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Print articleAlcohol and Tobacco Advertising on Television
March, 2003 - Sergiy V. Tkachenko
Legal Framework for Advertising and Restrictions on Advertising of Tobacco Products and Alcoholic Beverages
Advertising activity in Ukraine is regulated mainly by the Advertising Act1 and the Television Act2. The Advertising Act contains several various restrictions and bans relating to the advertising of tobacco products and alcoholic beve-rages. One of the most stringent restrictions applies to tobacco products and alcoholic beverages advertising on TV and radio. In accordance with Article 21 of the Advertising Act and Article 31 of the Television Act, advertising of tobacco products and alcoholic beverages on TV and radio is prohibited.
Current situation as to advertising of alcoholic beverages
It is worth noting that tobacco producers do not promote their products on TV in Ukraine. But at the same time, the lion’s share of prime time on Ukrainian TV channels is devoted to advertising of alcoholic beverages, particularly hard liquors and wines. Advertising of alcoholic beverages is carried out by means of promoting alcohol producers’ brand names and trademarks. Taking into account the fact that advertising of alcoholic beverages is a very important component of business for producers and one of the major sources of income for TV companies, they both have tried to avoid the ban by stating that TV commercials bear no direct reference to the alcoholic beverages. They argue that it is not advertising of alcoholic beverages, but just advertising of brand names and trademarks of various products, including alcoholic beverages. Therefore, such advertising shall not be subject to any restrictions and bans provided by Ukrainian law.
It appears that such arguments are merely a way to bypass the ban on advertising. It is absolutely clear for advertising professionals, lawyers and even consumers that the prime motive behind the use of a brand or a trademark is promotion of a product which brand name or trademark is widely recognized, namely the promotion of alcoholic beverages. This advertising strategy is called “brandstretching”. Brand-stretching is one of the forms of indirect advertising carried out through the use of brand names, trademarks, emblems, logos, slogans and other distinctive features of products which faced a ban on direct advertising. Ukrainian legislation doesn’t contain any special provision related to indirect advertising issues. Therefore, it is unclear whether TV promotion of alcoholic beverages and tobacco products trademarks, brand names and logos is banned in Ukraine. The State Committee on Standardization, Metrology and Certification, as authorized state body in this area, does not carry out activities directed towards prevention of such advertising. Besides, there are no case judgments or court clarifications relating to the ban of tobacco products and alcoholic beverages advertising which could make the provisions of the Advertising Act clearer and better defined.
Russian experience
In the absence of clear provisions of Ukrainian legislation and case judgments with regard to indirect advertising and for the purposes of understanding recent draft amendments to the Advertising Act, familiarization with Russian experience in this field of law and practice may be useful and interesting.
A few years ago similar situation appeared in Russia. According to Article 16 of the Russian Advertising Act3, “advertising of alcoholic beverages, tobacco and tobacco products shall be prohibited from broadcasting on TV and radio from 7 a.m. till 22 p.m.” Some alcohol and tobacco producers tried to circumvent the act by using trademarks and brand names in their TV commercials. Such indirect advertising was used for promotion of, for example, Martini (vermouth produced by Baccardi-Martini group), Magna (cigarettes produced by R.J.Reynolds Tobacco company), Dovgan (vodka produced by Dovgan group), Kremlyovskaya de luxe (vodka produced by Kremlyovskaya company) trademarks. The antimonopoly agencies which are authorized to monitor the compliance with advertising acts in Russia ruled to stop advertising of tobacco- and alcohol-related trademarks and imposed fines on such advertisers and TV companies for violation of Article 16 of the Russian Advertising Act. Some of the advertisers and TV companies brought actions to courts, but unsuccessfully. The courts supported the antimonopoly agencies, dismissed the claims and ruled that use of trademarks, brand names or other distinctive features of alcohol or tobacco products without direct reference to the products themselves shall be considered as advertising of tobacco products and alcohol beverages4. Thus, it can be concluded that indirect advertising of tobacco and alcohol beverages on TV is restricted in Russia.
Prospective Ukrainian advertising legislation
The situation described in previous passages is to be changed in the near future. There are several draft amendments to the Advertising Act which have been developed on the basis of European and Russian experience and contain provisions aimed at regulation of direct and indirect advertising of tobacco products and alcoholic beve-rages, including restrictions and bans on TV advertising. The main provisions of these drafts relating to restrictions and bans on tobacco and alcoholic beve-rages advertising on TV are as follows:
— Advertising of tobacco products or trademarks (i) duly registered in Ukraine or (ii) applied for registration with the authorized state authority or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 34th class of International Classification of Goods and Services (Tobacco) on TV and radio shall be banned.
— Advertising of alcoholic beverages or trademarks (i) duly registered in Ukraine or (ii) duly applied for registration or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 33rd class of International Classification of Goods and Services (Alcoholic beverages) on TV and radio shall be permitted only at night time.
— Sponsorship of TV and Radio programs, broadcasting of sponsored programs, theatrical performances, entertainment, sport, etc. on TV and radio with use of trademarks (i) duly registered in Ukraine or (ii) duly applied for registration with the authorized state authority or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 33rd and 34th class of International Classification of Goods and Services shall be permitted for programs to be broadcasted only at night time.
— The advertising of promotion campaigns for the purpose of increasing sales volume of tobacco products and alcohol beverages by use of trademarks (i) duly registered in Ukraine or (ii) duly applied for registration with the authorized state authority or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 33rd and 34th class of International Classification of Goods and Services shall be permitted only at night time.
