Novelties Introduced by the Regulation on Commercial Advertising and Unfair Commercial Practices
Abstract
Purpose of this article is to examine novelties that are introduced by the Regulation on Commercial Advertising and Unfair Commercial Practices (“New Regulation”) and to discuss whether those novelties are capable of addressing the problems that occurred in practice during the validity period of the former Regulation on Principles and Implementation Guidelines for Commercial Advertising and Announcements (“Former Regulation”) and the problems that still continue to exist in the practice as of today.
Within this scope, we will first analyze the New Regulation and the problems occurred during the validity period of the Former Regulation. Furthermore, we shall briefly discuss novelties that are brought up by the New Regulation which are significant, and shall be examined with regards to the frequently encountered problems in practice. Eventually, we will conclude that the novelties brought up by the New Regulation are capable of addressing the problems that have occurred during the validity period of the Former Regulation, which still continue to exist as of today.
1. INTRODUCTION
The New Regulation entered into force through publication by the Official Gazette numbered 29232, dated 10.01.2015. Before the New Regulation came into force1, related provisions of the Law on Consumer Protection numbered 6502 (“LCP”) and the provisions of the Former Regulation which was introduced in accordance with the former Law on Consumer Protection numbered 4077 (“Former Law”), had been applied to the disputes related to the advertisements.
Aforementioned situation causes a problem in practice, since the Former Regulation was introduced in accordance with the provisions of the Former Law and was not in conformity with the provisions of the LCP. In this respect, it has been realized that it aimed to cover the lack of legal aspects and to solve the issues in the advertising law through the implementation of the New Regulation.
In conjunction with the New Regulation, more extensive regulations than the Former Regulation are implemented by taking into consideration the interests of the consumers.
2. EVALUATIONS REGARDING THE PROVISIONS THAT ARE INTRODUCED AND AMENDED BY THE NEW REGULATION
2.1. Comparative Advertising
Comparative advertising constitutes the advertisement whereby features of rival products or services are directly or indirectly employed in commercial activities of products or services.
There were some differences between the provisions of the LCP and Former Regulation regarding the comparative advertising between the enforcement date of the LCP and the New Regulation. That is to say, as stated in the 5th subsection of Article 61 of the LCP that comparative advertising of the rival goods and services of which fulfill the identical needs or aims to achieve identical purposes could be made.
However, even though the comparative advertisings is allowed according to the provision, the issues regarding the implementation of those advertisements are not clarified; e.g. it is not clear whether the competitor companies can use each other’s trademarks/products in their advertising.
Pursuant to Article 11 of the Former Regulation, comparative advertisings could be made only if; (i) the name of the product, service or trademark is not indicated, (ii) the compared products or services bears the same qualifications and features or satisfies the same requests and needs, and (iii) it is in accordance with the principles of fair competition and the consumers are not mislead in this regard.
Even though it is possible to make comparative advertising in accordance with the LCP, uncertainty is inevitable in practice, since the scope of the comparative advertising is not stipulated under the LCP. Likewise, the Board of Advertisement has shown strict and prohibitive attitude in its decisions regarding comparative advertising and even the smallest implication of comparison was considered unlawful due to the reason that the purpose of denigration exists in the advertisement thereby.
For instance, the Board of Advertisement, within its examination of the file numbered 2014/635; regarding an advertisement with a slogan of “Do not risk your safety”, have concluded that the slogan and the advertising “imply that the private services provide vehicle maintenance and repair services in accordance with the all legislations and standards are not safe, denigrate the same and constitute an unfair competition; therefore such advertisements are deceptive and misleading for the consumers and contrary to the legislation.”
Board of Advertisement has decided for the file numbered 2013/398 regarding an advertisement of a GSM company that the expression of “[X]2 is the Most Advantageous Aloft – Ashore. Choose one of the advantageous[X]’s roaming packages while travelling abroad and talk at an affordable price”, makes a comparison with other GSM operators; thus the expressions within the advertising are deceptive for the consumers and contrary to the principles of fair competition.
Likewise, when the precedents of the Board of Advertisement are analyzed, it is observed that the Board of Advertisement is quite strict against comparative advertising and interprets the relevant provisions of the Former Regulation regarding comparative advertising severely.
The most extensive amendment brought by the New Regulation is regarding the comparative advertising, then, according to the New Regulation, comparative advertising can be made by using the competitor company’s trademark, commercial title, business name or any other distinguishing mark or product or services. However, pursuant to Article 8 of the New Regulation, there are several restrictions regarding comparative advertising.
