Advertising in South Africa is regulated both by self-regulation and by statute. The International Code of Advertising Practice is largely incorporated into the Code of Advertising Practice of the Advertising Regulatory Board (ARB). This code governs all advertising content, including packaging, in South Africa, but only members of the ARB are obliged to adhere to the code. In general, most advertisers, media agencies and media sources are members and complaints by non-members against other non-members will nonetheless be considered by the ARB.
The ARB code is made up of general principles to be adhered to in advertising and specific regulations applicable to defined products, such as:
- alcohol;
- cosmetics;
- vaping products; and
- social media influencers.
Under statutory compliance, several acts of Parliament are also relevant to advertising regulation, such as:
- the Consumer Protection Act 2008;
- the Copyright Act 1978;
- the Trade Marks Act 1993;
- the Foodstuffs, Cosmetics & Disinfectants Act 1972;
- the Liquor Products Act 1989;
- the Agricultural Products Standards Act 1990; and
- the Protection of Personal Information Act 2013.
These acts also contain regulations that enable matters such as the labelling and marking of specific products.
Furthermore, South Africa’s common law prohibits misleading representations under the delictual actions of passing off or unlawful competition.
The Norma Oficial Mexicana (NOM) which specifies standards for a product to be named or advertised as “Tequila” recently became effective here.
Other geographical indications of origin that protect against the use of certain terms, such as “champagne”; “port”; are protected under the Agreement on Trade-Related Aspects of Intellectual Property Rights and we are a signatory to that agreement.
The ARB Code of Advertising Practice encompasses the general principles that apply to all advertising. It also incorporates industry-specific codes that relate to the following sectors:
- food and beverages;
- cosmetics;
- breast milk substitutes;
- direct marketing;
- environmental;
- alcohol;
- pet food;
- social media;
- vapour products; and
- gambling.
The ARB will decide both competitor and consumer complaints filed under the Code of Advertising Practice. It functions on the premise that all advertising must be:
- legal;
- decent;
- honest;
- truthful; and
- prepared with a sense of responsibility to the public.
Advertising claims are considered within the context in which they are made and complaints always consider the consumer and matters of equity in an open, free and democratic society. The ARB is neither overcautious nor too robust and, in general, its rulings are well considered and respected. The complaints procedure includes several levels of appeal, allowing for full ventilation of a matter.
Complaints filed for contraventions of the labelling and marketing of foodstuffs may be filed with the Government Department of Health. Non-compliance with the regulations under the Agricultural Products Standards Act are dealt with by the Department of Agriculture, Land Reform and Rural Development. Complaints relating to non-compliance with labelling and marking of liquor products are dealt with by both of these government departments. The government departments apply the regulations strictly and narrowly, largely due to the liabilities that follow non-compliance. However, they are open to mediation and discussion around non-compliance with a view to finding solutions.
Advertising that does not comply with the Consumer Protection Act may be reported to the National Consumer Commission (NCC). The NCC has been the subject of scrutiny of late as its efficacy is being called into question.
The Information Regulator enforces compliance with the Promotion of Access to Information Act 2000 and the Protection of Personal Information Act. This regulator is authorised to enforce compliance of both public and private bodies with the rules of those acts. Since its inception in late 2023, the regulator has handed out hefty fines and will apply the laws very strictly.
While media outlets require certain forms of licensing, generally advertisers do not require authorisation or licences to advertise in South Africa.
Generally, no, but it is possible to request pre-approval from the Advertising Regulatory Board.
The preamble to the Advertising Regulatory Board (ARB) Code of Advertising Practice states that all ads should be:
- legal, decent, honest and truthful; and
- prepared with a sense of responsibility to the consumer.
No ad should bring advertising into disrepute or reduce confidence in advertising as a service to industry and to the public; and all advertising should conform to the principles of fair competition in business.
Puffery is regulated under Clause 4 of the ARB Code of Advertising Practice under “truthful presentation”.
The guiding principles are as follows:
- Puffery is:
-
- acceptable when it is an expression of opinion; and
- unacceptable when viewed as an expression of fact;
- It must be clear that what is being expressed is an opinion; and
- There must be no likelihood that the opinion or the way in which it is expressed will mislead consumers about any aspect of a product or service.
All claims – whether express, direct or indirect – that are capable of objective substantiation must be supported by documentary evidence which advertisers must have obtained prior to placing the ad. The evidence must:
- be up to date;
- be current; and
- have market relevance.
(a) Test results
Test results or other types of documentary evidence must:
- emanate from or be evaluated by a person or entity that is independent, credible and an expert in the particular field to which the claims relate; and
- be acceptable to the ARB.
