Advertising, Marketing & Promotion Comparative Guide

1 Legal framework

1.1 What are the main legislative and regulatory provisions that govern advertising in your jurisdiction?

Advertising is regulated in Australia through both legislative and self-regulatory systems.

The primary piece of legislation is the Australian Consumer Law (ACL) (Schedule 2 to the

Competition and Consumer Act 2010, which prohibits, among other things:

• misleading or deceptive conduct (including conduct that is likely to mislead or deceive); and
• the making of false or misleading representations.

Australia's advertising industry self-regulatory system includes a number of self-regulatory codes of practice developed by the Australian Association of National Advertisers (AANA), including:

• the AANA Code of Ethics;
• the AANA Food and Beverages Code;
• the AANA Code of Advertising and Marketing Communications to Children;
• the AANA Environmental Claims Code; and
• the AANA Wagering Advertising and Marketing Communications Code.

The AANA codes are administered by Ad Standards, the regulator and administrator of Australia's advertising industry self-regulatory system. Ad Standards also administers:

• the Federal Chamber of Automotive Industries (FCAI) Voluntary Code of Practice for Motor Vehicle Advertising (FCAI Code) on behalf of the FCAI; and
• the Alcohol Beverages Advertising Code (ABAC) on behalf of the ABAC Scheme.

1.2 Which bilateral or multilateral instruments or treaties with effect in your jurisdiction (if any) have particular relevance for advertising in your jurisdiction?

Australia's competition and consumer protection regulator, the Australian Competition and Consumer Commission (ACCC), is a party to a number of multilateral and bilateral cooperation agreements and memorandums of understanding with other national competition and consumer protection agencies in jurisdictions such as Canada, China, Europe, Fiji, Italy, Japan, Korea, New Zealand, Papua New Guinea, the Philippines, Taiwan, Thailand, the United Kingdom and the United States. The agreements and memorandums aim, among other things, to:

• promote cooperation and coordination in relation to competition and consumer protection enforcement activities; and
• reduce spam and facilitate the enforcement of spam-related issues.

In addition, Ad Standards is a founding member of the International Council for Ad Self-Regulation, a global platform promoting responsible ads through the effective implementation of self-regulatory standards.

1.3 What industry codes or guidelines have relevance for advertising in your jurisdiction?

Australia has industry and product-specific legislation. For example, state and territory.

Food Acts:

• prohibit misleading or deceptive conduct in relation to food advertising, packaging and labelling; and
• require compliance with the Australia and New Zealand Food Standards Code (FSC).

Similarly, the advertising of therapeutic goods must comply with the Therapeutic Goods Advertising Code 2021 (TGAC), which has the force of law.

Further, the Corporations Act 2001, the Australian Securities and Investments Commission (ASIC) Act 2001 and the National Consumer Credit Protection Act 2009 (incorporating the National Credit Code) all include provisions dealing with misleading or deceptive conduct in relation to the advertising of credit and financial products.

More recently:

• to combat ‘greenwashing', the ACCC has issued draft guidance for businesses in relation to environmental and sustainability claims; and
• the Australian Health Practitioner Regulation Agency has issued new guidelines for the advertising of cosmetic surgery by medical practitioners.

As noted in question 1.1, there are also a number of advertising industry self-regulatory codes administered by Ad Standards.

1.4 Which bodies are responsible for implementing and enforcing the advertising regime in your jurisdiction? What is their general approach in doing so?

The ACCC is the federal government regulator for the ACL and it both investigates and enforces contraventions of the ACL. Fair trading offices also investigate and enforce the ACL at the state and territory level.

There are also industry-specific government departments, such as:

• state and territory food authorities, which administer the FSC;
• the Therapeutic Goods Administration, which administers the TGAC; and
• ASIC, which regulates legislation applicable to the advertising of financial and credit products.

Generally, regulators such as the ACCC will:

• investigate misleading or deceptive advertising practices under the ACL; and
• once it has determined that a breach has occurred, either:
• • issue an infringement notice;
  • accept a court-enforceable undertaking to cease the conduct complained of; or
  • commence court proceedings seeking orders for:
  • • declarations;
    • injunctions;
    • pecuniary penalties;
    • corrective advertising; and/or
    • the implementation of compliance programmes.

Ad Standards receives and determines consumer complaints in relation to the AANA codes and the FCAI Code. Other industry bodies, such as the ABAC Scheme, determine complaints in relation to their own industry codes (although those industry codes may be administered by Ad Standards).

Ad Standards administers its industry codes through the Ad Standards Community Panel and the Ad Standards Industry Jury. The former responds to consumer complaints about advertisements alleged to be offensive, violent or sexist; whereas the latter is a form of alternative dispute resolution for competitors where allegations of misleading or deceptive conduct are made.

If the Community Panel or Industry Jury determines that an ad does not comply with an industry code, it will ask the advertiser to modify or withdraw the ad. If the advertiser does not comply, Ad Standards may:

• report such failure in a public case report; and
• refer the report to an appropriate regulator.

2 Authorisation and clearance

2.1 Do advertisers need any kind of licence or authorisation in order to operate in your jurisdiction?

Generally, no licence or authorisation is required to advertise in Australia.

Certain goods, such as goods that make therapeutic claims, must be listed or registered in the Australian Register of Therapeutic Goods before such claims can be advertised.

2.2 Do ads require any kind of clearance before they can be released in your jurisdiction?

Advertising on commercial television must be classified by ClearAds. ClearAds' primary role is the classification of ads for the purpose of timing placement. While ClearAds also reviews the substantiation of claims in advertising, any approval of advertising or otherwise by ClearAds does not guarantee compliance with the advertising laws.

