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 in Malta is subject to a comprehensive framework of laws and regulations. Within this context, the primary sources of legislation are:

• the Consumer Affairs Act (Chapter 378 of the Laws of Malta); and
• the Broadcasting Act (Chapter 350 of the Laws of Malta).

While the Consumer Affairs Act is relevant to all forms of advertising, the Broadcasting Act (Chapter 350 of the Laws of Malta) applies specifically within the broadcasting and media sectors.

The applicability of these primary laws depends on various factors, including:

• the subject matter of the ad;
• the advertising platform; and
• the audience.

Consequently, a multitude of other laws may apply – either individually or in parallel – contingent upon the particularities of the case at hand. This multi-faceted approach underscores the commitment of the Maltese authorities to maintaining a fair, transparent and consumer-centric advertising environment.

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

Malta is an EU member state and has implemented various EU directives and regulations related to advertising, as follows:

• Audiovisual Media Services Directive: This governs the EU-wide coordination of national legislation on audiovisual media, setting out rules on product placement, television advertising and more.
• Unfair Commercial Practices Directive (UCPD): This is the overarching EU directive regulating unfair commercial practices in the context of business-to-consumer relationships.
• Consumer Rights Directive: The Consumer Rights Directive provides consumers with harmonised consumer rights across the European Union, including in Malta. Consumers have the right to be well informed prior to the purchase of goods, services and digital content.
• E-commerce Directive: Covering various aspects of e-commerce, this directive also addresses online advertising such as unsolicited commercial communications and the information available before the placing of an order.
• General Data Protection Regulation (GDPR): The GDPR imposes numerous obligations on data controllers and processors, which must process data in accordance with the principles of the regulation. Advertisers must comply with the GDPR requirements when processing personal data, especially in relation to targeted advertising.
• Tobacco Advertising Directive: This directive regulates the advertising of tobacco products in media other than television – that is:
• • the press and other printed publications;
  • radio broadcasting; and
  • information society services.
• The Food Information Regulation: This regulation includes rules on the labelling and advertising of food products, including nutritional information and health claims, including in the context of advertising.
• Geo-Blocking Regulation: This addresses the problem of customers being unable to buy goods and services from traders located in a different EU member state for reasons related to:
• • nationality;
  • place of residence; or
  • place of establishment.

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

Advertising is subject to various codes and guidelines that help to regulate the industry and ensure responsible advertising practices, as follows:

• Code of Good Practice for Private Employment Agencies Operating in Malta: This code – established by the Malta Chamber of Commerce, Enterprise and Industry – relates to employment services. Employment agencies must act transparently.
• Guidelines on Customer Information and Marketing Material for Undertakings Providing Publicly Available Telephone Services at Fixed Locations: These guidelines – established by the Malta Communications Authority – apply to service providers engaged in providing publicly available telephone services at fixed locations. They are designed primarily as a guide to service providers with regard to any self-regulatory measures that may be taken in relation to advertising content.
• Commercial Communications Committee Guidelines: These guidelines – established by the Malta Gaming Authority – provide practical guidance in relation to operators within gaming to ensure player protection. These guidelines have since been enacted in the Gaming Commercial Communications Regulations (SL 583.09).
• Unfair Business to Consumer Commercial Practices Guidelines: These guidelines – established by the European Consumer Centre Malta – provide direction on the application and interpretation of the UCPD.

In addition to general advertising guidelines, certain sectors – such as medicine, financial services and even certain professions – have their own industry guidelines that often refer to best practices in relation to advertising within the context of that industry.

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

In Malta, breaches of advertising laws and regulations are enforced by the relevant authorities depending on the applicable legislation. In relation to the primary laws, violations falling within the scope of the Broadcasting Act are enforced through the Broadcasting Authority, which monitors and regulates all radio and television broadcasts originating from Malta.

Violations of the Consumer Affairs Act are overseen by the Malta Competition and Consumer Affairs Authority's Enforcement Directorate. This body investigates:

• unfair practices;
• price transparency; and
• breaches of consumer legislation.

Claims in this regard are normally brought to light by consumers.

There may be other breaches that fall under the purview of different authorities which have their own approach, such as the Medicines Authority.

2 Authorisation and clearance

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

There are no specific requirements for advertisers to hold a licence or authorisation in order to operate in Malta. Any licensing requirements may, however, be dependent on:

• the medium used; and
• the content involved.

The Broadcasting Authority regulates all broadcasting content on radio and television that originates from Malta. It has also been designated as the authority in charge of broadcasting licensing in accordance with the Broadcasting Act. Within this context, only programmes broadcast by licensees and contractors of the authority in compliance with all provisions of the act are permitted to advertise. Other persons providing broadcasting services in Malta require authorisation from the authority to advertise.

The promotion of different products may necessitate authorisation from pertinent authorities – particularly in the case of gaming and financial services. However, when it comes to advertising services themselves, generally no specific licence is required solely for advertising. The primary licensing requirement typically relates to the operation of a company in Malta, depending on the structure and nature of the advertising company.

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

In Malta, there are no specific requirements for pre-clearance or pre-approval of ads prior to release to the public. However, advertising is subject to various regulations and guidelines, and advertisers are expected to ensure that their ads comply with legal and ethical standards. It is expected that all ads intended for release will comply with any and all relevant self-regulatory rules, regulations and laws, in consideration of the content, medium and target audience.

Billboard and roadside advertising is specifically regulated by the Placing of Billboards and Advertising on the Road Regulations. These require billboards and similar structures to be licensed by the relevant authority in consideration of roadside safety. In general:

• no ad may be displayed or illuminated in any place which is visible from the road; and
• no advertising vehicle may be placed on the road or in a place which is visible from the road without the necessary permits.