(b) Survey results
Survey results must emanate from an entity that has been approved by or is acceptable to the South African Marketing Association (SAMA). In addition, the accuracy of the claims based on the survey must be confirmed by an entity that has been approved by or is accepted by SAMA.
(c) Testimonials
Testimonials:
- may not contain any statement or implication that contravenes the ARB Code of Advertising Practice;
- should not be misleading; and
- should not contain any claims to efficacy which cannot be justifiably attributed to the use of the product.
Any measurable results claimed should be fairly presented.
All person below the age of 18 are legally regarded as minors in South Africa. All advertising aimed at, featuring or likely to influence minors will be interpreted narrowly and may not take advantage of children’s lack of experience and credulity. Children may not be portrayed:
- as sexually appealing or provocative;
- in any manner that involves sexual innuendo; or
- engaging in dangerous activities.
There are also specific regulations relating to direct marketing to children, which are aimed at protecting personal information of children and focus on the issue of consent.
The advertising, promotion and sponsorship of tobacco are banned, and warnings must appear on the packaging of tobacco products.
Prescription medicines may not be advertised to the public and may only be promoted to healthcare practitioners and then under prescribed conditions.
Currently, the advertising of liquor products is not banned but a law is pending which may change this status quo.
The Advertising Regulatory Board (ARB) Code of Advertising Practice provides that ads should not contain any statement or visual presentation which – directly or by implication, omission, ambiguity, inaccuracy, exaggerated claim or otherwise – is likely to mislead the consumer.
The Consumer Protection Act also provides that suppliers may not market goods or services in a manner that is false, misleading or deceptive regarding, among other things:
- the nature, properties, price or advantages of the goods and services; and
- the sponsorship of any event.
Competitor or consumer complaints against misleading claims filed with the ARB are decided by either:
- the ARB Directorate; or
- the Advertising Industry Tribunal.
Those rulings may be appealed up to several levels and legal representation is not allowed at all levels of appeal.
If the advertiser is a member of the ARB, then, depending on the nature of the advertising complained of, it must be removed from the public domain. Certain forms of advertising require immediate compliance, while others – such as packaging – require longer periods to phase out the offending advertising. The Procedural Guide to the ARB Code of Advertising Practice sets out the timeframes for compliance.
Non-members of the ARB are not bound by rulings against them, but their advertising may be rejected by parties that are members of the ARB.
If a complaint is filed with a government department in terms of statutory non-compliance and that department finds that the packaging is misleading, it will issue a directive accordingly; and if the directive is not complied with, criminal sanctions may apply.
Yes, there are two levels of appeal, depending on which ARB body issued the ruling. Strict timeframes apply for lodging an appeal and legal representation at the hearings of appeals is restricted depending on the ARB body hearing the appeal. Directorate rulings are appealed to the Advertising Appeals Committee (no legal representation) and then a further appeal is available to the Final Appeal Committee, at which legal representation is allowed.
Complaints lodged under statute will be considered by the relevant government department and parties may engage with their representatives for dispensations.
(a) Comparative advertising
Products or services compared should be promoted on their own merits and not on the demerits of competitive products. This is allowed under the Advertising Regulatory Board (ARB) Code of Advertising Practice, provided that certain conditions are met. These include the following:
- There is no disparagement of competitor products;
- No infringement of trademarks occurs;
- Only facts capable of objective substantiation are used;
- The claims made are not misleading;
- There is no infringement of advertising goodwill; and
- The products or services comparted have the same or similar characteristics or purposes.
Best practice tips:
- Do not refer to any trademarks of competitors in comparative advertising.
- Always compare apples with apples.
(b) Promotional marketing (eg, competitions, lotteries and sweepstakes)
The Consumer Protection Act governs promotional competitions and contains provisions aimed at preventing consumers from being misled. A promoter of a competition must also not require any consideration to be paid by a participant other than the reasonable costs of posting or otherwise transmitting an entry form.
The Consumer Protection Act does not distinguish between contests of skill and games of chance and games of chance and/or contests of skill in South Africa need not be registered or approved by a regulatory body. However, they must comply with certain provisions of the Consumer Protection Act and it is advisable to seek legal advice on compliance.
The National Lotteries Commission (NLC), a division of the Department of Trade and Industry and Competition, monitors various lottery competitions in the country. The Lotteries Act 1997 regulates lottery activities and provides the basic framework for the management and operation of the National Lottery.
Private lotteries, such as office sweepstakes which are strictly ‘in-house’, must be self-regulated. Self-regulation of other forms of private lotteries such as lucky ticket draws and raffles will be regarded as ‘exempt entertainment’ under the Lotteries Act and will not require registration with the NLC; but the NLC is empowered to deal with complaints relating to the operation of these types of lotteries.
