adjudication on DSG Retail Ltd (1 May 2013), click here.

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