3 General advertising regime

3.1 What general rules and requirements apply to ads in your jurisdiction?

The Australian Consumer Law (ACL) is the main statute which governs advertising claims. Its provisions have wide scope and prohibit:

• misleading or deceptive conduct in trade or commerce (including conduct that is likely to mislead or deceive); and
• the making of false or misleading representations, including but not limited to, in relation to:
• • the standard, quality, value or grade of goods or services;
  • the performance characteristics, accessories, uses or benefits of goods or services;
  • sponsorship, approval or affiliation;
  • testimonials;
  • the price of goods or services;
  • the place or origin of goods or services; and
  • the existence, exclusion or effect of any condition, warranty, guarantee, right or remedy, including in relation to non-excludable guarantees under the ACL.

In addition to the ACL, advertisers should consider whether any product-specific legislation applies which may prescribe conditions under which certain claims can be made. For example, Standard 1.2.7 of the Australia and New Zealand Food Standards Code contains extensive regulation in respect of the making of nutritional, health and related claims for foods.

In relation to the advertising industry self-regulatory regime administered by Ad Standards, in respect of consumer complaints the Australian Association of National Advertisers (AANA) Code of Ethics:

• prohibits the portrayal of people or depiction of material in such a way that discriminates against or vilifies a person or section of the community;
• prohibits the employment of sexual appeal in respect of minors or in a manner which is exploitative or degrading;
• prohibits the presentation or portrayal of violence, unless it is justifiable;
• requires advertisers to treat sex, sexuality and nudity with sensitivity;
• requires advertises only to use language which is appropriate in the circumstances;
• prohibits the depiction of material contrary to prevailing community standards on health and safety; and
• requires advertising to be clearly distinguishable as such.

3.2 What rules and requirements apply to puffery in your jurisdiction?

A certain degree of puffery or exaggeration is generally accepted in the ordinary course of commercial dealings.

Puffery will not be considered misleading or deceptive if the claims are so overly exaggerated, imaginative or vague that no reasonable person could possibly take them seriously.

3.3 Under what circumstances must claims in ads be substantiated?

Generally, claims which are capable of objective assessment or comparative claims will require substantiation, as these types of claims have a greater likelihood of being misleading if incorrect, in comparison to clearly fanciful or non-comparative claims.

That said, some types of advertising claims do not require substantiation – for example, puffery. Whether an advertising claim will require substantiation will depend on all of the facts and circumstances of the particular case.

There are no specified standards as to the type of proof necessary to substantiate an advertising claim. However, evidence should be robust, credible and able to resist objective scrutiny.

3.4 What rules and requirements apply to the use of the following? (a) Test results; (b) Survey results and (c) Testimonials.

(a) Test results

There are no specific rules that apply to the use of test results. However, if advertising claims are based on test results:

• such claims should be accurate and truthful;
• particular care should be taken to ensure that the test has been conducted properly;
• tests should be objective, unbiased and employ sound methodology; and
• the results of the tests should provide a reasonable basis for the substantiation of the claim, as overstating or exaggerating test results is likely to amount to misleading or deceptive conduct.

(b) Survey results

If advertising claims are based on the results of surveys:

• the claims should be accurate and truthful;
• particular care should be taken to ensure that the survey has been properly conducted (eg, language used, questions asked, methodology employed and sample size);
• surveys should be objective, unbiased and employ sound methodology; and
• the results of a survey should be relied upon only if the results are statistically significant.

(c) Testimonials

The ACL specifically prohibits, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services, the making of:

• a false or misleading representation that purports to be a testimonial by any person relating to goods or services; or
• a false or misleading representation concerning:
• • a testimonial by any person relating to goods or services; or
  • a representation that purports to be such a testimonial relating to goods or services.

In light of the above, testimonials should:

• be genuine and legitimate; and
• reflect typical cases and the actual experience of the individual giving the testimonial.

In general, it is recommended that:

• the advertiser obtain permission from the individual to use the testimonial; and
• a signed record of the testimonial be retained for substantiation purposes.

3.5 What rules and requirements apply to the protection of minors?

The Broadcasting Services (Australian Content and Children's Television) Standards 2020 prohibits broadcasters from broadcasting TV ads that:

• mislead or deceive children;
• put undue pressure on children to purchase products; or
• are unclear in the presentation of the product.

The Standards also:

• contain specific requirements regarding the use of disclaimers and references to premium offers and competitions in TV ads to children;
• prohibit the broadcast of TV ads during preschool classified programmes;
• restrict the broadcasting of TV ads during C classified programmes; and
• prohibit the broadcast of TV ads to children that:
• • demean persons on the basis of race, nationality, ethnicity, gender, sexual preference, religion or mental or physical disability;
  • show images or events that are unduly frightening or distressing to children; or
  • show unsafe uses of a product.

Further, the AANA Code for Advertising and Marketing Communications to Children is a self-regulatory code of practice that regulates the content of ads directed primarily at children. ‘Children' refers to persons that are 14 years old or younger. The code:

• sets out an overarching requirement that ads primarily directed at children must not contravene ‘prevailing community standards'; and

• contains specific restrictive provisions or prohibitions in relation to:
• • the factual presentation of ads;
  • placement;
  • sexualisation;
  • safety;
  • social values;
  • parental authority;
  • qualifying statements;
  • competitions;
  • popular personalities;
  • premiums;
  • alcohol;
  • privacy; and
  • food and beverages.