(c) Interest-based advertising (ie, tailored advertising based on data collected from internet browsing)
There are no express prohibitions on targeted advertising, provided that it is executed according to the provisions of the ARB Code of Advertising Practice and its general principles.
(d) Native advertising
The ARB Code of Advertising Practice requires ads to be clearly distinguishable in whatever form and media they are used – for example, by using:
- the words ‘ADVERTISEMENT’ or ‘ADVERTISEMENT SUPPLEMENT’ in print media; or
- labels such as ‘Sponsored’, ‘Promoted’ or ‘Ad’ on digital platforms.
Social media advertising must be obviously identifiable as such.
(e) Influencer advertising
Appendix K to the ARB Code of Advertising Practice is currently the only regulation on influencer marketing. Generally, transparency is required as to whether content is purely organic or part of a social media campaign. All paid social media content must be clearly identified and influencers must have a written contract detailing:
- their relationship;
- the terms of engagement; and
- remuneration.
No deceptive, false or misleading content is allowed in social media advertising.
(f) Ambush marketing
The Merchandise Marks Act (17/1941) contains provisions for declaring:
- certain marks as ‘prohibited’; and
- certain events as ‘protected’.
If an event is declared a ‘protected event’, third parties are prohibited from using their own trademarks, without authorisation from the organiser of the event, in a manner that is calculated to achieve publicity for the trademark in question and thereby to derive special promotional benefit from the event. This includes any visual or audible use of their trademarks which creates an association with any event. The broad wording of the section is intended to cover parties that commit ambush marketing by intrusion, in addition to those committing ambush marketing by association.
Contravening either the ‘protected event’ or ‘prohibited mark’ provisions of the Merchandise Marks Act is a criminal offence.
(g) Country-of-origin marketing
This is regulated under Regulation 146 of the Labelling and Advertising Regulations to the Foodstuffs, Cosmetics & Disinfectants Act. It is a mandatory labelling requirement. If all the main ingredients, processing and labour used to make the goods are from one specific country, then the wording ‘Product of …’ is required.
Wording such as ‘Produced in …’, ‘Processed in …’, ‘Manufactured in …’ or ‘Made in …’ must be used when a product is processed in a second country which changes its nature.
(h) Green marketing
Appendix G to the ARB Code of Advertising Practice regulates advertising that contains environmental claims. Generally, all environmental claims:
- must be accurate and meaningful; and
- should not be vague, incomplete or misleading.
Absolute environmental claims must be substantiated. General terms such as ‘environmentally friendly’, ‘ozone friendly’ or ‘green’ are not permitted unless qualified by a description of the benefit (eg, “Ozone friendly – free from CFCs”). There are also specific requirements to be met for the use of the terms ‘recyclable’, ‘degradable’ and ‘ozone friendly’.
The Direct Marketing Association of South Africa (DMASA) has developed its own Code of Ethics and Standards of Practice with which all direct marketers should comply. These principles are also regulated under Appendix C of the Advertising Regulatory Board Code.
Appendix C contains a host of provisions aimed at direct marketing to children and advertisers are reminded that children and minors are not adults, and not all marketing techniques are appropriate for them. Particular attention must be given to the guidelines concerning consent, as these provide for the express consent of the child’s parent or guardian.
By way of example, marketers must:
- obtain express consent from a minor for the collection and use of their personal and/or contact information; and
- obtain the express consent of the parent or guardian prior to the disclosure of a child’s or minors contact information to a third party.
Where the minor, parent or guardian withdraws or declines permission to collect, use or disclose a minor’s information, marketers must immediately delete all such information from their database
The Consumer Protection Act and the Protection of Personal Information Act make it illegal for companies to direct unsolicited marketing messages to consumers who have opted out of receiving communication in any direct form.
Best practice tip:
- Advertisers should familiarise themselves with the relevant laws/regulations to ensure that they are aware of the requirements.
(a) Telemarketing
Restrictions apply to the hours of contact and attention must be given to the ‘do not contact’ list on the DMASA’s website where consumers may sign up for ‘no contact’. Restrictions also apply to random and sequential dialling.
Best practice tips:
- Know the parameters of contact and what is acceptable and unacceptable.
- Check names against the DMASA’s ‘do not contact’ list.
(b) Email marketing
No email marketing should be sent without the consent of the recipient, except where an existing business relationship exists. Every email message must:
- clearly identify the marketer and the source of the email; and
- provide the recipient with an easy-to-use method to opt out of receiving communication.
(c) Direct mailings/catalogue marketing
Of paramount importance is the protection of personal privacy. All direct marketing and catalogue marketing communications must identify:
- the marketer’s name; and
- a complete mailing address or telephone number.
(d) Opt-out marketing
This form of marketing is not only restricted to email but covers any form of direct marketing. The DMASA has a registry where consumers may register to opt out of receiving any direct marketing. The registration is valid for three years and can be renewed. In registering, the consumer may elect to opt out of direct marketing in general, or in respect of a particular supplier.
