On 20 December 2010, Ofcom published statements in respect of the Broadcasting Code Review concerning product placement and commercial references on television programming, and paid-for references to brands and products in radio programming.

As part of the implementation of the Audiovisual Media Services Directive in the UK and following a recent Ofcom consultation, new rules are to be introduced to allow product placement in UK television programmes, and references to brands or products in radio programmes. However, although removing the prohibition on product placement, the new Broadcast Code will still contain a number of restrictions, including in respect of products that can be placed, and the types of programme in which product placement will still be prohibited. The new rules will largely reflect the proposals set out in the Ofcom consultation.

The new rules relating to radio programming took immediate effect, having been incorporated into Section 10 of the new Broadcasting Code, which was also published on 20 December 2010. The new rules relating to television programming will come into force as a new Section 9 to the Broadcasting Code on 28 February 2011. Until that date, commercial references in television programmes must comply with Sections 9 and 10 of the Broadcasting Code (as currently in force). Accordingly, product placement on UK-produced television programmes will not take place until the new rules come into force. 

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On 20 December 2010, Ofcom published its Broadcasting Code Review statements concerning product placement and commercial references on television programming and paid-for references to brands and products in radio programming. Click here.

Radio programming

The new rules relating to radio programming took immediate effect, having been incorporated into Section 10 of the new Broadcasting Code (the "Code"), which was published on 20 December 2010.

As a result of the Code, radio stations now have discretion to integrate paid-for, promotional references to products or brands into programming, provided that such integration has been made clear to listeners. However, Section 10 of the Code prohibits commercial references in or around news bulletins and programmes aimed at children. Ofcom has highlighted the importance of transparency of commercial arrangements, so as to ensure consumer protection. Accordingly commercial arrangements must be appropriately signalled to listeners, and spot advertising (i.e. adverts in commercial breaks) must be kept separate from commercial references in radio programmes.

Television programming

The new rules relating to television programming will come into force on 28 February 2011, when a new Section 9 will be implemented into the Code. Until that date, all commercial references in television programmes must comply with Sections 9 and 10 of the Code (as currently in force) and accordingly, product placement on UK-produced television programmes is still prohibited.

From 28 February 2011, product placement (which will be defined in the Code as the "inclusion in a programme of, or reference to, a product, service or trade mark, for a commercial purpose, in return for payment or other valuable consideration to any relevant provider or any person connected with a relevant provider, and is not prop placement") will be permitted in certain types of television programmes.

The new Section 9 of the Code will permit product placement in television programmes falling within the following genres: films (and single dramas), documentaries, television series (including soap operas), entertainment shows and sports programmes. However, product placement will not permitted during children's programmes (i.e. programmes "for viewing primarily by persons under the age of sixteen") or news programmes. Additionally, as a result of concerns raised in Government consultations on this matter, product placement will remain prohibited in current affairs programmes, consumer advice programmes and religious programmes that are produced under UK jurisdiction.

The new Section 9 of the Code also restricts the types of products that can be placed on television programmes. The placement of tobacco products and prescription medication is banned in all programmes. Certain products and services that cannot be advertised on television – such as weapons and escort agencies – are also banned from product placement. In respect of programmes produced under UK jurisdiction, alcohol products, gambling products, foods or drinks that are high in fat, salt or sugar, medicines, and baby milk (including follow-on formula) cannot be used in product placement.

The 2011 revision to the Code implements the explicit requirements of the Communications Act 2003, which was amended to implement the provisions of the Audiovisual Media Services Directive and Ofcom has emphasised that product placement must not compromise the editorial independence of broadcasters. The Code explicitly requires that advertising and editorial content must remain separate, and accordingly provides that references to placed products must not be unduly prominent or promotional. In addition, product placement must be justified and must not compromise editorial independence; for example, a story line must not be paid for. The new Section 9 of the Code also introduces revised rules on sponsorship of television programmes in light of the changes to product placement rules, and allows sponsors to use product placement in programmes they are sponsoring.

To ensure transparency and that viewers are aware of the use of product placement, a logo must appear on the screen at the beginning and end of a programme that contains product placement, as well as when the programme recommences after commercial breaks. The logo should appear for at least three seconds, according to Ofcom guidance. Prior to 28 February 2011, Ofcom will issue the universal logo which will be used to signify the use of product placement, and to alert consumers further to the use of product placement, commercial television stations have also been asked to run awareness campaigns.

Comment

Ofcom has stated that the new rules "will enable commercial broadcasters to access new sources of revenue, whilst providing protection for audiences". Although the value of the changes to the rules in unclear, one product placement company has estimated that product placement could become worth at least 5% of the total UK TV advertising market, as is the case in the US.

However, the new rules for radio programming have already attracted criticism for preventing sponsored news bulletins in an integrated market where internet radio providers do not face the same restrictions. It will be interesting to see how the television programme product placement rules are received by both broadcasters and consumers when they enter into force on 28 February 2011, and in particular, whether the new Section 9 of the Code will sufficiently balance the need for transparency and editorial independence with the benefits to corporate entities and broadcasters of the use of product placement.

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The original publication date for this article was 18/01/2011.