3.6 Are certain forms of advertising prohibited in your jurisdiction?

Section 35 of the ACL prohibits ‘bait advertising', which is where a person advertises goods or services for sale at a specified price, although there are reasonable grounds for believing they are not actually able to offer the goods or services at that price. A typical example is the ‘bait and switch', where a retailer offers goods for sale at an extremely good price, knowing that it only has a limited number of the good for sale, for the purposes of drawing in customers so that they can be persuaded to purchase alternative – typically more expensive – goods from the retailer.

Section 49 of the ACL also prohibits referral selling schemes, where consumers are persuaded to buy goods or services by promising benefits (including commissions, rebates or other benefits) contingent on subsequent sales or events occurring after the contract is made.

4 Misleading advertising

4.1 On what grounds will an ad be found to be misleading in your jurisdiction? How does the process unfold?

As far as the misleading or deceptive conduct provisions of the Australian Consumer Law are concerned, the standard that is applied in determining whether an advertising claim is misleading or deceptive (or is likely to mislead or deceive) is whether, in the context of the advertising claim, ordinary and reasonable persons of the class of persons to whom the advertising claim is directed are likely to be misled or deceived. The intention of the advertiser is irrelevant.

The advertising claim, when considered in context, must lead or be likely to lead a person into error. Mere confusion or wonderment is insufficient.

In determining whether the advertising claim is likely to mislead or deceive, the question is whether there is a "real or not remote chance or possibility regardless of whether it is less or more than fifty per cent" that an ordinary and reasonable person in the circumstances would be misled or deceived.

4.2 If an ad is found to be misleading, what are the consequences for the advertiser?

Where an advertising claim is found to be misleading, the consequences for the advertiser will vary depending on who makes the determination that the advertising claim is misleading.

For example, if the determination is made by Ad Standards as a consequence of a competitor complaint to the Industry Jury, Ad Standards will request the advertiser to modify or withdraw the ad as soon as possible after making a determination. If the advertiser does not do so, Ad Standards may:

• report such failure in a public case report;
• send the report to relevant media proprietors;
• publish the report on its website; and
• if considered appropriate, refer the report to an appropriate government regulator (eg, the Australian Competition and Consumer Commission (ACCC)).

On the other hand, if the ACCC determines that an advertising claim is misleading, it may:

• issue the advertiser with an infringement notice; or
• accept court-enforceable undertakings in which the advertiser:
• • acknowledges that the advertising claim was misleading;
  • undertakes to cease making the advertising claim; and
  • may undertake to publish corrective ads and implement a compliance programme.

If the determination is made by a court as a result of proceedings commenced by the ACCC, declarations, injunctions, pecuniary penalties and court costs (in addition to the publication of corrective advertising and the implementation of a compliance programme) are usually ordered.

The maximum pecuniary penalty for a corporation is the greater of:

• A$50 million;
• if the court can determine the value of the ‘reasonably attributable' benefit obtained, three times that value; or
• if the court cannot determine the value of the ‘reasonably attributable' benefit, 30% of the corporation's adjusted turnover during the breach turnover period for the contravention. ‘Adjusted turnover' refers to the sum of the value of all the supplies that the corporation (and any related corporation) has made or is likely to have made during the breach turnover period, with some exclusions. The breach turnover period will generally represent the duration of the breach, but 12 months is the minimum period over which the sum is calculated.

If the determination is made by a court as a result of proceedings commenced by a competitor, declarations, injunctions, damages and court costs are usually ordered.

4.3 Can the advertiser appeal the decision? If so, what is the process for doing so?

A determination made by Ad Standards via the Industry Jury or by the ACCC is not appealable.

However, the ACCC cannot compel an advertiser to pay an infringement notice penalty or to provide it with an undertaking. Where an advertiser refuses, the ACCC is likely to consider other enforcement options, such as court proceedings.

Court decisions can be appealed. To succeed in an appeal, the appellant must establish that:

• the Judge at first-instance made an error of law (eg, applied an incorrect principle of law or made a finding of fact which could not be supported by the evidence); and
• the error was of such significance that the decision should be overturned.

5 Specific advertising regimes

5.1 What rules and requirements apply to the following types of advertising in your jurisdiction, and what best practices should be considered in each case? (a) Comparative advertising; (b) Promotional marketing (eg, competitions, lotteries and sweepstakes); (c) Interest-based advertising (ie, tailored advertising based on data collected from internet browsing); (d) Native advertising; (e) Influencer advertising; (f) Ambush marketing; (g) Country-of-origin marketing; and (h) Green marketing.

(a) Comparative advertising

While there are no specific rules or restrictions that apply to comparative advertising claims, special care should be taken when making comparative claims. This is because:

• comparative claims are generally more likely to mislead or deceive if the comparison is inaccurate as opposed to non-comparative claims; and
• comparative claims are more likely to be scrutinised by a competitor.

Section 122(1)(d) of the Trade Marks Act 1995 provides that a registered trademark is not infringed if a person uses the trademark for the purposes of comparative advertising.

On the other hand, if the trademark is a logo and constitutes an artistic work, no such comparative advertising exception exists under the Copyright Act 1968. However, Section 67 of the Copyright Act 1968 provides that copyright in an artistic work is not infringed by its incidental inclusion in a film or broadcast (eg, a TV ad). What is meant by ‘incidental' is a question of fact; however, provided that the artistic work in question is not the main or central focus of the film or broadcast, it is more likely to be considered incidental. That said, in the context of a comparative TV ad, where the main or central focus of the ad is a comparison between the advertiser's product and the competitor's product, it is difficult to envisage a situation where the inclusion of the competitor's logo or other artistic works would not be part of the main or central focus of the TV ad.