In this regard, comparative advertising can be made only if; they are not deceptive and misleading, they do not cause an unfair competition, compared products or services bears the same qualifications and features or satisfies the same requests and needs, the compared issue is in favor of the consumer, one or more than one substantive, essential, verifiable and typical features of the products or services, including their prices, compared objectively, objective, measurable claims and the claims based on the numerical data that have been made prove with scientific tests, reports or documents, it does not denigrate or discredit the intellectual and industrial property rights, commercial title, business name, other distinguishing marks, products, services, activities or other characteristics of the competitor companies, products or services are in the same geographical places for the comparison of the products and services of which the origins are stated, the trademarks, commercial titles, business name and other distinguishing marks or products or services of the advertiser and the competitor does not make a confusion.”
Moreover, pursuant to second subsection of Article 8 of the New Regulation, name, trademark, logo or other distinguishing figures or expressions and commercial titles or business names of the competitor companies can be used in the comparative advertisement provided that is in accordance with the aforementioned conditions.
Even though many restrictions regarding comparative advertising are stipulated by such provision of the New Regulation, the usage of trademarks, commercial titles, business names or other distinguishing marks or products or services of the competitor companies in the comparative advertisement is allowed under the Turkish law for the first time.
However, it should be noted that the second subsection of Article 8 of the New Regulation regarding the comparative advertising will enter into force as of January 10, 2016, which is one (1) year later from the date of publication thereof.
2.2. Burden of Proof and Its Scope
The New Regulation aims the information in the contents of the advertising to rely on more concrete and scientific data by stipulating stricter rules on the conclusiveness thereof, compared to the Former Law and Former Regulation.
Even though the Former Regulation stated that the descriptions regarding verifiable facts, claims or sampled statements were required to be proved with regards to the burden of proof, there were no concrete criteria of circumstances under which this liability should be fulfilled.
According to Article 9 of the New Regulation, it is obligatory to prove the descriptions regarding verifiable facts, claims or sampled statements in the advertisements with reports obtained from the related departments of universities or accredited testing and evaluation institutions or independent research institutions.
Furthermore, pursuant to Article 9 of the New Regulation, it is required that the scientific relevance of researches and works of which were made in the advertisers’ own laboratory or centers should be confirmed by the related departments of universities or accredited testing and evaluation institutions so as to be considered as an evidence.
The aim of the novelties that are brought by the New Regulation is to prevent the preparation and publishing of the advertisements that are misleading the consumers and not based on concrete and scientific data.
The Board of Advertisement proceeds to render judgments in accordance with the novelties that are brought by the New Regulation. In this respect, it has been decided through one of its examinations3 regarding the expressions on the package of a cleaning sponge that, “the claim of ‘Absorbs water up to 20 times of its weight.’ does not fulfill the conditions that are stipulated with Article 9 of the Regulation on Commercial Advertising and Unfair Commercial Implementations as there is no information that the tests which are submitted to prove the claim and were made in the own laboratories of the [X]4 , were performed on the advertised products, moreover, they were not made by independent and accredited laboratories either.”
2.3. Testimonial Advertisements
In accordance with Article 12 of the Former Regulation, it was stipulated that any testimonies or consents which are fictitious and are not based on the experience of the testifier, shall not be included or referred within the testimonial advertisements and the testimonies or consents that become invalid or inapplicable due to any other reason, shall not be used therein either.
In accordance with the New Regulation, restrictions stipulated under the Former Regulation are reserved. However, Article 16 of the New Regulation brought on some additional restrictions on health declarations or displays, statements or references which can create an impression thereon of doctors, dentists, veterinarians and pharmacists and health institutions that provide these products and services cannot be included in the advertising.
It is understood that with the restrictions set forth in the New Regulation, the aim is to prevent the advertising that could deceive customers with the statements of doctors and dentists and which is constantly encountered in practice.
2.4. Covert Advertisements
Covert advertising refers to appearance and presentation the trademarks, logos or commercial titles and business names with any other distinguishing marks of goods and services for advertisement purposes in the articles, news, publications or programs without explicitly stating that it is an advertisement.