The advertising of certain sector-specific goods and services – such as tobacco, alcohol, foodstuffs and gaming – is also subject to restrictions and guidelines. Advertisers of these products and services are often required to hold a valid licence granted by the relevant authority; however, in turn, any advertising by such a licensed entity will not require further licensing or authorisation.

3 General advertising regime

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

In Malta, there are no specific regulations or standards dedicated solely to advertising. However, the general principles and regulations – especially those set out in the Consumer Affairs Act aimed at ensuring transparency, fairness and ethical conduct – are applicable to all marketing practices.

Where the nature of an ad is hidden, or where an ad deceives or is likely to deceive the average consumer, this may be regarded as a 'misleading action', which is strictly prohibited. As such, when advertising the extent of a trader's commitments, the motives for the commercial practice and the nature of the sales process, any statement or symbol in relation to direct or indirect sponsorship or approval of the trader or the product must be made clear to the consumer. Similarly, all endorsements must be genuine and all forms of advertising must be easily recognisable as such.

In general, advertising and any related promotional literature should always:

• be clear, unambiguous and accurate; and
• contain no false or misleading information.

Such material must always comply with the applicable consumer legislation.

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

The Consumer Affairs Act establishes guidelines for evaluating the fairness of commercial practices, including:

• in relation or with relevance to advertising in Malta; and
• even more so, in relation to consumer behaviour and perceptions.

In general, consistent with the Unfair Commercial Practices Directive (UCPD), exaggerated advertising is not prohibited if it might only deceive a very credulous, naive or cursory customer.

A commercial practice is considered to be in breach if it significantly distorts, or has the potential to distort, the economic choices of the average consumer as outlined in:

• Article 51C and 51D of the Consumer Affairs Act on misleading actions; and
• Article 51D of the Consumer Affairs Act on misleading omissions.

These provisions focus on practices that could materially distort the economic choices of the average consumer. The act also considers specific groups of consumers who may be more vulnerable due to factors such as age or infirmity.

Article 32B of the Commercial Code further prohibits traders from engaging in any form of misleading advertising. The Commercial Code directly references unfair and misleading advertising as delineated in the Consumer Affairs Act.

This balance between commercial practices and consumer protection is aimed at ensuring that advertising is transparent, informative and fair to all parties involved. Misleading advertising constitutes a breach of the law and is not permissible in Malta.

3.3 Under what circumstances must claims in ads be substantiated?

Unfair and misleading advertising is heavily regulated in the Consumer Affairs Act. Articles 51C and 51D identify several actions and omissions that are respectively considered to be misleading and in breach of the act. While there is no general need to substantiate advertising claims, should a query arise in relation to misleading commercial practices, substantiation will be required.

Furthermore – and specifically in relation to the use of reviews, testimonials and endorsements in advertising – while no dedicated legislation exists in Malta, the Consumer Affairs Act prohibits the following:

• falsely claiming endorsements from public bodies or entities;
• creating fraudulent consumer reviews or endorsements, or commissioning individuals to do so; and
• misrepresenting genuine consumer reviews or social endorsements for the purpose of promoting products.

It is also expected that reasonable and proportionate steps will have been taken to verify that any consumer reviews genuinely originate from consumers who actually used or purchased the product. As such, it is expected that all reviews, testimonials and endorsements are truthful and accurate, and may be substantiated if necessary.

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

In Malta, there is no specific legislation that addresses the use of test results in advertising. However, the Consumer Affairs Act includes provisions that prohibit misleading actions, encompassing situations in which advertising incorporates false information that could potentially mislead or divert the average consumer.

Even where information is factually correct – such as in the case of test results – it is considered misleading if features and circumstance of the ad cause or are likely to cause the average consumer to make a transactional decision that he or she would not have taken otherwise.

Within this context, specific mention is made in the Consumer Affairs Act of the presentation of information featuring the results and material features of tests or checks carried out on products. If such information – even if factually correct – is used in any way to misdirect consumers, it is strictly prohibited.

(b) Survey results

No specific legislation exists in Malta pertaining to the use of test results in advertising. While there is no direct mention of surveys in the Consumer Affairs Act, the use of such results to misdirect the average consumer, or in a way that causes or is likely to cause the average consumer to make a transactional decision that he or she would not have taken otherwise, is strictly prohibited.

(c) Testimonials

No specific legislation exists in Malta pertaining to the use of testimonials and endorsements in advertising. However, the Consumer Affairs Act prohibits the following:

• falsely claiming endorsements from public bodies or entities;
• creating fraudulent consumer reviews or endorsements, or commissioning individuals to do so; and
• misrepresenting genuine consumer reviews or social endorsements for the purpose of promoting products.

Such practices are considered misleading and unfair. All testimonials and endorsements must:

• be truthful and accurate; and
• be substantiated.

This is in line with the overarching EU UCPD, which prohibits the use of untruthful testimonials and endorsements. Such practices are regarded as 'dark patterns' and are prohibited, since they are likely to negatively influence consumer behaviour.

Malta also has specific legislation concerning testimonials and endorsements in the medical industry. Ads related to medical products must not contain any material that refers to testimonials and endorsements by:

• scientists;
• health professionals;
• celebrities;
• well-known organisations; or
• persons who, because of their profession or celebrity status, could encourage the consumption of medicinal products.

Moreover, the legislation and ethical regulations applicable to all medical professionals in Malta generally prohibit them from providing testimonials and endorsements in advertising.

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

Advertising to children and young people is addressed in most regulations pertaining to advertising in Malta.

Article 16K of the Broadcasting Act governs the protection of minors and provides that audiovisual commercial communications that would cause physical, mental or moral detriment to minors in any manner are prohibited. Article 16JA further provides that any such forms of advertising that may cause harm to minors as outlined above must be made available to the public in a way that ensures that minors will not normally hear or see them. These sections transpose the obligations of the EU Audiovisual Media Services Directive into Maltese law.