(a) Product placement
The Independent Communications Authority of South Africa has its own set of regulations relating to:
- advertising;
- infomercials;
- product placement; and
- sponsorship.
It provides that all broadcast service licensees must adhere to the Advertising Regulatory Board (ARB) Code of Advertising Practice.
In terms of the regulations under the Independent Broadcasting Authority Act of 1993 (which has since been repealed, although the regulations remain in force):
- no broadcaster may permit any product placement in any news or current affairs programme transmitted by it; and
- product placement in programming other than news and current affairs must be subordinate to the content of the programme material.
Best practice tips:
- Ensure that the consent of the relevant trademark owner of the goods to be placed is secured.
- Ensure that there is no disparagement of the trademark in the placement itself.
(b) Sponsorship
Other than the regulations referred to above, with which broadcasters should comply, there are no specific requirements for advertising by way of sponsorship. In general, the sponsorship should be identified. The general principles of the ARB Code regarding misleading claims and those that require substantiation should also apply.
Best practice tip:
- Where necessary, ensure that consent for the use is obtained prior to the use itself.
(c) Loyalty programmes
These are regulated under the Consumer Protection Act which provides, among other things, that such programmes must clearly state:
- what the consumer must do to participate or to receive benefits; and
- the details of who the consumer can contact to get access to the programme or loyalty credits or awards.
The company offering the loyalty programme must also ensure that the goods and services offered are available to fulfil the reasonably anticipated demand.
Best practice tips:
- Ensure that sufficient credits or awards are available to participating consumers.
- Do not charge consumers for administration, processing or handling of the transaction.
(a) Gambling (including lotteries)
The National Gambling Act (2004) and its regulations are incorporated as an appendix to the Advertising Regulatory Board (ARB) Code of Advertising Practice. They regulate the advertising of gambling services in South Africa.
In general, the advertising of gambling:
- must not be false or misleading;
- must not contain indecent language, images or actions;
- must not portray excessive play;
- must not present gambling as an alternative to employment or to acquire financial security; and
- must not imply that gambling involves skill or that it is a form of investment.
Gambling activities may not be advertised in a manner that is targeted at or designed to attract minors; and no advertising for gambling may portray people engaged in gambling activities who are or appear to be younger than 18.
All gambling advertising must contain a statement warning against the dangers of addictive and compulsive gambling.
There are also specific requirements that apply to the different media used for promoting gambling.
(b) Alcohol
The advertising of alcohol products is regulated by both statute and self-regulation. The Liquor Act 2003 and the Liquor Products Act (both subject to amendment which has not yet been approved by Parliament) regulate:
- the times and place of sale for liquor products; and
- the labelling of certain alcoholic beverages.
Beer is governed under the Foodstuffs Act, but this will change when the new law comes into force. The Liquor Products Act and regulations define the nature, composition and labelling of liquor products and compliance is strict.
The Association for Alcohol Responsibility and Education (AWARE.org) is a self-regulated body that promotes the responsible marketing and use of alcohol in South Africa. Most local producers of alcoholic beverages are members of AWARE.org and several retailers are associate members.
AWARE.org and the Drinks Federation of South Africa have produced the Alcohol Industry Communications Code of Conduct, which regulates responsible and ethical commercial communication. This code of conduct is also incorporated into the ARB Code of Advertising Practice.
Among other things, the Alcohol Industry Communications Code of Conduct regulates:
- the use of warning labels, which are clearly defined; and
- age verification on social media sites.
No ads for competitions related to an alcohol brand should be directed at persons under the legal drinking age, which is 18 in South Africa.
Alcohol-free and non-alcoholic beverages may only be promoted to people of legal drinking age and all commercial communications for these products must comply with all requirements of the Code of Conduct for alcohol-branded commercial communications.
As the landscape is due to change for alcohol advertising, alcohol advertisers should stay abreast of developments to remain compliant once the new statute comes into effect.
(c) Tobacco
Tobacco advertising is regulated by the Tobacco Products Control Act, which prohibits the advertising and promotion of tobacco products through any direct or indirect means, including print, television, outdoor advertising and internet communications. However, there are minor allowances for point-of-sale advertising: retailers may indicate tobacco product availability and pricing by means of signs at the point of sale, although there are restrictions on the size and location of these promotional materials.
The legislation is currently under review and the new Tobacco Products and Electronic Delivery Systems Bill is under consideration. Producers of tobbaco products should be aware that further restrictions may come into force if the bill passes through Parliament. These include:
- the introduction of plain packaging;
- a total ban on the display of products at the point of sale; and
- the introduction of 100% smoke-free areas in indoor and outdoor areas.