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Advertising activity in Ukraine is regulated mainly by the Advertising Act1 and the Television Act2. The Advertising Act contains several various restrictions and bans relating to the advertising of tobacco products and alcoholic beve-rages. One of the most stringent restrictions applies to tobacco products and alcoholic beverages advertising on TV and radio. In accordance with Article 21 of the Advertising Act and Article 31 of the Television Act, advertising of tobacco products and alcoholic beverages on TV and radio is prohibited.
Current situation as to advertising of alcoholic beverages
It is worth noting that tobacco producers do not promote their products on TV in Ukraine. But at the same time, the lion’s share of prime time on Ukrainian TV channels is devoted to advertising of alcoholic beverages, particularly hard liquors and wines. Advertising of alcoholic beverages is carried out by means of promoting alcohol producers’ brand names and trademarks. Taking into account the fact that advertising of alcoholic beverages is a very important component of business for producers and one of the major sources of income for TV companies, they both have tried to avoid the ban by stating that TV commercials bear no direct reference to the alcoholic beverages. They argue that it is not advertising of alcoholic beverages, but just advertising of brand names and trademarks of various products, including alcoholic beverages. Therefore, such advertising shall not be subject to any restrictions and bans provided by Ukrainian law.
It appears that such arguments are merely a way to bypass the ban on advertising. It is absolutely clear for advertising professionals, lawyers and even consumers that the prime motive behind the use of a brand or a trademark is promotion of a product which brand name or trademark is widely recognized, namely the promotion of alcoholic beverages. This advertising strategy is called “brandstretching”. Brand-stretching is one of the forms of indirect advertising carried out through the use of brand names, trademarks, emblems, logos, slogans and other distinctive features of products which faced a ban on direct advertising. Ukrainian legislation doesn’t contain any special provision related to indirect advertising issues. Therefore, it is unclear whether TV promotion of alcoholic beverages and tobacco products trademarks, brand names and logos is banned in Ukraine. The State Committee on Standardization, Metrology and Certification, as authorized state body in this area, does not carry out activities directed towards prevention of such advertising. Besides, there are no case judgments or court clarifications relating to the ban of tobacco products and alcoholic beverages advertising which could make the provisions of the Advertising Act clearer and better defined.
Russian experience
In the absence of clear provisions of Ukrainian legislation and case judgments with regard to indirect advertising and for the purposes of understanding recent draft amendments to the Advertising Act, familiarization with Russian experience in this field of law and practice may be useful and interesting.
A few years ago similar situation appeared in Russia. According to Article 16 of the Russian Advertising Act3, “advertising of alcoholic beverages, tobacco and tobacco products shall be prohibited from broadcasting on TV and radio from 7 a.m. till 22 p.m.” Some alcohol and tobacco producers tried to circumvent the act by using trademarks and brand names in their TV commercials. Such indirect advertising was used for promotion of, for example, Martini (vermouth produced by Baccardi-Martini group), Magna (cigarettes produced by R.J.Reynolds Tobacco company), Dovgan (vodka produced by Dovgan group), Kremlyovskaya de luxe (vodka produced by Kremlyovskaya company) trademarks. The antimonopoly agencies which are authorized to monitor the compliance with advertising acts in Russia ruled to stop advertising of tobacco- and alcohol-related trademarks and imposed fines on such advertisers and TV companies for violation of Article 16 of the Russian Advertising Act. Some of the advertisers and TV companies brought actions to courts, but unsuccessfully. The courts supported the antimonopoly agencies, dismissed the claims and ruled that use of trademarks, brand names or other distinctive features of alcohol or tobacco products without direct reference to the products themselves shall be considered as advertising of tobacco products and alcohol beverages4. Thus, it can be concluded that indirect advertising of tobacco and alcohol beverages on TV is restricted in Russia.
Prospective Ukrainian advertising legislation
The situation described in previous passages is to be changed in the near future. There are several draft amendments to the Advertising Act which have been developed on the basis of European and Russian experience and contain provisions aimed at regulation of direct and indirect advertising of tobacco products and alcoholic beve-rages, including restrictions and bans on TV advertising. The main provisions of these drafts relating to restrictions and bans on tobacco and alcoholic beve-rages advertising on TV are as follows:
— Advertising of tobacco products or trademarks (i) duly registered in Ukraine or (ii) applied for registration with the authorized state authority or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 34th class of International Classification of Goods and Services (Tobacco) on TV and radio shall be banned.
— Advertising of alcoholic beverages or trademarks (i) duly registered in Ukraine or (ii) duly applied for registration or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 33rd class of International Classification of Goods and Services (Alcoholic beverages) on TV and radio shall be permitted only at night time.
— Sponsorship of TV and Radio programs, broadcasting of sponsored programs, theatrical performances, entertainment, sport, etc. on TV and radio with use of trademarks (i) duly registered in Ukraine or (ii) duly applied for registration with the authorized state authority or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 33rd and 34th class of International Classification of Goods and Services shall be permitted for programs to be broadcasted only at night time.
— The advertising of promotion campaigns for the purpose of increasing sales volume of tobacco products and alcohol beverages by use of trademarks (i) duly registered in Ukraine or (ii) duly applied for registration with the authorized state authority or (iii) protected in Ukraine according to international treaties, to which Ukraine is a party, in 33rd and 34th class of International Classification of Goods and Services shall be permitted only at night time.
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