A subsidiary statute, the Broadcasting Code for the Protection of Minors (SL 350.05), elaborates on this issue. It sets out a vast array of restrictions which are specifically intended to protect minors from the effects and influences of advertising, thus minimising the exposure and impact that it may have on minors.

The Consumer Affairs Act also prohibits ads that encourage children to:

• buy the advertised products; or
• persuade their parents or other adults to buy the advertised products for them.

Sector-specific regulations – particularly in the context of laws governing the promotion of alcohol, tobacco and gaming products:

• include explicit prohibitions on advertising that is targeted towards minors; and/or
• impose restrictions with the aim of minimising minors' exposure to such advertising.

Advertisers operating in these sectors must rigorously adhere to these regulations, which prioritise the protection of minors from potentially harmful or inappropriate advertising materials.

3.6 Are certain forms of advertising prohibited in your jurisdiction?

The advertising market in Malta is liberal and most forms of advertising are allowed. However, certain restrictions and prohibitions exist in relation to the subject matter being advertised. The products in relation to which certain forms of advertising are restricted or prohibited in Malta include the following:

• Tobacco: The advertising of tobacco and all related products is heavily regulated and restricted. Overall, it is prohibited to advertise tobacco products in Malta and permissible advertising – allowed solely for the purpose of product purchase – must include certain health warnings.
• Alcohol: While permissible:
• • such ads should not promote excessive or irresponsible drinking; and
  • certain restrictions apply in relation to where and when such advertising may take place.
• Gaming: The advertising of gaming services is regulated. Restrictions apply to the content and placement of gambling ads. Exceptions are considered in relation to sporting events.
• Medical products and services: The advertising of medical products and is subject to strict regulation to ensure that it complies with medical and safety standards. These regulations require that all medical product advertising:
• • promote rational use of the product, includes legally required particulars; and
  • avoid misleading claims.
• Copyright: Advertisers must be wary of copyright laws – for instance, when using graffiti in their ads.

Guerrilla marketing has been gaining traction recently, raising questions relating to its standing within the advertising legal framework. As such, this aggressive marketing technique is subject to the general tests of Maltese advertising law, but there is no general prohibition thereof.

4 Misleading advertising

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

Articles 51C and 51D of the Consumer Affairs Act identify several actions and omissions which are considered to be misleading.

Misleading actions include, among other things, the provision of false information that may mislead or misdirect the average consumer. Even where information is factually correct, if the features and circumstances of the ad cause or are likely to cause the average consumer to make a transactional decision that he or she would not have taken otherwise, the ad will be regarded as misleading.

Misleading omissions involve the omission of material information that the average consumer may need to make a decision. They include the presentation of information that is unclear, unintelligible, ambiguous or presented in an untimely manner.

The Commercial Code further prohibits traders from engaging in any form of misleading advertising, directly referring to unfair and misleading advertising as delineated within the Consumer Affairs Act.

In such cases, a report may be filed with the Malta Competition and Consumer Affairs Authority (MCCAA). Initially the claim will be referred to the MCCAA or to a registered consumer association. If no amicable agreement is reached, the complaint may be presented to the Consumer Claims Tribunal (CCT), which will decide on all pending issues.

An appeal against a decision of the CCT must be brought within 20 days of the date of the decision. If the trader refuses to comply with the CCT's decision, the necessary civil remedies will be imposed.

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

The consequences for the advertiser are heavily dependent on the circumstances and the effect on the claimant; as such, the determination of the consequences is variable. As no single statute exists in relation to advertising, the applicable enforcement jurisdiction is determined by the facts of the case and the law which is subsequently applicable.

In terms of consumers who are negatively affected, disputes with a value of up to €10,000 may be resolved through the CCT. Larger claims are heard before the civil courts, where fines can range from €470 to €47,000.

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

An appeal against a decision of the CCT must be brought within 20 days of the date of the decision by means of an application. The CCT's decision may be appealed before the court of appeal (inferior jurisdiction).

An appeal may be made only:

• in relation to:
• • any matter relating to the jurisdiction of the CCT; or
  • any question of prescription; or
• where the CCT has acted contrary to the rules of natural justice and such action has prejudiced the rights of the appellant.

If the claim in dispute exceeds €1,200, the right to appeal extends to all grounds available under the ordinary civil law and is not limited to the abovementioned grounds.

In relation to other proceedings brought before the Civil Court, an appeal may also be initiated through the submission of an application within 30 days of the date of the judgment. This timeframe cannot be extended. The opposing party must respond within 30 days of notification of the appeal. Written pleadings are considered complete upon this response. New evidence is rarely accepted on appeal, except in specific cases.

Appeals of decisions of the First Hall of the Civil Court and of the Magistrates Court in its higher jurisdiction are adjudicated by the Court of Appeal in its superior jurisdiction.

Again, as no single statute exists in relation to advertising, the applicable jurisdiction will be determined by the facts of the case and the law that is subsequently applicable.

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

Article 32A of the Commercial Code prohibits traders from engaging in comparative advertising practices. However, the code goes on to set out exceptional circumstances in which comparative advertising is permissible.

Accordingly, comparative advertising is permissible where like products or services are compared with like. Such comparisons:

• must be objective and not misleading;
• must not discredit or denigrate the brand of a competitor; and
• must not to free-ride on the reputation of another mark.

Therefore, while comparative advertising is permissible in some situations, the legal regime is very restrictive and wary of advertisers that seek to mislead consumers.

Indeed, under the Consumer Affairs Act, comparative advertising is restricted if it gives rise or may give rise to a misleading action under Article 51C. Such comparative advertising may be regarded as a misleading practice if, taking account of the factual context and all features and circumstances, it:

• creates confusion with the products, trademarks, trade names or other distinguishing marks of a competitor; and
• as such, causes or is likely to cause the average consumer to take a transactional decision that he or she would not have taken otherwise.