(d) E-cigarettes
Currently, there is no statutory regulation of the advertising of e-cigarettes and other electronic delivery systems of nicotine – hence the need for regulatory amendments, as set out above. The advertising of these products is thus not prohibited by law.
In 2023, an appendix was added to the ARB Code of Advertising Practice to introduce guidelines for the advertising of vapour products. The general principles of the code that prohibit false and misleading advertising apply, but there are also specific provisions for the promotion of such products. These include the following:
- No vapour products may be advertised to people under the age of 18;
- Advertising may not feature any persons under or appearing to be under the age of 25;
- Advertising may not be placed within 100 metres of an educational, cultural and/or sports location where the attendees are predominantly under the age of 18;
- Advertising must not use the phrase ‘safer than’ when juxtaposed against combustible tobacco;
- Generally, the advertising should not be placed unless at least 85% or more of its intended audience are people over the age of 18 years; and
- Advertising must not suggest that the use of vaping products is directly or indirectly associated with social prominence, distinction, success or sexual desirability.
Vaping products that contain nicotine should further be marked with a warning stating “This product contains nicotine and is addictive” or a warning with the same meaning.
(e) Pharmaceuticals (prescription and over-the-counter)
The advertising of pharmaceutical products is regulated both by statute and by self-regulation.
The Medicines and Related Substances Act 1965 established the South African Health Products Regulatory Authority (SAHPRA) which is responsible for the evaluation, regulation and registration of:
- medicines;
- scheduled substances;
- clinical trials; and
- medical devices.
Products that require registration with SAHPRA are categorised into different schedules, which indicate whether the products are available over the counter or on prescription only. An unregistered product may not be advertised in South Africa and there are restrictions on the advertising of medicines in general.
The Code of Marketing Practice issued by the Marketing Code Authority (MCA), in conjunction with the Medicines and Related Substances Act, governs the marketing of medicinal products to consumers.
Medicines that contain a Schedule 0 substance are available over the counter – a good example is aspirin. These do not require a prescription and may be advertised to the public.
Medicines that contain a Schedule 1 substance are also dispensed without prescription, but a patient’s details may be recorded by the pharmacy. These may also be advertised to the public.
All medicines that contain Schedule 3, 4, 5 or 6 substances require prescriptions and may not be advertised to the public. These medicines may only be advertised:
- for the information of pharmacists, medical practitioners, dentists or veterinarians; and
- only in a publication which is normally made available to these practitioners.
There are also further restrictions on statements that may be made in the advertising of medicines, where authorised – for example, no statements may be made which deviate from or conflict with the evidence submitted in the application for registration of the medicine.
The general requirements for the advertising of medicines do not deviate from other forms of advertising, in that:
- there should be no disparagement of any product of a competitor; and
- all ads:
-
- should be accurate, complete and clear; and
- should not mislead directly or by implication.
In the pharmaceutical industry, most manufacturers are aware of the limitations and restrictions on the advertising of their products and complaints regarding conflicts with the Code of Marketing Practice may be referred to the MCA, which will decide the complaint under the rules of its code.
(f) Therapeutic products (ie, products which claim to have health benefits, but which are not medicines or pharmaceuticals, such as vitamin supplements)
This is a developing area in the regulation of these products. In August 2017, the minister of health issued regulations under the Medicines and Related Substances Act to introduce the category of ‘complementary medicines’, which includes:
- aromatherapy and homeotherapy products;
- health supplements;
- vitamins;
- minerals; and
- probiotics.
The regulations introduced labelling and advertising requirements and the need to obtain a manufacturing licence from SAHPRA, since these products would now fall under the definition of a ‘medicine’ in the Medicines and Related Substances Act.
In 2020, the Alliance of Natural Health Products (South Africa) challenged SAHPRA and the minister in the High Court, declaring the regulations invalid. The alliance’s members include manufacturers and retailers of complementary medicines and health supplements. The alliance was successful and the minister and SAHPRA filed an appeal with the Supreme Court of Appeal (the SCA).
The alliance argued that the scope of the regulations exceeded the powers of the minister under the Medicines and Related Substances Act, since he is only empowered to regulate medicines and scheduled substances and complementary medicines, as defined in the regulations, do not fall within the definition of either of these categories.
The Supreme Court of Appeal considered that medicines must always have a therapeutic purpose. It held that while some complementary medicines and health supplements may qualify as medicines under the act, many do not, since:
- ‘complementary medicines’ include substances that do not have a therapeutic purpose; and
- ‘health supplements’ deviate further from ‘medicines’, as they include substances used for restoring, correcting or modifying a physical or mental state by:
-
- complementing health;
- supplementing a diet; or
- promoting a nutritional effect.