(b) Promotional marketing (eg, competitions, lotteries and sweepstakes)

Sweepstakes (called ‘trade promotion lotteries' or ‘games of chance' in Australia) are regulated at the state and territory level; although overarching federal legislation – such as the misleading or deceptive conduct provisions of the Australian Consumer Law (ACL) and the provisions of the Privacy Act 1988 – also applies to the conduct of trade promotion lotteries and games of skill. No specific legislation exists in relation to the conduct of games of skill; although, like games of chance, games of skill are subject to the provisions of the ACL and the Privacy Act 1988.

Of the eight states and territories, four require either a permit, licence or authority to be obtained in order to conduct a trade promotion lottery depending on the value of the total prize pool. Those four states and territories and their respective threshold total prize pools are as follows:

• New South Wales: More than A$10,000.
• South Australia: More than A$5,000.
• Northern Territory (NT): More than A$5,000 (however, the NT does not require a permit to be obtained if another state or territory has already issued a permit).
• Australian Capital Territory: More than A$3,000.

Irrespective of whether a permit, licence or authority is required in respect of a trade promotion lottery, the sponsor or promoter of a trade promotion lottery must comply with each state and territory's legislative and lottery office requirements in relation to the conduct of a trade promotion lottery. Entry to a trade promotion lottery must be free, but proof of purchase of a good or service as a condition of entry is permissible.

(c) Interest-based advertising (i.e., tailored advertising based on data collected from internet browsing)

The Privacy Act 1988 does not apply to advertisers targeting consumers using information which is not about either:

• an identified individual; or
• an individual who is reasonably identifiable.

Interest-based advertising is conducted by collecting web browsing activities and linking this to certain non-identifying information, such as an IP address, in order to direct targeted ads to web pages visited by the user of that IP address. Accordingly, no personal information is being collected, used or disclosed and the Privacy Act 1988 does not apply.

Importantly, even if the information used by advertisers does not constitute ‘personal information' on its own, it must be treated as personal information and the Privacy Act 1988 will apply if it can be connected with other information:

• held by the business (even if it is stored separately) or a related entity; or
• which is reasonably accessible based on the ‘motivated intruder' test,

that, when connected, it is capable of identifying an individual.

Accordingly, the more information that is collected, the easier it becomes to identify an individual and the more likely it is that the Privacy Act 1988 will apply.

The Australian Best Practice Guideline for Online Behavioural Advertising:

• sets out self-regulatory principles for interest-based advertising; and
• aims to:
• • promote transparency and consumer awareness; and
  • encourage best practice and accountability.

Further, the 2023 Privacy Act Review Report contains a number of proposals that would give individuals more control and transparency in respect of direct marketing, targeting and trading of their personal information.

(d) Native advertising

There are no special rules that apply to native advertising in Australia. However, the misleading or deceptive conduct provisions under the ACL and the Australian Association of National Advertisers (AANA) Code of Ethics apply equally to native advertising.

Section 2.7 of the AANA Code of Ethics requires that advertising be clearly distinguishable as such. The practice note elaborates that, for example, advertising should not be disguised as news, current affairs, independent market research, user-generated content, private blogs or independent reviews. There is no requirement that advertising be labelled as such; however, it must be clear to the audience that it is commercial in nature.

Accordingly, it is incumbent on an advertiser to ensure that native advertising clearly and prominently discloses that the content is a paid ad for the advertiser as opposed to editorial or entertainment content.

(e) Influencer advertising

There are no special rules or regulations that apply to the use of influencer campaigns. The provisions of the ACL and the various AANA codes and other industry codes of practice apply equally to influencer campaigns. That said, the current concern with social media influencers not disclosing, or not appropriately disclosing, their commercial arrangements with advertisers – as is required under the clearly distinguishable advertising requirement under Section 2.7 of the AANA Code of Ethics – has given greater prominence to that requirement. Such conduct can also amount to misleading or deceptive conduct under the ACL.

In addition, the Australian Influencer Marketing Council's Australian Influencer Marketing Code of Practice 2023 sets out best practice disclosure requirements in respect of influencer marketing which reiterates both:

• the clearly distinguishable advertising requirement of the AANA Code of Ethics; and
• the requirement to comply with the misleading or deceptive conduct provisions of the ACL.

Under the AANA Code of Ethics, an advertiser can be held liable for the content posted by its influencers provided that it has a reasonable degree of control over the content that the influencers post. However, as an influencer or an advertiser has yet to be sued by a regulator (eg, the Australian Competition and Consumer Commission (ACCC)) for engaging in misleading or deceptive conduct under the ACL in respect of content posted by an influencer, it is not entirely clear whether an advertiser would be held liable for that content.

(f) Ambush marketing

In Australia, there is specific ambush marketing legislation that applies in certain circumstances. Examples include the following:

• The Olympic Insignia Protection Act 1987 prohibits all unauthorised commercial use of the word ‘Olympic' and other Olympic expressions.
• Event-specific legislation is often enacted for major sporting events. For example, the Sydney 2000 Games (Indicia and Images) Protection Act 1996 (now repealed) prohibited the unauthorised use of Sydney 2000 games indicia or images for commercial purposes. The Explanatory Memorandum emphasised that the purpose of the act was to preserve the financial integrity of the games which could be adversely affected by ambush marketing. Similar legislation has been enacted in respect of the Melbourne 2006 Commonwealth Games and the Grand Prix.
• At a federal level, the Major Sporting Events (Indicia and Images) Protection Act 2014 provides that a person cannot use a major sporting event's protected indicia or images for commercial purposes during the event's protection period, unless the person is an official user for the event. The list of major sporting events which are protected by the act is updated regularly.
• Major events legislation in many Australian states and territories also prohibits the unauthorised commercial use of official insignia and advertising visible from event venues (including aerial advertising) to assist with the prevention of ambush marketing.