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

Competitions of this nature fall under the purview of the Gaming Act (Chapter 583 of the Laws of Malta). Such promotional marketing is primarily regulated based on the element of risk involved. Within this context, 'games of chance' normally require a licence, but free prize draws are exempt from this requirement. The exemption hinges on the principle that games of chance – which neither involve a stake for participation nor anticipate the possibility of a prize – are exempt.

Any gaming service or critical gaming supply associated with an exempt game does not require a licence or additional authorisation. The Malta Gaming Authority (MGA) has issued the De Minimis Games Directive (3/2019), setting out the conditions that exempt games from the licensing requirement. Beyond these exemptions, the MGA encourages individuals to consult with them directly, as the final determination of a responsible gaming campaign rests solely within their discretion.

A subsidiary statute, the Requirements as to Standards and Practice, Award of Prizes and Conduct of Competitions (SL 350.22), sets out the general conduct required for competitions held through the broadcast media. Among other things:

• competitions should be conducted fairly and according to established competition rules which are known to participants; and
• prizes must be described accurately.

The Consumer Affairs Act directly addresses competitions and/or prize promotions in relation to misleading commercial practices. In this regard, traders are not permitted to conduct competitions or prize promotions without awarding the prizes described or a reasonable equivalent. This would be regarded as an aggressive marketing practice.

(c) Interest-based advertising (ie, tailored advertising based on data collected from internet browsing)

In Malta, the regulation of internet advertising primarily falls under consumer protection laws. One of the key issues to consider in online advertising is data collection – particularly for purposes such as targeted marketing. The use of electronic communications for direct marketing in Malta is subject to the Processing of Personal Data (Electronic Communications Sector) Regulations (SL 586.01), promulgated under the Data Protection Act (Chapter 586 of the Laws of Malta).

When it comes to instruments such as tracking cookies used for targeted advertising, Regulation 5 of the Processing of Personal Data (Electronic Communications Sector) Regulations is particularly relevant. This regulation is aligned with the EU E-privacy Directive (2002/58/EC), which concerns the processing of personal data in electronic communications. It addresses the installation of cookies on users' devices and outlines the conditions under which this is lawful.

According to Regulation 5, the installation of cookies on users' devices is considered lawful when the prior informed consent of the user is obtained. This means that stakeholders such as advertisers and website operators must implement mechanisms to seek and obtain user consent for the use of cookies.

Consent must be the result of an affirmative action by the user. This can be expressed through a clear and unambiguous indication of the user's willingness to accept cookies. Users must be informed specifically about the purpose and nature of the cookies, to ensure that their consent is informed. Consent should be easily withdrawable. Users should have the option to change their preferences or revoke consent at any time.

(d) Native advertising

Native advertising is subject to certain regulations to ensure transparency and prevent misleading practices. Native advertising must:

• be clearly identified as advertising; and
• be distinguished from editorial or non-promotional content.

It should be evident to the audience that they are engaging with sponsored content. These obligations also flow from the EU Audiovisual Media Services Directive, which states that television advertising must be readily recognisable from editorial content.

Clear labelling or design elements that differentiate native ads from regular content are essential. Any material connection between the advertiser and the content must be disclosed. If the content is sponsored or paid for, this fact must be transparently communicated to the audience.

In line with the Consumer Affairs Act, advertisers:

• should not deceive or mislead consumers; and
• should avoid creating confusion between commercial messaging and editorial content.

(e) Influencer advertising

Influencer/brand ambassador advertising is not directly regulated under Maltese law; however, depending on the advertising medium, the relevant laws will apply. Overall, advertising and promotional literature must:

• be clear, unambiguous and accurate; and
• contain no false or misleading information.

Legislative instruments regarding consumer matters are also applicable to advertising on the Internet.

In light of the provisions of the Consumer Affairs Act, influencers and/or brand ambassadors should disclose any connections with the brands or clients being endorsed. As influencers and/or brand ambassadors are also bound by relevant ad laws:

• all information presented must be truthful, accurate and transparent;
• all endorsements must be genuine; and
• all types of ads must be easily recognisable as such.

All forms of ad presented by influencers and/or brand ambassadors also:

• must comply with product and service relevant regulations:
• must not mislead the average consumer; and
• must not negatively affect minors.

When influencers engage in affiliate marketing, they may be exposed to obligations deriving from data protection regulations. If their activity is such that it merely drives traffic towards the operator, they will be deemed to be acting on behalf of the operator. However, an affiliate that provides customers to the operator must adhere to the processing obligations under the EU General Data Protection Regulation, since it has autonomy over its processing.

(f) Ambush marketing

'Ambush marketing' may be defined as the unauthorised use of marketing tactics by any person – whether natural or legal – to capitalise on the significant media exposure of an event, team or individual, often at the cost of a rival company's official affiliation. Such marketing is carried out without the necessary licensing, affiliation or sponsorship fees.

Malta has no specific legislation or regulations dedicated solely to addressing ambush marketing. However, this does not mean that such practices are permitted. Due to the inherent nature of ambush marketing, aspects of IP, trademark, competition and consumer protection laws may apply to such situations. Any marketing of a product – including comparative advertising – that creates confusion is considered a misleading action and as such is prohibited. Depending on the circumstances and the applicable law, criminal and/or civil liability may apply.

(g) Country-of-origin marketing

Country-of-origin marketing is a technique which brands use in order to benefit from the reputation of the country in which products are produced. For instance, Swiss watches have a longstanding reputation for luxury and precision. In recent years, Switzerland has defended 'Swissness' and has sought to block brands which attempt to free-ride on its reputation.

In Malta, country-of-origin marketing is primarily governed by consumer protection laws and regulations related to false advertising and unfair commercial practices. While there is no specific legislation dedicated solely to country-of-origin marketing, the existing legal frameworks provide guidelines and requirements that advertisers must observe in their advertising practices.

