The Advertising Standards Authority of South Africa has had a tough time lately. Financially strapped and forced to undertake an indfunding drive just to stay afloat, it has also had the extent of its jurisdiction challenged in court.
The ASA is a self-regulatory body created by the advertising and marketing industries to establish and enforce standards and principles for advertising in South Africa. As such, membership of the ASA has always been voluntary. However, most advertisers or at least the media owners through which advertising is published are, at least indirectly, members of the ASA by virtue of their being members of industry bodies which are ASA members, such as the Association for Communication and Advertising, Print Media South Africa, the National Association of Broadcasters and the Direct Marketing Association of South Africa, to name but a few.
Insofar as complaints against non-members are concerned, the ASA's previous practice was always to nevertheless forward those complaints to the advertisers and ask them to respond. The ASA took the view that, where the respondent filed a response or appeared at a hearing, it was essentially submitting to its jurisdiction. Where the respondent did not respond, the ASA would nevertheless make a ruling and even sanction the respondent if it did not comply.
Herbex (Pty) Limited, a manufacturer of various slimming products and other complementary medicines, was no stranger to the ASA. Although not a member of the ASA, whether directly or indirectly, it had been on the receiving end of a number of complaints over the years, primarily from consumers who were unhappy with claims made about its slimming products. Herbex had to defend these allegations and did so with varying degrees of success. Many complaints did not end well for it and resulted in the ASA ordering it to withdraw or amend its advertising.
Clearly fed-up by repeatedly having to make an appearance at the ASA, Herbex challenged the jurisdiction of the ASA in court on the grounds that the ASA has no jurisdiction over non-members. It claimed that it had been induced to respond to complaints and defend itself at hearings before the ASA by misleading statements and non-disclosures in the ASA's standard letters. Herbex also claimed that that ASA's actions were unconstitutional, in violation of its rights of freedom of expression and trade and that the ASA's rulings against Herbex had adversely affected its reputation and damaged its business.
The High Court upheld this claim and declared that all rulings issued by the ASA against Herbex or other non-members were void. The ASA appealed the matter to the Supreme Court of Appeal, however, which recently handed down an order to which both parties had consented. The order declared that the ASA has no jurisdiction over any person or entity who is not a member of the ASA and that the ASA may not, in the absence of submission to its jurisdiction, require non-members to participate in its processes, or issue any instruction, order or ruling against the non-member or sanction it.
Critically, however, the SCA also declared that the ASA may consider and issue a ruling to its members (which is not binding on non-members) on any advertisement regardless of by whom it is published, to determine, on behalf of its members, whether its members should accept any advertisement before it is published or should withdraw any advertisement if it has been published.
While the first court's ruling had effectively tied the ASA's hands completely in respect of making decisions concerning the advertising of non-members, the SCA's order has overturned this and has once again opened the door for the ASA to consider all advertising. While it cannot make a ruling against or sanction a non-member, it can advise its members (who include most printers, broadcasters and other media owners) that certain advertising contravenes the ASA Code so that its members may choose not to accept the advertising for publication or withdraw it if it has already been published. In this way, the public will hopefully still be protected against advertising which contravenes the ASA Code.
With its jurisdiction no longer in question, the ASA has been able to turn its full attention to becoming financially stable once again. It has launched a new funding model involving a voluntary 0.1% levy on advertising and it seems that the ASA is back on track to becoming the reliable industry watchdog it has always been.
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