In addition, the usual ACL provisions apply, including in respect of:

• conduct that is misleading or deceptive; and
• false or misleading representations about sponsorship, approval or affiliation.

Victims of ambush marketing can also seek redress through the common law tort of passing off.

(g) Country-of-origin marketing

Claims about where a product's ingredients or components came from or where it was processed are ‘country of origin' claims and are regulated under the misleading or deceptive conduct and/or false and misleading representations provisions of the ACL. Country of origin claims include claims that a product was ‘made', ‘produced' or ‘grown' in a certain country:

• ‘Made in …' claims refer to the production of the product – that is, the goods must have been substantially transformed in the country of origin being claimed.
• ‘Product of …' claims are used to demonstrate that:
• • each significant component or ingredient of the goods originated in the country of origin being claimed; and
  • the production processes took place in that country.
• ‘Grown in …' claims are used to demonstrate that:
• • each significant ingredient or significant component was grown in the country of origin being claimed; and
  • the production or manufacturing processes occurred in that country.

In addition, food offered for retail sale in Australia must carry country of origin labelling under the Country of Origin Food Labelling Information Standard 2016, made under the ACL. The standard aims to make it easier for consumers to see where their food originates from.

(h) Green marketing

Australia regulates environmental claims in ads in two ways.

First, the AANA Environmental Claims Code is a self-regulatory code of practice administered by Ad Standards that regulates the making of environmental claims' in ads. The term ‘environmental claim' is defined to mean:

Generally, the code requires environmental claims to:

• be presented truthfully and factually;
• provide a genuine benefit to the environment; and
• be capable of substantiation.

Second, the provisions of the ACL prohibiting conduct that is misleading or deceptive (or is likely to mislead of deceive) and/or the making of false or misleading representations apply equally to environmental claims, or ‘greenwashing'. In December 2023, the ACCC published a guide for businesses in respect of environmental and sustainability claims. The guide sets out the following principles for ‘trustworthy environmental claims':

• Make accurate and truthful claims.
• Have evidence to back up claims.
• Do not hide or omit important information.
• Explain any conditions or qualifications to claims.
• Avoid broad and unqualified claims.
• Use clear and easy to understand language.
• Ensure that visual elements do not give the wrong impression.
• Be direct and open about the environmental sustainability transition.

6 Direct marketing

6.1 What rules and requirements apply to the following types of direct marketing in your jurisdiction, and what best practices should be considered in each case? (a) Telemarketing; (b) Email marketing; (c) Direct mailings; and (d) Opt-out marketing.

(a) Telemarketing

The Do Not Call Register Act 2006 (DNCRA) prohibits the making of unsolicited telemarketing calls to a telephone number registered on the Do Not Call Register, unless the account holder of the telephone number has consented to receiving the call.

The Do Not Call Register is a database in which individuals can register their numbers to opt out of most unsolicited telemarketing calls.

A business must crosscheck its marketing lists against the Do Not Call Register to ensure that it does not call those numbers. If a business outsources telemarketing calls, both the business and the service provider are responsible for complying with the DNCRA.

Failure to comply with these obligations can result in substantial penalties and injunctions. Infringement notice penalties range up to A$313,000 for each day on which contraventions occurred. A court may award significantly higher penalties, with a maximum penalty of A$3,130,000 for each day on which contraventions occurred.

(b) Email marketing

Email marketing is regulated by the Spam Act 2003.

The Spam Act 2003 provides that commercial electronic messages (where the purpose of the message is to offer, advertise or promote the supply of goods or services) with an ‘Australian link' require:

• the express or inferred consent of the recipient;
• the inclusion of information about the individual or organisation that authorised the sending of the message; and
• a functional unsubscribe facility.

An ‘Australian link' includes any message that originates in Australia, where the sender is present in Australia or where the recipient is in Australia.

Failure to comply with these obligations can result in substantial penalties and injunctions. The Australian Communications and Media Authority recently issued an infringement notice which required the Commonwealth Bank of Australia to pay a penalty of A$3,552,000 for breaching the Spam Act 2003 by sending commercial electronic messages without consent and a functional unsubscribe facility.

(c) Direct mailings

Under Australian Privacy Principle 7, an organisation must not use or disclose personal information it holds for the purpose of direct marketing to an individual unless:

• the individual reasonably expects it or consents to it; and
• there is a simple ‘opt-out' process by which an individual can elect not to receive direct marketing communications.

Australian Privacy Principle 7 does not apply in circumstances where the Spam Act 2003 or DNCRA applies.

(d) Opt-out marketing

Under the Spam Act, all commercial electronic messages must include a functional opt-out facility that:

• clearly informs recipients on how to opt out;
• complies with any opt-out request within five business days;
• does not require the payment of a fee;
• does not cost more than the usual amount for sending the message (eg, standard SMS fee);
• is functional for at least 30 days after the message is sent; and
• does not require the recipient to provide additional personal information or to log into, or create, and account to opt out.

Further, Proposal 20.2 of the 2023 Privacy Act Review Report recommends the introduction of an unqualified right for individuals to opt out of their personal information being used or disclosed for direct marketing purposes. The government has agreed in principle to this proposal, subject to refining the definition of ‘direct marketing', and will further consider the best way to harmonise the requirements under the Privacy Act 1988, the Spam Act 2003 and the DNCRA.