In terms of consumer protection, a commercial practice will be regarded as misleading if in any way, including overall presentation, even within advertising, its main characteristics – including country-of-origin information – deceive or are likely to deceive the average consumer, even if that information is factually correct.

(h) Green marketing

Misleading or false advertising is prohibited in all types of communications. While environmental or 'green' advertising claims are not specifically addressed under Maltese law, unfounded environmental or green advertising claims are likely to breach Maltese law.

Articles 51C and 51D of the Consumer Affairs Act respectively identify several commercial practices that, by way of action or omission, may be regarded as misleading. In this regard, the law takes into consideration all features and circumstances of the ad that may cause or be likely to cause the average consumer to take a transactional decision that he or she would not have taken otherwise.

As such, any claims made in relation to environmental or green advertising:

• must be accurate, truthful and clear; and
• must in no way mislead the average consumer.

Any practices regarding green and environmental advertising will also generally be regulated by the Unfair Commercial Practices Directive (UCPD), which prohibits 'dark patterns' in advertising and consumer law. Consequently, should an ad present misleading information to consumers, who as a result may or may not purchase goods due to the environmental characteristics presented, it will be deemed misleading and contrary to Article 6 of the UCPD.

In 2023, the European Union proposed a Green Claims Directive to protect consumers and empower them in the green transition. Therefore, in the coming years, it is likely that businesses which communicate environmental claims will have enhanced obligations and will be obliged to substantiate their claims.

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

Inbound telemarketing is a type of telemarketing whereby customers call a company to inquire about or purchase a product or service that they have heard about from an ad. While there are no specific regulations on inbound telemarketing, the generic rules in the Consumer Affairs Act apply. These require that the trader:

• maintain transparency and clear information; and
• avoid any misleading or aggressive commercial practices.

Outbound telemarketing falls within the scope of the Processing of Personal Data (Electronic Communications Sector) Regulations (SL 586.01). Within this context, no one may make use of a publicly available electronic communications service to make unsolicited communications for the purpose of direct marketing by means of an automatic calling machine without the prior consent of the recipient.

(b) Email marketing

The use of electronic communications for the purpose of direct marketing in Malta is regulated by the Processing of Personal Data (Electronic Communications Sector) Regulations (SL 586.01), promulgated under the Data Protection Act (Chapter 586 of the Laws of Malta). This applies to the processing of personal data in connection with the provision of publicly available electronic communications. Email marketers must provide clear and transparent information about:

• their identity;
• the purpose for which the personal data is being processed; and
• the rights of the data subjects.

No one may make use of a publicly available electronic communications service to make direct marketing unsolicited communication by means of email without the prior consent of the recipient. Consent should be:

• freely given;
• specific;
• informed; and
• unambiguous.

However, where a data controller has obtained email addresses from customers through the sale of a product or a service, it may use these details for the direct marketing of its own similar products or services.

All marketing emails must include a clear and straightforward way for recipients to opt out (unsubscribe) from further communications. This opt-out mechanism must be:

• free of charge and unambiguous; and
• provided at the time the information is initially collected, as well as in every subsequent marketing communication.

(c) Direct mailings

Direct marketing by a means of communication which is not listed in the Processing of Personal Data (Electronic Communications Sector) Regulations – such as conventional mail and cold calling involving human interaction – is permissible as long as it:

• is at no charge to the recipient; and
• gives the recipient the ability to request the cessation of such communications.

In any case, the collection and processing of data must comply with the data protection rules.

(d) Opt-out marketing

Opt-out marketing is a marketing strategy or approach through which individuals are automatically included in a marketing campaign or mailing list unless they specifically take action to request removal. While there is no specific legislation on the concept of opt-out marketing, the existing legal frameworks provide guidelines and requirements that advertisers must observe in their advertising practices, specifically in relation to the medium of marketing that is used.

However, 'dark patterns' are generally prohibited. Therefore, a data processor must ensure that the consent it has obtained:

• is unequivocal; and
• has not been obtained through some manipulative technique.

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

If advertising is conducted through product placement in a programme, the Broadcasting Act requires clear and unambiguous disclosure. This means that viewers must be informed at the beginning and end of the programme, as well as after each commercial break, about the existence of product placement within the content. When advertising the extent of a trader's commitments, the motives for the commercial practice and the nature of the sales process, any statement or symbol in relation to direct or indirect sponsorship or approval of the trader or the product must be made clear to consumers.

In terms of product placement, the Broadcasting Act specifically prohibits the placement of tobacco-related goods and medical goods and treatments that are available on prescription only. Product placement for alcohol products and gambling services is restricted and is permitted only under certain circumstances. These prohibitions and restrictions are regulated by both the Broadcasting Act and all relevant product-specific regulations.

The Audiovisual Media Services Directive sets out a general prohibition on product placement in programmes unless:

• it appears in:
• • cinematographic works;
  • films and series made for audiovisual media services;
  • sports programmes; or
  • light entertainment programmes; or
• payment is not required for the product.

These derogations must adhere to certain conditions – for example, the product placement must not:

• influence the editorial independence of the media service provider;
• be given undue prominence; or
• encourage the audience to purchase or rent the product.

Moreover, viewers must be informed of the existence of the product placement.

Surreptitious and subliminal advertising techniques are banned under the Broadcasting Act, as advertising must be readily recognisable as such.

(b) Sponsorship

The Broadcasting Act mandates that viewers must be clearly informed about the existence of any sponsorship by a commercial entity.

The act emphasises the need for transparency by ensuring that viewers are made aware of any financial or commercial involvement in the content. Programmes that have been sponsored must be distinctly identified as such. This includes the use of the sponsor's name, logo or other symbols during the programme. This identification serves to differentiate between regular content and content that has been influenced or financially supported by a sponsor. Moreover, sponsored content must be distinguishable from editorial content.