In April 2022, the Supreme Court of Appeal upheld the earlier court’s decision and declared the regulations unlawful on the basis that complementary medicines do not fall within the ambit of the Medicines and Related Substances Act. Both courts identified the need for regulation of these products, but there have been no further developments on that front.
Until such time as these products are strictly regulated, their promotion and advertising will be regulated generally under the ARB Code of Advertising Practice.
(g) Food
The regulation of the advertising of foodstuffs falls under both statute and self-regulation. The relevant statutory instruments are:
- the Foodstuffs, Cosmetics & Disinfectants Act 1972 and its Labelling and Advertising Regulations (R146); and
- the Agricultural Products Standards Act 1990 and its food product-specific regulations.
In general, all advertising is also subject to the Consumer Protection Act 2008, which prohibits any false or misleading claims in relation to goods or services.
The ARB Code of Advertising Practice is also relevant and, through its Food and Beverage Code, regulates the promotion of these products. Importantly, ‘packaging’ is defined as ‘advertising’ consistently across all the relevant regulations, at both the statutory and self-regulation levels.
All regulations are designed to prohibit false or misleading advertising or descriptions of foodstuffs, and prohibitions are in place on the use of certain words, such as ‘health’, ‘healthy’, ‘wholesome’ and ‘nutritious’. There are also specific provisions relating to:
- mandatory labelling requirements; and
- the application of nutrition information tables to packaging.
Among other things, presentations in advertising for food products should accurately represent the material characteristics of the product. All claims about nutrition and health benefits should be substantiated and advertisers must hold this substantiation prior to placing the advertising.
In terms of the Food and Beverage Code, advertisers promoting food that does not represent healthy dietary choices and a healthy lifestyle must not use celebrities or licensed characters from third parties, such as cartoon characters, in television commercials targeted at children 12 years old and under. This is not enforced at the statutory level, although R146 is currently under review with drastic amendments being proposed.
(h) Financial products and services
Under the ARB Code of Advertising Practice, all financial advertising to the public for capital or financial products or services or general financial information should, in addition to adhering firmly to the other provisions of the code, take special care to ensure that the public are fully aware of the nature of the commitment into which they may enter as a result of responding to the ad.
The advertiser bears a particular responsibility to ensure that ads do not take advantage – wittingly or otherwise – of the lack of experience or knowledge or credulity of those to whose attention the advertising is likely to come.
On the statutory front, the Financial Services Authority (FSCA) has introduced new regulations in respect of advertising by financial services providers and banks. These are contained in two statutes:
- the Financial Advisory and Intermediary Services Act 2002; and
- the Financial Sector Regulation Act 2017.
One of the main aims of the FSCA is to ensure the fair treatment of all customers.
General regulations against fraudulent, untrue or misleading statements and requirements regarding disclosures depending on the type of data being advertised have always applied.
Banks are guided in terms of advertising and marketing principles and standards which are set out in the Code of Banking Practice published by the Banking Association of South Africa. These simply require that advertising and promotional materials be:
- clear;
- fair;
- reasonable; and
- not misleading.
There is a view that these are not onerous enough.
The amendments provide, among other things, as follows:
- There are stricter procedures for approving and publishing ads.
- Records of ads must be kept for at least five years.
- When creating ads, advertisers must consider the conclusion likely to be made or understood by the client.
- Ads must:
-
- be factually correct and balanced; and
- not include misleading or obscure information.
- Ads must use plain language.
- Ad descriptions must include disclosures such as:
-
- key limitations;
- exclusions;
- risks;
- charges; and
- fees.
(a) Competitors
The Advertising Regulatory Board (ARB) Code of Advertising Practice comprises 19 clauses of compliance that are required for all advertising in South Africa to be considered legal, honest, decent and truthful. These include the following:
- Advertising may not be offensive, discriminatory or generally unacceptable.
- All ads must be truthful, which also covers substantiation of objectively verifiable claims.
- No advertising may be disparaging.
- Comparative advertising is not allowed unless it complies with certain provisions in the Code of Advertising Practice.
- There must be no exploitation of advertising goodwill and no imitation of existing ads.
Furthermore, there are grounds to object to advertising:
- that exploits the privacy of individuals; or
- in which children are exploited or portrayed in a provocative manner.
Competitors are most likely to file complaints on the grounds that a competitor is:
- engaging in comparative advertising; or
- imitating their advertising and exploiting their goodwill in its own advertising.
This is particularly relevant in the sphere of packaging.