7 Indirect marketing

7.1 What rules and requirements apply to the following types of marketing in your jurisdiction, and what best practices should be considered in each case? (a) Product placement; (b) Sponsorship; and (c) Loyalty programmes.

(a) Product placement

From an advertising regulation perspective, there are no special rules in relation to product placement in entertainment content. As with any other form of conduct in trade or commerce, product placement is still subject to the misleading or deceptive conduct provisions of the Australian Consumer Law (ACL).

In relation to the Australian Association of National Advertisers (AANA) Code of Ethics' requirement under Section 2.7 that advertising be clearly distinguishable as such, the ANNA's practice note acknowledges that where advertisers have made commercial arrangements for their branded product to feature as a product placement, no disclosure may be required. This is because the use of the branded product may be sufficient to distinguish the material as an advertisement and/or there is a prevailing community view that audiences need not be notified of this sort of product placement.

(b) Sponsorship

The clearly distinguishable advertising requirement under Section 2.7 of the AANA Code of Ethics equally applies to sponsorship advertising.

Advertisers should be careful not to conceal advertising material within other content; and where it is not readily apparent that such content is sponsored or part of a commercial arrangement, it must be clearly labelled as such. The AANA Code of Ethics practice note provides further guidance for ensuring that advertising content is clearly distinguishable from non-advertising content.

Other industry codes – such as the Commercial Television Industry Code of Practice and the Media Entertainment & Arts Alliance Journalist Code of Ethics – require the disclosure of commercial arrangements. Further, the Commercial Radio Code of Practice requires an ad to be presented in a manner which is clearly identifiable as advertising material.

In addition, the usual ACL provisions apply, including in respect of conduct that is misleading or deceptive (or likely to mislead or deceive) and false or misleading representations.

(c) Loyalty programmes

Any personal information collected from consumers must be handled in accordance with the Privacy Act 1988.

In 2019, the Australian Competition and Consumer Commission (ACCC) conducted a review of customer loyalty schemes. In its final report (dated 3 December 2019), the ACCC recommended the following ways to improve loyalty schemes:

• Terms and conditions should be clearly presented to consumers and any changes should be fair and sufficient notice thereof should be provided.
• Unfair contract terms and certain unfair trading practices should be prohibited.
• The practice of automatically linking members' payment cards to their loyalty programme profile should end to prevent businesses from tracking consumers' purchasing behaviour when they do not scan their loyalty card.
• Loyalty programmes should provide consumers with details about how their personal information is handled and give consumers control over their personal information.
• Protections in the Privacy Act 1988 should be strengthened.

8 Industry-specific regimes

8.1 What regulatory regimes apply to advertising in the following industries in your jurisdiction, and what best practices would you highlight? (a) Gambling (including lotteries); (b) Alcohol; (c) Tobacco; (d) E-cigarettes; (e) Pharmaceuticals (prescription and over-the-counter); (f) Therapeutic products (ie, products which claim to have health benefits but which are not medicines or pharmaceuticals, such as vitamin supplements); (g) Food; and (h) Financial products and services.

(a) Gambling (including lotteries)

The advertising of gambling is highly regulated. The Interactive Gambling Act 2001 regulates the advertising of gambling services via online, a website, an app or a telephone.

(b) Alcohol

Alcohol advertising is also highly regulated. The Alcohol Beverages Advertising Code is a self-regulatory code of conduct which addresses the packaging and advertising of alcohol.

The advertising of alcohol must also comply with other legislative requirements and codes, including:

• the Australian Association of National Advertisers (AANA) Code of Ethics;
• the Australian Consumer Law;
• state and territory liquor licensing alcohol promotion requirements;
• the Australia and New Zealand Food Standards Code (FSC);
• the Commercial Television Industry Code of Practice;
• the Commercial Radio Code of Practice; and
• the Outdoor Media Association Code of Ethics and Alcohol Advertising Policy.
  

(c) Tobacco

Tobacco advertising is banned in Australia and labelling and packaging are also highly regulated under the Tobacco Plain Packaging Act 2011.

(d) E-cigarettes

In Australia, nicotine vaping products, including nicotine e-cigarettes, are regulated as prescription medicines. The advertising of prescription medicines is generally prohibited in Australia. However, a pharmacy that dispenses e-cigarettes on prescription may, under the Therapeutic Goods Act 1989, promote the availability of e-cigarettes to those wishing to fill their prescription.

Individual states and territories may otherwise limit or prohibit the advertising of smoking products, including e-cigarettes and vapes (irrespective of whether they contain nicotine).

(e) Pharmaceuticals (prescription and over-the-counter)

The advertising of prescription-only medicines to the general public is prohibited under the Therapeutic Goods Act 1989.

Non-prescription medicines (or over-the-counter medicines) can be advertised to the general public and are subject to the Therapeutic Goods Advertising Code (TGAC), which prohibits (among other things):

• misleading advertising;
• advertising which arouses unwarranted expectations or causes consumers to self-diagnose;
• the offering of incentives to sales staff; and
• the offering of samples.

The TGAC also deals with the use of:

• testimonials;
• professional recommendations;
• scientific information; and
• comparative advertising.

The TGAC also prescribes wording which must be used in ads.

Prescription-only medicines are also subject to the Medicines Australia Code of Conduct, which provides a principles-based framework for the marketing and promotion of prescription-only medicines.