Under Maltese law, the general guiding principle for ad is transparency. Advertising must be clearly identifiable as such. Under the Broadcasting Act, advertising must likewise be immediately recognisable as such. Surreptitious and subliminal advertising techniques are prohibited.

If the nature of an ad is concealed, or if an ad deceives or is likely to deceive the average consumer, this may be considered a 'misleading action' in terms of the Consumer Act. As such, when advertising the extent of a trader's commitments, the motives for the commercial practice and the nature of the sales process, any statement or symbol in relation to direct or indirect sponsorship or approval of the trader or the product must be made clear to consumers.

(c) Loyalty programmes

Malta has no specific laws or regulations governing loyalty programmes. However, businesses that operate loyalty programmes in Malta are subject to several legal and regulatory frameworks.

Businesses must ensure compliance with:

• the data protection, consumer protection and competition laws;
• general advertising standards; and
• any other legislation relevant to the specific products being advertised.

It is crucial for businesses that operate loyalty programmes in Malta to stay up to date on new regulations and changes to existing laws that may affect their programmes.

If the loyalty programme involves the collection and processing of data, the data processor must ensure that this takes place in accordance with the principles of data processing as laid down in the General Data Protection Regulation.

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 Gaming Act (Chapter 583 of the Laws of Malta) clearly distinguishes between 'contests of skill' and 'games of chance', resulting in profoundly different regulatory frameworks that govern the various forms of gaming.

A 'game of skill' is a contest in which the abilities and expertise of the participants directly impact the outcome. However, this definition explicitly excludes sporting events, except where otherwise specified by law.

Games of skill do not require a licence, except where a stake for participation or a monetary prize or its equivalent is involved. In such instances, they are categorised as controlled games of skill and a licence is required. The entity operating or promoting the game must establish that it qualifies as a contest of skill which is exempt from the licensing requirement.

By contrast, a 'game of chance', such as a lottery, encompasses activities:

• in which chance rather than skill predominantly determines the outcome; and
• which are thus dependent on luck or random events, including future outcomes which are presently unknown.

Any gaming service or critical gaming supply associated with an exempt game does not require a licence or additional authorisation. The De Minimis Games Directive of the Malta Gaming Authority specifies the conditions under which games will be exempt.

The Requirements as to Standards and Practice applicable to the Conduct of Competitions and the Award of Prizes (SL 350.22) set out the general conduct required for competitions held through the broadcast media. Among other things:

• competitions should be conducted fairly and according to established competition rules which are known to participants; and
• prizes must be described accurately.

The Consumer Affairs Act directly addresses competitions and/or prize promotions in relation to misleading commercial practices. In this regard, traders are not permitted to:

• conduct competitions or prize promotions without awarding the prizes described or a reasonable equivalent; or
• fabricate situations in which consumers are given the false impression that they have already won or will win a prize, or will win a prize if they do a particular act, when in fact either:
• • there is no prize to be won; or
  • claiming the prize would involve the payment of money or otherwise incur a cost.

(b) Alcohol

Alcoholic products are subject to the Requirements on Advertisements, Methods of Advertising and Directions Applicable to Alcoholic Drink Advertising, Sponsorship and Teleshopping (SL 350.24). While the advertising of alcohol is allowed, it is subject to numerous restrictions, aimed primarily at protecting minors from undue influence and effects.

The regulations:

• specify the times at which alcohol advertising is permissible; and
• set forth additional measures to protect minors.

They also:

• outline the types of ads that are considered unacceptable;
• address safety-related aspects; and
• specify how humour can be used in ads so as not to undermine the regulations.

(c) Tobacco

Tobacco and all related products are specifically regulated by the Advertising and Promotion of Tobacco Products Regulations (SL 315.06). Overall, the advertising of all tobacco-related products is prohibited in Malta. Pictures of cigarettes or any such representations pertaining to tobacco products:

• are permissible on cigarette machines only for the purpose of product selection; and
• must include health warnings.

(d) E-cigarettes

E-cigarettes that contain tobacco are considered to be a tobacco-related product and as such are specifically regulated by the Advertising and Promotion of Tobacco Products Regulations (SL 315.06).

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

The advertising of medical products and services is highly regulated in Malta. Within the context of the Broadcasting Act, the Requirements as to Standards and Practice on Programmes involving the Participation of Certain Health Care Professionals in the Broadcasting Media and Requirements as to Advertisements and Directions Applicable to Medicinal Products and Treatments (SL 350.30) will apply.

Other important statutes in this regard include:

• the Medicines Act (Chapter 458 of the Laws of Malta); and
• the Medicinal Products (Advertising) Regulations (SL 458.32), which transposed EU Directive 2001/83/EC, Title VIII.

The following requirements apply to all ads for medical products:

• They must promote rational use of the product;
• The advertised products must contain a list of all particulars required by law; and
• They cannot be misleading.

Article 5(1) further provides that all medicinal products that are advertised must have received valid authorisation to be placed on the Maltese market.

The advertising of over-the-counter (OTC) medicinal products to the public is permissible in Malta. However, the advertising of prescription-only medicines or medicines that contain substances defined as psychotropic or narcotic under Maltese law to the general public is prohibited.

Additionally, advertising cannot imply that:

• the effects of the product are guarantee; or
• the product is comparatively better than other products or treatments.

It is further prohibited for an ad to include any form of endorsement or advertising targeted at minors.

Several specificities in relation to this industry exist and as such, any ad should be considered on a case-by-case basis in full consideration of:

• the specific product or treatment; and
• the targeted group.

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

The advertising to the public of OTC medicinal products is permissible in Malta; however, the advertising of prescription-only medicines or medicines that contain substances defined as psychotropic or narcotic under Maltese law towards the general public is prohibited.

