Spain brokers advertising deal

Date: 02/11/1995

By Fiona McHugh

GERMANY, France, Belgium and Luxembourg may soon have to change their laws to allow advertisers to make comparisons between different products, if consumer ministers agree to a plan put forward by the Spanish presidency.

Whether such advertisements should be allowed in the EU has long been the subject of heated discussions between member states because of differences in existing national laws over what is and what is not permitted.

Germany, France, Belgium and Luxembourg, where such advertisements are effectively banned, have fiercely opposed any relaxation of their national laws. But most other countries have fought hard for a liberal EU-wide approach, arguing the bloc's patchwork of rules impedes pan-European advertising campaigns.

After lengthy discussions, a breakthrough is now in sight, with all countries except Luxembourg saying they will probably agree to a Spanish compromise text at a meeting of EU consumer affairs ministers next Thursday (9 November).

That would make comparative advertising legal throughout the Union, but only under strict conditions.

“The Spanish presidency has staked out the middle ground between the two opposing camps, and all but one country, Luxembourg, now seem happy with the text,” says one official close to the talks.

If the draft rules are adopted, comparative advertisements would be allowed, but only if they were not misleading and did not compare products with established trade marks. This means, for example, that Ford, Fiat or Rolls Royce could not run advertisements saying their cars were as good as or better than BMWs.

“That question held up the talks for some time because it was inconceivable for Germany that Honda should be allowed to compare its cars with BMWs or Mercedes,” explained one diplomat.

Another article in the draft text, included to appease France, says that comparisons between similar products should only be allowed if the goods in question come from the same region and are of the same quality. In other words, Australian sparkling wine could not be compared with champagne.

The proposed rules also state that bans on tobacco advertising, for instance, and those for toys or doctors and lawyers, which exist in certain member states, should not be undermined by comparative advertisements.

While details still have to be worked out by ministers, broad agreement has been reached in the Council of Ministers working group, sources say. Luxembourg still opposes the compromise text, but it could be outvoted by the other 14 member states. “We have been put in a minority of one and that makes it almost impossible for us to defend our position,” admits one Luxembourg official.

Representatives of the advertising industry appear to be divided in their attitude to the proposed new rules. Michel Deurinck, Secretary-General of the European Advertising Tripartite, says his organisation is in favour of strict conditions, but advertising agencies say restrictions would curb their artistic freedom.

The proposal, which would amend an existing directive on misleading advertising, is for a so-called 'maximum' directive which means that member states would not be allowed to impose tougher standards. It was first introduced in 1991, but was put on the back burner after member states failed to agree on a common approach in 1992.

Spain has revived the plan, making it a priority for its EU presidency.