News

New Advertising Act

28. January, 2009

New Advertising Act has entered into force from 1st of November 2008. The main reason for drafting the new Act was the current situation in the advertising market – the legal regulation of the Advertising Act passed in 1997 needed to be modernized. In order to simplify the work of the persons who commission, perform and advertise, as well as the supervisory bodies, a substantial part of the regulation in the specific Acts regarding advertising has been assembled in the new Advertising Act.
However, in order to secure legal clarity, advertising regulation closely related to general regulation has been retained
in the specific Acts (securities market, investment funds). The new Act also provides improved requirements for advertising, restrictions regarding advertising of certain goods(tobacco and alcohol products) and services (lawyers, sworn translators, bailiffs, patent agents), as well as surveillance and liability for violation of legal requirements. The new Advertising Act has been drafted on the basis of EU legislation and the principle of free movement of goods. Any prohibition or restriction regarding cross-boarder advertising in Estonia must be in proportion with the achievable objective, foreign manufacturers and service providers must not be discriminated.

EXEMPTIONS PROVIDED FOR ADVERTISING OF TOBACCO PRODUCTS

The general prohibition of advertising of tobacco products, dating back to 1998, has been specified in the new Act. The new regulation permits the use of a trademark of a tobacco product when advertising other products, provided that the trademark is also being used to mark those goods or services. Such advertisements, however, must not depict nor refer expressly to tobacco products or the consumption of tobacco products. Although the general exemption to the prohibition permits the use of the name and the trademark of the sponsor, as well as the use of information regarding material support provided by the sponsor, without such presentation of information being deemed as advertising, the exemption does not apply to tobacco products. The same applies to the use of a trademark of a tobacco product at the place of economic and professional activities of a person. Under the new regulation, the general prohibition of advertising of tobacco products does not extend to advertising in professional publications principally intended for handlers of tobacco products (including publications printed and published outside the European Economic Area, unless such publications are intended for the EU internal market) and to information regarding sale and sales offers addressed to handlers of tobacco products. Tobacco products may be introduced at fairs, exhibitions and other similar events intended for handlers of tobacco products.

ADDITIONAL RESTRICTIONS FOR ADVERTISING OF ALCOHOL

Extensive consumption of alcohol and advertising of alcohol have evoked severe controversy and problems in the society. The regulation regarding the advertising of alcohol has been coordinated, requirements have been specified and additional restrictions have been enacted. The new Act does not distinguish between low-alcohol and strong alcoholic beverages, instead the new Act specifies the differences of advertising regarding alcoholic beverage with low ethanol content. The new Advertising Act restricts advertising alcohol products through broadcasting or other communication channels. It is prohibited to advertise alcohol products through broadcasting from 7.00 AM to 9.00 PM. The front page and the backside of a newspaper or a magazine are not to be used for advertising of alcoholic beverages. In addition, the new advertising Act requires that an advertisement of alcohol product must include a clear, detectable and distinguishable warning. The Act also provides a new prohibition regarding the content of advertisement of alcohol products, under which an alcohol advertisement must not contain information about receiving goods or services for free or for low charge by buying alcohol products. The new legal regulation of advertising takes into account the affect of advertising of alcohol to minors. In order to prevent popularisation of alcohol, the use of well-known people in alcohol advertisements is prohibited, especially if the viewers cannot link such persons to the character portrayed in the advertisement. Handling out objects related to alcohol to children for free is deemed as prohibited advertising. Various places, institutions and data media have been listed where advertising alcohol products is prohibited, including children’s events and the premises of National Defence League. Although, as a such as events held at educational institutions after school hours intended for adults, it is permitted to sell alcoholic beverages.

ADDITIONAL POSSIBILITIES FOR ADVERTISING OF GAMBLING

The legal regulation of advertising of gambling has been specified and supplemented with exemptions. Under the current Act, advertising of gambling is allowed only at the place of organisation of gambling. The new regulation provides additional possibilities for advertising of gambling, mainly with the intention to inform foreign tourists of gambling locations. Such ways of informing include advertising on board of aircrafts and ships as well as at airports and ports providing international transportation services. The prohibition of advertising of gambling does not extend to gambling locations at hotels, webpages of organisers of gambling and place of sports events where bets are made based on the totalizator. Trademark of gambling may be exhibited outside of the abovementioned sites, inasmuch as gambling, gambling location or winning chances are not depicted or referred to expressly on the trademark. It is prohibited in advertisements to present gambling as beneficial in the public interest or imply that gambling enhances social status. Gambling advertisements must not call for participating in gambling or visiting gambling locations.

SPECIFICATION OF REQUIREMENTS FOR ADVERTISING OF FINANCIAL SERVICES

Issues concerning providing financial services have become common in the society. Advertising of SMS loans has caused much controversy and public debate. Therefore, advertising of financial services was in need of specification and additional restrictions. Advertisement of a financial service must call for examination of the terms and conditions of the service. In case of advertising of consumer credit and advertisements containing data on interest rate or other credit expenses, the annual percentage rate of charge must be noted. The annual percentage rate of charge must also be marked when advertising consumer loans with the maximum sum of 10 000 kroons or with the maximum term of loan/repayment being six months. Requirements for advertising goods and services, which are likely to cause controversy in the society, have been specified. Additional restrictions have been provided for advertising of alcohol products and financial services, while exemptions have been added to the advertising regulation of tobacco products and gambling. The efficiency of surveillance has been improved and additional measures have been taken. Consistency with the EU law is important in order to avoid discrimination of foreign manufacturers and service providers. Drafting a new act was expedient, whereas extensive amendments were to be made to the current legal regulation of advertising.