The benchmark is whether the therapeutic product falls within the scope of the 'Advertising criteria' outlined within Article 5 of the Medicinal Products (Advertising) Regulations (SL 458.32) and the definition of a 'medical product' set out in Article 2 of the Medicines Act.

A 'medicinal product' is defined as:

• any substance or combination of substances for treating or preventing disease in human beings; and
• any substance or combination of substances which may be administered to human beings with a view to:
• • making a medical diagnosis; or
  • restoring, correcting or modifying physiological functions in human beings.

If a therapeutic product falls outside this definition, the medicinal advertising requirements will not apply. Instead, the general advertising legal regime will apply – in other words, the ad:

• must not be misleading; and
• must be transparent and honest.

(g) Food

The Labelling, Presentation and Advertising of Foodstuffs Regulations (SL 449.46) govern most food products sold in Malta. The regulations require clear and transparent labelling which clearly outlines the contents of all food products sold on the Maltese market. Food labelling is especially important and must include information such as:

• the product name;
• a list of ingredients;
• the quantities of specific components such as sugar and fat; and
• the best-before date.

Article 16K(6) of the Broadcasting Act provides that the broadcasting of all forms of audiovisual ads for food and beverage brands and products containing nutrients and substances which are classified as 'high in fat, sugar and salt' is prohibited immediately before, during and immediately after children's programmes.

The Healthy Lifestyle Promotion and Care of Non-communicable Diseases Act empowers the minister for health to lay down further regulations relating to the marketing of products which may have an adverse effect on healthy lifestyles.

(h) Financial products and services

Various regulations may apply in this context, depending on the specific types of services or product being offered. Of particular significance is the Malta Financial Services Authority (MFSA), which provides comprehensive guidelines for the advertising of financial products and services. These guidelines emphasise the principles of transparency and consumer protection.

Financial advertising and promotions must adhere to the following key principles:

• Fairness: Financial services providers must ensure that their advertising is fair and just in its treatment of consumers.
• Clarity: Ads should:
• • be clear and easily understandable; and
  • transparently explain the nature of the product or service, how it operates and the potential benefits it offers.
• Accuracy: It is essential that ads provide accurate information, avoiding any form of misleading content.
• Cost disclosure: Any costs associated with the product or service must be explicitly detailed so that consumers are fully informed about the financial implications.
• Risk awareness: Ads should also convey any potential risks associated with the investment or financial product, enabling consumers to make well-informed decisions about their finances.

By adhering to these principles, financial service providers will not only ensure compliance with MFSA regulations, but also foster trust and confidence among consumers. This contributes to a more transparent and secure financial landscape, to the benefit of all stakeholders. The MFSA has explained that responsibility for the content of ads lies with the financial intermediary promoting the product. The MFSA does not vet ads prior to release but it does monitor them to ensure that they comply with its regulations.

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.

In Malta, breaches of advertising laws and regulations are enforced by the relevant authorities depending on the legislation applicable to the case at hand, in consideration of:

• the offending party;
• the affected party;
• the medium; and
• the damages caused.

(a) Competitors

Competitors may take action in accordance with the Commercial Code (Chapter 13 of the Laws of Malta), which applies to traders and to all acts of trade, even by persons who are not traders. Within the context of advertising, an action for damages may arise in relation to comparative advertising if it is not carried out in a manner that is permissible.

Similar to the position under the Consumer Affairs Act, action may also be taken by competitors for misleading advertising. In this regard, any misleading advertising that injures or is likely to injure a competitor of the party whose interests the ad aims to promote may seek enforcement.

(b) Consumer associations

Rather than taking direct action themselves, consumer associations in Malta aim to educate consumers, further their interests and help them to obtain redress. Enforcement does not fall within the scope of consumer associations.

The Malta Competition and Consumer Affairs Authority (MCCAA) also helps consumers by mediating between consumers and traders in a bid to find an amicable solution to an ongoing issue prior to taking action before the Consumer Claims Tribunal (CCT). In fact, consumers are urged to contact the MCCAA prior to filing a claim before the CCT and the MCCAA will assist in attempting to reach an amicable solution between the parties involved. If this does not succeed, the injured party can institute proceedings before the CCT.

(c) Members of the public

Members of the public can challenge advertising practices through a private right of action against businesses or entities that engage in, for example, misleading advertising that harms their interests.

Again, however, this will depend on the facts of the case. Most consumer claims that do not exceed €10,000 will be brought before the CCT. Such claims arise from concerns, whether direct or indirect, relating to:

• the purchase or hire of goods by a consumer from a trader; or
• the provision of services by a trader to a consumer.

Larger claims must be heard by the Maltese courts.

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

Both competitors and consumers can access various legal avenues to address their grievances. Competitors must bring any such claims before the First Hall of the Civil Court, Commercial Section. The introduction of the Commercial Section in 2018 was prompted by the need for specialised courts dedicated to the handling of commercial matters in order to deliver higher-quality, more expedient judgments.

For consumers, the choice of legal recourse depends on the nature of the issue at hand. They may bring an action before the civil courts or the CCT. The CCT was specifically established to hear the claims of consumers who encounter problems with products or services purchased or rented from a trader. Prior to initiating a claim before the CCT, consumers are encouraged to attempt to reach an amicable resolution through the conciliation process offered by the MCCAA or a registered consumer association.

Only consumers have the right to bring their disputes with traders before the CCT. Additionally, cases initially brought before the civil courts may, by mutual agreement between the parties, be referred to the CCT for further proceedings. One significant advantage of the CCT is that legal representation is not obligatory. This accessibility empowers consumers, as they do not need to bear the burden of legal fees. Furthermore, consumers may submit claims to the CCT for moral damages stemming from pain, distress, anxiety and inconvenience suffered, making this a more inclusive and consumer-friendly platform for seeking redress.

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

This will vary according to the complexity of the case. Generally speaking, the CCT was designed to be a more expedient forum than the civil courts.