(b) Consumer associations
The South African National Consumer Union is an independent and free resource for consumers. Its main aim is to educate and advise consumers on their rights. It is a voluntary non-governmental organisation and a non-profit organisation that represents consumers and provides guidance with the filing of consumer complaints. It assists consumers in filing disputes with several regulatory bodies, such as:
- the Consumer Goods and Services Ombud;
- the Independent Communications Authority of South Africa, in relation to mobile phone and internet service issues;
- the Motor Industry Ombud, in relation to automotive and related industry issues;
- the South African Vehicle Rental and Leasing Association, in relation to vehicle rental and leasing;
- the National Financial Ombud Scheme, which provides an alternative dispute resolution framework looking at all banking services and credit providers, including insurance services;
- the National Credit Regulator, for all disputes regarding:
-
- credit agreements;
- debt counselling; and
- credit bureaus;
- the Ombudsman for Financial Services, for all:
-
- financial and investment advisers;
- insurance brokers; and
- crypto brokers;
- the Pension Funds Adjudicator, which will assist with all pension, retirement and provident fund issues;
- the Tax Ombud, for tax enquiries – but then only after all internal complaints processes of the South African Revenue Services have failed to achieve a result;
- the Property Practitioners Regulatory Authority, for any estate agent, property management or rental body issues;
- Community Schemes Ombud Services, which will deal with the conduct of parties within community schemes, including:
-
- sectional title;
- share block;
- retirement complexes; and
- housing cooperatives;
- the Council for Medical Schemes, for all medical aid and scheme issues;
- the Health Professions Council of South Africa, which regulates all medical practitioners;
- the National Home Builders Registration Council, for all domestic building issues;
- the Legal Practice Council, for complaints relating to a legal practitioner’s services;
- the Public Protector, for any maladministration by the state; and
- the National Consumer Commission, for:
-
- any matters that are not addressed by any of the above entities; and
- all complaints under the Consumer Protection Act.
(c) Members of the public
Any consumer who wishes to complain against advertising that does not comply with the ARB Code of Advertising Practice may file a complaint, free of charge, with the ARB.
Where there is non-compliance with statutory regulations – for example, under the Foodstuffs Act – competitors may file complaints with the relevant government department, which will:
- investigate the non-compliance; and
- if there is merit in the complaint, issue a compliance directive.
Other government departments which deal with complaints include:
- the Department of Agriculture, Land Reform and Rural Development; and
- the Information Regulator created under the Promotion to Access to Information Act and the Protection of Personal Information Act.
These departments take complaints seriously and will investigate accordingly.
One of the disadvantages to taking these routes is that there may be delays in getting a result. However, statutory non-compliance carries a criminal liability penalty and, therefore, complaints are treated seriously.
Competitor and consumer complaints filed with the ARB are swiftly dealt with. However, the rulings of the ARB are binding only on its members, so a non-member that either does not respond to a complaint or fails to adhere to a ruling cannot be forced to comply with that ruling.
Under statute, any consumers may lodge complaints about contraventions of the Consumer Protection Act with the National Consumer Commission, which will issue compliance notices or refer matters to its tribunal or to other bodies such as the Competition Commission or the National Prosecuting Authority where it suspects that an offence has been committed. Regrettably, the commission is not particularly active.
Appropriate cases that deal with breaches of statute such as the Trade Marks Act, the Copyright Act or the common law may be heard by the High Court with jurisdiction over the matter.
Complaints to the ARB have a short turnaround time of a few weeks before a ruling is issued. There are several levels to ARB complaints, which are determined by the steps taken. Generally, all complaints are first considered by the ARB Directorate. If an appeal to that decision is filed, it transfers to the Advertising Appeals Committee and a further appeal is available to the Final Appeal Committee.
Complaints to government departments may take a few months and the onus is on the complainant to drive the process.
High Court proceedings are not generally quickly resolved, and one can expect it to take at least one to two years before a matter is finalised. While urgent applications will be heard by the courts, in general, commercial matters are not regarded as urgent.
Consumer complaints before the ARB are free. Competitor complaints carry an administrative charge and each level of appeal carries a charge. Advertisers seeking to use counsel for these matters must also pay the relevant fees. Outside legal counsel cannot represent parties at ARB hearings, except at the Final Appeal Committee stage.
There is no charge for filing a complaint with any of the relevant government departments, unless private legal counsel is engaged in order to prepare and lodge the complaint.
The costs of High Court proceedings will depend on the level of counsel briefed for the matter.
Where substantiation is sought, an advertiser required to produce relevant substantiation will be relieved of any further enquiry.
The defences raised will depend on which body is considering the complaint. If the matter is before the ARB and the advertiser is represented by counsel, they will put forward arguments to counter the complaint which may include, in relation to an offensive ad, for example, that South Africa functions as an open and democratic society in which particular sensitivities are not given prominence over other general rights.