(f) Therapeutic products (ie, products which claim to have health benefits but which are not medicines or pharmaceuticals, such as vitamin supplements)

Under the Therapeutic Goods Act 1989, a claim that a good is for ‘therapeutic use' will:

• require that the relevant good be listed or registered on the Australian Register of Therapeutic Goods (ARTG) before the claim can be advertised; and
• be subject to the TGAC.

Accordingly, complimentary medicines (eg, vitamin supplements) that make a claim for ‘therapeutic use' (eg, preventing, diagnosing, curing or alleviating a disease, ailment, defect or injury in persons; or influencing, inhibiting or modifying a physiological process in persons) are generally required to be listed on the ARTG before any claims for therapeutic use can be advertised.

Complementary medicines are also subject to the Complementary Medicines Australia Marketing and Supply Code of Practice: Complementary Medicines, which outlines suitable standards of marketing and promotional practices with respect to the supply of complementary medicines.

(g) Food

Food advertising must comply with the FSC, which regulates issues in respect of the use of health, nutritional and advertising claims in ads and on packaging/labelling. There are also various self-regulatory industry codes that deal with food and beverage advertising to children and fast-food advertising directed at children.

(h) Financial products and services

The advertising of financial and credit products is subject to:

• the Corporations Act 2001;
• the Australian Securities and Investments Commission (ASIC) Act 2001; and
• the National Credit Code.

The legislation generally prohibits misleading or deceptive conduct and is supported by ASIC's regulatory compliance guide (RG 234), which details what is expected in relation to:

• disclaimers;
• advertising of returns;
• benefits and risks;
• comparisons;
• use of forecasts;
• information about fees; and
• media-specific related matters.

9 Enforcement

9.1 On what grounds can the following parties take action against ads in your jurisdiction? (a) Competitors; (b) Consumer associations; and (c) Members of the public.

(a) Competitors

Competitors can commence court proceedings against another competitor in respect of alleged contraventions of the Australian Consumer Law (ACL) – for example, in relation to:

• misleading or deceptive conduct; and
• the making of false representations.

The remedies available for actions commenced by competitors include:

• declarations;
• injunctions (including interlocutory injunctions);
• orders for damages; and
• costs.

Competitors may also consider using self-regulatory dispute resolution measures, including lodging a complaint via the Ad Standards Industry Jury (a competitor complaint resolution service provided by Ad Standards).

(b) Consumer associations

Australia's leading consumer association, the Australian Consumers' Association – known as CHOICE – is a consumer advocacy group that campaigns on behalf of Australian consumers. While it conducts product reviews, investigates claims about goods and services and publishes its findings, it does not commence court proceedings or conduct other enforcement actions against advertisers.

Such enforcement measures are left to:

• the national competition and consumer law regulator, the Australian Competition and Consumer Commission (ACCC); and
• the various state and territory fair trading offices.

In particular, the ACCC investigates advertising claims and, if it considers that a contravention of the ACL has occurred, can:

• issue an infringement notice;
• accept a court-enforceable undertaking from the advertiser to cease the conduct complained of; or
• commence court proceedings seeking orders for:
• • declarations;
  • injunctions;
  • pecuniary penalties;
  • refunds;
  • corrective advertising;
  • the implementation of compliance programmes; and/or
  • costs.

(c) Members of the public

Individual consumers have a right of action in respect of alleged contraventions of the ACL. The remedies available for court proceedings commenced by a consumer are the same as those available to competitors.

Consumers can also make complaints to a regulator, such as the ACCC. If a sufficient number of complaints is received or if the conduct complained of is likely to result in significant public detriment, the ACCC may decide to investigate the complaint and/or take action against the advertiser. However, the ACCC is under no obligation to investigate a complaint or take action against an advertiser and may decline to do so.

A consumer may also lodge a complaint with the Ad Standards Community Panel about an ad which he or she considers to be offensive, violent or sexist.

9.2 What mechanisms are available to them to do so, and what are the pros and cons of each?

As set out above, the mechanisms for taking action against ads include the following:

• Commencing court proceedings: Court proceedings are time consuming and cost intensive. However, once an order is made, it is legally enforceable and each party is legally obliged to comply with the order.
• Lodging a complaint through the Ad Standards Industry Jury: Complaints via the Ad Standards Industry Jury are generally much faster and cheaper to obtain; however, decisions of the Ad Standards Industry Jury are not enforceable by a court.
• Lodging a complaint through the Ad Standards Community Panel: Complaints via the Ad Standards Community Panel are free to obtain; however, decisions of the Ad Standards Community Panel are not enforceable by a court and generally do not deal with misleading or deceptive conduct.
• Lodging a complaint with a government regulator (eg, the ACCC): Complaints to the ACCC are free; however, the ACCC is under no obligation to investigate a complaint or take action against an advertiser and may decline to do so.

9.3 How does the procedure typically unfold and how long does it take?

Court proceedings:

• If urgent interlocutory injunctive relief is sought, an interlocutory hearing generally takes place within a couple of weeks of the application and affidavit in support being filed.
• However, if a permanent injunction is sought, the first case management hearing usually takes place within five weeks of filing of the application.
• The court will endeavour to set a hearing date within six months.
• The court will aim to deliver its judgment within three months.

Industry Jury:

• Ad Standards assesses the complaint to determine whether it is eligible for consideration by the Industry Jury.
• The advertiser is notified of the complaint and asked to respond within 10 business days.
• The complainant has seven business days to reply to the advertiser's response.
• The advertiser has seven business days to respond to the complainant's reply.
• The Industry Jury has an opportunity to request additional information. The relevant party has five business days to provide the requested information.
• The Industry Jury must reach a determination and prepare a written determination within 15 business days.