9.4 What costs are incurred?

Civil courts: The costs of civil court proceedings will vary depending on:

• the complexity of the case; and
• the claims being made. Generally speaking:
• • if the claim for damages does not exceed €5,000, the case will be filed before the Small Claims Tribunal;
  • if the claim is between €5,000 and does not exceed €15,000, the case will be filed before the Magistrates Court; and
  • if the claim is above €15,000, the case will be filed before the First Hall of the Civil Court.

Each court has its own court and judicial expenses. The most expensive is the First Hall of the Civil Court and the cheapest is the Small Claims Tribunal. The costs increase or decrease depending on factors such as:

• the number of sittings;
• the number of witnesses summoned;
• the number of experts appointed; and
• whether the decision is appealed.

The CCT is a less costly form of recourse, but again the exact fees will vary according to the value of the claim. A cost of €9.50 will be charged if the value of the claim does not exceed €580; this then rises incrementally up to a maximum of €43.50 for claims of between €8,500.01 and €10,000.

9.5 What defences are typically raised by the advertiser?

In Malta, the parties that file claims and pleas must prove their respective positions to the court. Article 562 of the Civil Code provides that: "... the burden of proving a fact shall, in all cases, rest on the party alleging it."

An advertiser may also claim that the applicant lacks juridical interest. The applicant must prove that it has an interest in the case which is direct, actual and personal. If it fails to prove this, the case will be thrown out.

The respondent may use to its advantage the fact that pecuniary damages in advertising disputes are hard to quantify. Moreover, non-pecuniary damages are seldom awarded and the courts are conservative in their approach on the rare occasions where they do award such damages. Therefore, the remedies against an advertiser which is in breach of the law are minimal for consumers and for the person in the street.

The respondent usually refutes the claims made against it and may argue that:

• the applicant has failed to refer to the specific law which it has breached; or
• the requisite conditions for such a breach have not been sufficiently satisfied.

That said, the defences raised often vary according to the circumstances, whether on a point of law or on the merits of the claim.

During the court sittings, the parties will each substantiate their positions. The plaintiff will initially attempt to prove its arguments and the defendant will then counter the claims made with its own evidence. The court will review all evidence presented and deliver its judgment accordingly.

9.6 What remedies are available?

The available remedies vary significantly depending on the circumstances, including:

• the parties involved;
• the communication medium used; and
• the applicable laws.

Where a party is found to be in violation of the applicable legislation, the penalties can include:

• fines;
• restitution for civil damages; and
• even criminal punishments, particularly in cases involving trademark abuse.

The specific course of action will depend on the unique aspects of each case.

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

The process for filing appeals in Malta can vary depending on the specific court or authority involved. The appeals procedures for different cases are as follows:

• Broadcasting Act violations: Violations that fall under the purview of the Broadcasting Act, particularly in relation to broadcasting licences and contracts, are enforced by the Broadcasting Authority. A decision of the authority can be appealed within 15 days of the date of the decision before the Court of Appeal.
• CCT: Appeals against decisions of the CCT must be submitted within 20 days of the date of the decision. The CCT is specifically designed to handle consumer claims relating to goods or services purchased from a trader. The appeal must be brought before the Court of Appeal.
• Civil courts: Further to legislative amendments introduced in 2021, the time limit to file an appeal has been extended from 20 days from the date of the judgment to 30 days from the date of the judgment. The process for filing an appeal may vary but typically involves the submission of an application to appeal to the Court of Appeal.

While the above are the general procedures, the specific requirements and steps for filing an appeal may differ for each court or authority. It is advisable to consult legal counsel or the official documentation of the relevant court for precise instructions and guidance when pursuing an appeal.

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?

The advertising industry is dynamic and can change rapidly in response to technological advancements, shifts in consumer behaviour and evolving regulations. While no major overhauls have occurred in recent years, in late 2022 several amendments were made to the Consumer Affairs Act in relation to deceptive advertising, to better adapt the legislation to modern media and scenarios. The Malta Financial Services Authority has indicated that it is increasingly clamping down on advertising which is not compliant with financial services regulations.

Article 51C of the Consumer Affairs Act was introduced in order to address misleading actions regarding the dual quality of goods – that is, where goods are marketed as identical in different EU member states when in fact they have a significantly different composition or characteristics. Changes to Article 51D regarding misleading omissions and material information resulted in the addition of paragraph (3)(f) relating to products sold on online marketplaces.

A new environmental law which would introduce new obligations to substantiate environmental claims was proposed in 2023. In response to the growing emphasis on healthier lifestyles, it is possible that the promotion of foods that are high in fat, sugar and salt will be regulated in future if there is sufficient political will to do so. A new law has also decriminalised the use of cannabis; we therefore expect a proliferation of legislation banning or regulating the advertising of the use of cannabis similar to the regimes for alcohol and tobacco. There are also concerns and ongoing developments in relation to the regulations governing political advertising in Malta.

At an international level, the debate continues on the advertising and packaging of vape products, which tend to sport colourful designs.

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?

When promoting products and services in Malta, it is crucial to align advertising with local regulations and cultural intricacies. Ensuring that ads adhere to the Maltese advertising regulations, including the Consumer Affairs Act and industry-specific guidelines, is paramount. Transparency in pricing and terms, in accordance with local laws, is also essential; and any special offers or discounts should be clearly communicated.

However, there are certain challenges to be mindful of. Navigating Maltese advertising regulations can be complex, particularly in sectors that are subject to specific rules and restrictions. In the digital age, it is imperative to keep up with evolving regulations pertaining to digital advertising, data privacy and online marketing. These regulations may influence online advertising strategies, at both the local and EU levels.

By understanding and addressing these issues, companies can conduct effective advertising campaigns in Malta while remaining compliant with legal and cultural expectations.

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.