As the provisions set forth in the Former Regulation regarding the covert advertisements were inadequate, limitations were determined through the decisions of the Board of Advertisement. Therefore, even though the covert advertising was not allowed in accordance with subsection (d) of Article 5 of the Former Regulation, since the limitations on the covert advertising has not been regulated therein, the discretion has been granted to the Board of Advertisement in that matter. It is observed that the Board of Advertisement has shown strict attitude in its previous decisions regarding the covert advertisements. Likewise, the Board of Advertisement decided5 to impose an administrative fine and suspend an advertisement within the crossword puzzle of a newspaper due to the following reasons: “there are various questions within the crossword puzzle and a blank was designated for Formula car which has a tobacco advertisement of the [X]6 thereon. And it is understood through the examinations of the questions that there is no question regarding Formula and furthermore covert advertisement of a tobacco brand which is prohibited to make explicit advertisements, is made within the crossword puzzle.”
New Regulation embodies the limitations regarding covert advertisements by stipulating more detailed and extensive provisions thereof and prohibits the usage of audio, written and visual covert advertisings within all of the communication instruments.
In accordance with Article 23 of the New Regulation, following criteria shall be taken into consideration during the evaluation of covert advertisements: name, trademark, logo, or any other distinguishing figures and expressions, commercial titles or business names with the information and images of the institutions and persons that represent those should be compatible, literal and proportional in respect to the format of the article, news, publications or program in which they are stated and subject, content, presentation, orientation and the time period thereof; articles, news, publications or programs that are prepared within the framework of rights of communication, publication and demanding an information should satisfy the enlightenment and clarification requirements of the customers; renting or purchasing of products or services should not be encouraged by referring specific advertising references for the products and services which could be influenced preferences of the customers.
We are of the opinion that provisions that are stipulated by the New Regulation will eliminate the uncertainties in the decisions of the Board of Advertisement on covert advertisements and arbitrary decisions given by its own discretion as a result of the intangibility of the previous provisions in this respect.
In accordance with second subsection of Article 22 of the New Regulation regarding covert advertising, advertisements cannot be used in a way that would affect the editorial independencies of the media institutions. As the concept of “editorial independency” is intangible and controversial, it may cause some uncertainties and differences in practice due to the specification thereof. Such uncertainties can only be enlightened by the decisions of the Board of Advertisement and the Council of State.
3. CONCLUSION
New Regulation protects the interests of the consumer and brings various provisions in this regard. The New Regulation stipulates significant limitations on advertisements, particularly regarding the burden of proof, and also initiates the comparative advertising.
Nevertheless, there are still some outstanding issues which have not been resolved by the New Regulation. Pursuant to sub-section 7 of Article 61 of the LCP, advertisers, advertisement agencies and media institutions are obliged to comply therewith regarding the restrictions on advertisements.
However, it is not clearly stated who will be responsible for which liability. Even though this issue was not clear during the validity period of the Former Regulation, it was stipulated that the advertisers, publicists and the media institutions and their mediators would be liable to comply with the restrictions on advertisements; the media institutions and their mediators that publish, deliver, distribute or submit the advertisements should be obliged to take due care and attention in the accepting and publishing an advertising.
As the distribution of liability was not clearly regulated, the media institutions were acting as the Board of Advertisement in practice. Nonetheless, it was expecting that such uncertainties were resolved by the New Regulation; however, the distribution of the liability shall again be determined in practice since any relevant provision is not regulated therein.
As for the sanctions, provisions of the LCP shall be applied and advertisers, advertising agencies and media institutions that breach the related provisions thereof shall be imposed to suspension, amendment by using the same methods or administrative fine and cautionary suspension up to three months, if necessary. The Board of Advertisement may impose those sanctions simultaneously or separately due to the qualification of the violation. However, the issue of which sanctions shall be imposed and who will be held liable for the obligations is still ambiguous; and it is expected to become definite through the decisions of the Board of Advertisement. Thus, we are in the opinion that the number of the Board of Advertisement’s decisions on sanctions could be raised in conjunction with such new provisions.
Footnote
1 Article 34 of the Regulation stipulates that the Article 8, paragraph 2 will come into force one (1) year after the date of publishing and other provisions will come into force from the date of publishing of the Regulation. Article 8 paragraph 2 is about comparative advertising.
2 The name of the company has been replaced by [X].
3 Examination regarding the file numbered 2014/1868 which is published in the Press Bulletin dated 12.05.2015.
4 The name of the company has been replaced by [X].
5 Examination of the document numbered 2013/167 which is published in the Press Bulletin dated March 12, 2013.
6 The name of the company has been replaced by [X].