Community Panel:

• Ad Standards assesses the complaint to determine whether it is eligible for consideration by the Community Panel.
• The advertiser is notified of the complaint and asked to respond.
• The Community Panel assesses the ad.
• If the complaint is dismissed, the advertiser is typically notified within 48 hours. If the complaint is upheld, the advertiser is notified and will be asked to change or remove the ad. The advertiser is given five days to respond to the decision.
• Complainants are typically advised of the outcome within 10 days.

ACCC: The ACCC is under no obligation to investigate a complaint and generally does not comment on its investigations.

9.4 What costs are incurred?

Court proceedings can be very expensive and include a range of fees, such as:

• solicitors' fees and disbursements;
• expert witness' fees;
• counsel's (barrister's) fees;
• court fees; and
• other administrative fees (eg, transcript fees).

In addition, an unsuccessful party can expect to be ordered to pay the other side's legal costs.

The Ad Standards Industry Jury is a user-pays service. The ultimate cost depends on the complexity of the complaint. The complainant must pay:

• a non-refundable application fee of A$1,100; and
• a lump sum representing an estimate of the legal and administrative costs of the complaints process, which typically ranges between A$20,000 and A$25,000.

The complainant must also agree to pay all costs associated with the complaints process (to the extent that they exceed the initial cost estimate).

There are no costs involved in making a complaint to the Ad Standards Community Panel or ACCC.

9.5 What defences are typically raised by the advertiser?

Allegations of misleading or deceptive conduct under the ACL are generally defended on the basis that the conduct complained of:

• is not misleading or deceptive; or
• is unlikely to mislead or deceive.

As noted in question 4.1, whether conduct is misleading or deceptive, or is likely to mislead or deceive, is a question of fact to be determined objectively in light of all the relevant facts and circumstances at the time the conduct occurred. Further, the conduct is considered in respect of the class of ordinary and reasonable persons likely to be affected by the conduct.

9.6 What remedies are available?

The remedies available for court actions include:

• declarations;
• injunctions (including interlocutory injunctions);
• orders for refunds;
• damages; and/or
• costs.

9.7 Can the decision be appealed? If so, what is the process for doing so?

As set out in question 4.3, court decisions can be appealed. To succeed in an appeal, the appellant must establish that:

• the Judge at first-instance made an error of law (eg, applied an incorrect principle of law or made a finding of fact which could not be supported by the evidence); and
• the error was of such significance that the decision should be overturned.

A determination of the Ad Standards Industry Jury in relation to a particular complaint is final and not subject to appeal.

In respect of a complaint to the Ad Standards Community Panel, an independent review process is available. Requests for review must be made within 10 business days of the date of the notification of the Community Panel's decision. There are costs associated with lodging a request for review, and certain grounds must be satisfied.

10 Trends and predictions

10.1 How would you describe the current advertising landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

Greenwashing: The ACCC conducted an internet sweep in October 2022 which looked at 247 different businesses and/or brands over eight sectors. The aim of the sweep was to:

• identify industries or sectors which commonly use environmental and sustainability claims; and
• assess whether these claims have the potential to mislead consumers.

The sweep identified the following issues:

• vague and unqualified claims;
• a lack of substantiating information;
• the use of absolute claims;
• the use of comparisons;
• exaggerated benefits or the omission of relevant information;
• the use of aspirational claims, with little information on how these goals will be achieved;
• the use of third-party certifications; and
• the use of images that appear to be ‘trust marks'.

The ACCC has since been investigating a number of businesses to determine whether the various environmental claims being made by these businesses breach the Australian Consumer Law.

Social media influencers: The ACCC conducted an internet sweep in January 2023 to identify misleading testimonials and endorsements by social media influencers. The sectors that were targeted during the sweep included:

• fashion;
• beauty and cosmetics;
• food and beverages;
• travel;
• health, fitness and wellbeing;
• parenting;
• gaming; and
• technology.

In April 2023, the ACCC published its sixth interim report in respect of the Digital Platforms Services Inquiry. In relation to social media influencers, the ACCC found that:

• the disclosure of sponsored posts by influencers needs to be improved; and
• the "lack of disclosure may mislead consumers who may be unaware that endorsements by influencers are paid for, preventing them from making informed choices when purchasing products online".

11 Tips and traps

11.1 What are your top tips for companies that advertise their products and services in your jurisdiction and what potential sticking points would you highlight?

The misleading or deceptive conduct provisions in the Australian Consumer Law (ACL) are very broad and extend to all consumer interactions, including advertising, packaging and statements made by sales staff.

In addition, the Australian Competition and Consumer Commission (ACCC) is a highly proactive regulator. The ACCC regularly conducts internet sweeps to identify any potential contraventions and to enforce compliance with the ACL. Each year the ACCC reviews its compliance and enforcement priorities. Some of its current compliance and enforcement priorities for 2024-25 include:

• consumer, product safety, fair trading and competition concerns in relation to environmental claims and sustainability;
• consumer and fair trading issues in the digital economy, with a focus on misleading or deceptive advertising within influencer marketing, online reviews, in-app purchases and price comparison websites; and
• improving industry compliance with consumer guarantees, with a focus on consumer electronics, and also targeting misconduct by retailers in connection with delivery timeframes.

Given the broad reach of the misleading or deceptive conduct provisions of the ACL and the proactive oversight by the ACCC, it is imperative for businesses to ensure that their advertising practices comply with regulatory standards to avoid substantial penalties.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.