The ARB may impose the following sanctions:
- withdrawal of an ad in its current format;
- submission of a proposed amendment to the ad, the original ad and the relevant ARB ruling to the Association for Communication and Advertising’s Advisory Service for pre-publication advice;
- submission of all future advertising to the ACA Advisory Service, at the advertiser’s cost, prior to publication thereof (this sanction is usually imposed only if more than one adverse ruling has been made against the respondent in a period of 12 months and normally applies for a period of six months);
- adverse publicity, including publication of the names of defaulters;
- publication of a summarised version of the ruling as proposed by the ARB, in all or some of the media in which the advertising complained of appeared or media considered appropriate by the ARB, at the respondent’s expense; and
- where a person against whom a ruling has been made fails to adhere to the ruling, any of the sanctions mentioned above, either in addition to or as a substitute for any sanction previously imposed on such person.
Any non-compliance with statute will incur criminal sanctions and successful complaints filed with the relevant government departments may result in the department issuing a compliance notice to the advertiser. In the absence of compliance, the complainant may also consider pursuing criminal prosecution.
If the issue is ventilated before the High Court, it may:
- order an interdict (injunction) to restrain the conduct in question;
- award damages and/or delivery up of the infringing materials upon which the claims appear; and
- issue any other order that the judge may deem to be fair in an open and democratic society.
Yes, before the ARB, there are two levels of appeal: first from the ARB Directorate to the Advertising Appeals Committee and thereafter a final appeal to the Final Appeal Committee. There are timeframes that apply for the lodging of each of these proceedings.
Government department rulings on non-compliance with regulations may also be appealed to give the advertiser time to change its packaging or advertising message.
A negative High Court ruling may be appealed to either:
- the full bench of the High Court; or
- the Supreme Court of Appeal.
Thereafter, there is only one further level of appeal and that lies to the Constitutional Court.
Government focus on regulations aimed at preventing deceptive advertising has definitely increased. For example, the Draft Regulations on Food Labelling and Advertising published in April 2023 propose significant changes, especially for the labelling of pre-packaged food items.
Among other things, the potential impacts include the introduction of mandatory warning labels on foodstuffs containing added saturated fat, sugar and sodium above a certain threshold, known as ‘front of pack labelling’ (FOPL). The FOPL must be placed on the front/main panel of the package – specifically in the top right-hand corner – and the size can cover up to 25% of the front of the package, depending on the number of symbols required.
Packages with FOPL cannot feature:
- celebrities;
- sports stars;
- cartoon characters;
- puppets; or
- computer animations.
This aims to reduce the appeal of such products to children and potentially discourage unhealthy eating habits which are allegedly influenced by these marketing tactics.
Businesses may incur costs related to:
- updating packaging;
- redesigning labels; and
- ensuring compliance with the new regulations.
As these are draft regulations, they are not yet in force, but advertisers are urged to stay informed about their progress and prepare for potential changes by reviewing their products’ formulations and packaging.
Challenges to the proposed new regulations have been filed with the Department of Health and news is awaited on developments with the progress of the bill.
Similarly, there is an increased focus on the strict enforcement of existing regulations. For example, the plant-based food industry recently experienced disruption in South Africa when the Department of Agriculture took it to task for using descriptive terms such as ‘burger’, ‘nugget’ and ‘sausage’ in relation to meat analogue products (ie, foodstuffs that approximate the texture, flavour and appearance of a type of meat). The department and the meat industry claimed that the use of these terms was misleading to consumers and moved to seize plant-based meat alternatives which used these terms. That decision was subsequently overturned by the Johannesburg division of the High Court, but discussions about best labelling practices for these products are ongoing. We anticipate that there may be regulatory developments in relation to these goods.
The Tobacco Products Control Act of 1993 is also under the spotlight and, because it does not cover non-traditional tobacco products, an amendment has been tabled to cover nicotine delivery systems. The draft Tobacco Products and Electronic Delivery Systems Bill of 2022:
- proposes amendments to the act to deal specifically with changes in the industry that relate to vaping devices and other nicotine delivery systems; and
- seeks to introduce plain packaging.
Challenges have been filed against the bill, particularly as the deprivation of trademark rights is inevitable with the advent of plain packaging.
Every jurisdiction has its own sensitivities, and South Africa has a very diverse culture with sometimes conflicting cultural norms which overlap with issues of race, gender and religion. There are also 12 official languages in South Africa and because of the country’s history of racial segregation and the longstanding effects of apartheid, issues of racial discrimination are of significant importance. This means that we live in a complex advertising world and advertisers are advised to seek local counsel on cultural and language concerns prior to advertising.
Most complaints that are considered by the authorities relate to packaging non-compliance, particularly for foodstuffs. It is critical for advertisers and manufacturers of food products to familiarise themselves with the labelling and advertising regulations applicable to foodstuffs. With the new law on the horizon, producers of foodstuffs need to be up to date with developments on that front.
