Overseas organisations advertising to Australians will now be caught by various industry codes prescribed by the Australian Association of National Advertisers (AANA), due to a recent update to the AANA Practice Note.

In Australia, the AANA has designed and delivered a self-regulatory system of standards and rules controlling advertising and marketing communications in Australia. The AANA Code of Ethics (Code of Ethics) provides the overarching set of principles with which all advertising and marketing communications, across all media should comply, and is supplemented by the AANA Practice Note (Practice Note), which acts as a guide to understanding the AANA's intent in relation to the Code of Ethics.

The AANA Practice Note was updated 1 June 2015 and includes a significant change that will affect overseas organisations that "direct" their advertising to Australian consumers. The previous Practice Note stated that the Code of Ethics only applies where the advertising or marketing communications (under the control of the advertiser) have an Australian-customer link (which means any of the customers of the product or service are physically present in Australia), and which are under the control of an Australian company.

This meant that if you were a foreign advertiser and you engaged in online advertising specifically targeted towards Australians, you would not be caught by the Code of Ethics, as long as you were not under the control of an Australian company.

The new Practice Note has been updated to capture any advertising or marketing communications where there is an Australian-customer link and the advertising or marketing communications are directed to those customers. Directing advertising to Australian customers requires more than simply placing an advertisement on an international website. If the website has a country drop down list that makes it specific to Australia, the ad is placed on a ".com.au" website, an "au" webpage of a ".com" website or is addressed to Australians through the wording or content of the ad then it is more likely to be considered to be "directed to Australian customers."

Advertisers operating overseas that wish to advertise in the Australian market are already required to comply with the Australian Consumer Law and other industry specific advertising laws and codes. Now these companies must ensure they also comply with the Code of Ethics and all other related codes including the AANA Code for Advertising & Marketing Communications to Children and the AANA Food & Beverages – Advertising & Marketing Communications Code.

If advertisers do not comply with the Code of Ethics they may receive a non-binding determination from the Advertising Standards Board that they are in breach and are required to moderate or remove the ad. The greater risk is often the social backlash/reputational damage advertisers will suffer. In addition, advertising that is in breach of the Code of Ethics due to issues of truthfulness, or accuracy will also be in breach of provisions of the Australian Consumer Law, and the attention sparked by a complaint to the Advertising Standards Board could also result in an investigation by the Australian Competition and Consumer Commission (an Australian statutory consumer watchdog), court action and fines.

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