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Written Ministerial Statement on Television Product Placement

News Release issued by the COI News Distribution Service on 09 February 2010

9 February 2010

The Secretary of State for Culture, Media and Sport (Ben Bradshaw): I would like to set out the Government’s plans for product placement on television.

I announced on 9 November 2009 that the Government had decided to consult again on this issue, and we did so between that date and 8 January this year. We had approximately 1480 responses to this consultation. I am publishing these on my Department’s website today and we will make a summary report of them available shortly.

As a result of this consultation the Government has concluded that we will be able to allow television product placement in a way which will provide meaningful commercial benefits to commercial television companies and programme makers while taking account of the legitimate concerns that have been expressed.

We have therefore decided to legislate to allow UK television companies to include product placement in programmes which they make or commission to appear in their schedules.

Adherence to our current position in which UK TV programme-making cannot benefit at all from the income potentially to be generated by product placement would lead to continuing damage to its finances at a time when this crucial part of our creative industries needs all the support we can give it.

It has become the more important to make this move now that every other EU Member State, with the sole current exception of Denmark, has either allowed television product placement already or has expressed a firm intention to do so. Not to do so would jeopardise the competitiveness of UK programme makers as against the rest of the EU, and this is something which we cannot afford to do.

UK audiences have been used to product placement in films and, subject to them not being unduly prominent, imported television programmes, especially from the United States, for many years. However, allowing television product placement in domestic UK programming will be an important departure. It is right for us to proceed with caution and in particular to be very careful about the types of product for which it is permitted.

Our legislation will therefore specify some important exceptions, in particular the prohibition of the placement of alcohol and foods and drinks high in fat, salt or sugar (HFSS foods). The Government also fully shares the concerns that have been expressed about the potential impact of product placement on the editorial independence of broadcasters and viewers’ trust in what they see on television. We believe that our proposals will safeguard these.

Legislation The Government will lay Regulations under section 2 of the European Communities Act 1972, giving legal effect to the requirements of the EU Audiovisual Media Services Directive on TV product placement. However, TV product placement will not become permissible immediately the Regulations come into effect.

Their effect will be to allow Ofcom to permit product placement under its Code regulating the content of TV programmes, and Ofcom will need to run a public consultation on the detailed changes to this Code before these can come into effect.

Only after that has happened, and Ofcom has amended its Code, will it be possible for TV companies to show programmes which they have made or commissioned and which include product placement. We envisage that this stage would be reached later this year.

The EU Directive requires that Member States prohibit product placement but permits them to derogate from that in the four separate genres of ‘cinematographic works, films and series made for television or on-demand services, sports programmes, and light entertainment programmes’. Our legislation would therefore follow this pattern of imposing an overall ban on product placement except in these four genres.

The legislation will not provide more precise definitions of these terms. Instead, it will allow Ofcom to intervene in the event that broadcasters unacceptably stretch the envelope and include product placement in programming which cannot properly be seen as falling into any of these permitted categories. The existing powers, including the code-making powers, which Ofcom have allow them to do that in an appropriate and effective way.

The responses to our consultation have confirmed that there is concern about the possibility of product placement in current affairs, consumer and religious programming. The Government shares these concerns, since some programmes in these categories could be seen as falling into the ‘series’ genre specified by the Directive, and we have concluded that it is important that our legislation ensures that product placement is not allowed in them. It will therefore contain specific prohibitions to that effect.

News programmes and bulletins are not covered by the four genres of programme which the EU Directive permits to contain product placement. Our legislation will therefore have the effect of preventing product placement in any TV news programming, as the Directive requires.

Our legislation will not permit product placement in the BBC’s licence-fee funded services. This will continue to be prevented by the BBC’s Charter and its Agreement with the Government.

Products The Directive prohibits the placement of two specific types of product, that is tobacco products (as well as any other placement by or on behalf of a company whose principal activity is the manufacture or sale of tobacco products) and prescription medicines. The Government has decided to move significantly beyond this. Our legislation will specifically prohibit the placement of products and services in the following categories

* alcoholic drinks;
* foods and drinks high in fat, salt or sugar;
* gambling;
* smoking accessories;
* over-the-counter medicines; and
* infant formula and follow-on formula.

In reaching this decision the Government has had the issue of potential effects on health and welfare, and especially children’s health and welfare, particularly in mind. The Directive contains a ban on product placement in ‘children’s programmes’, and our legislation will enact that. However, children’s viewing is not confined to children’s programmes.

An alternative to a ban on placement of HFSS foods and alcohol might have been restrictions of some kind on their placement in shows which have a large child audience, or which are shown before the watershed. But this would be complex to administer and would not provide the certainty which the Government seeks.

In the circumstances we intend to legislate for a complete bar on placing these products. This as an important aspect of the cautious approach that we need to take.

Other safeguards

Our legislation will also, as required by the Directive, specify that product placement should not affect editorial independence, be unduly prominent, or directly encourage purchase. Ofcom will have the task of policing adherence to these requirements.

Ofcom will also be able to set further conditions for ensuring editorial integrity, including in relation to the prominence of products which have been placed in a television programme. The Directive requires that audiences are alerted to the presence of product placement in a programme by ‘signalling’ at the beginning and end and after advertising breaks. The legislation will contain this requirement and it will be for Ofcom to determine, after their own consultation, how it is met.

The legislation will not affect requirements in respect of the presence of product placement in imported, non-EU, programmes which are transmitted by UK television broadcasters. This will continue to be permissible within the boundaries set by the Directive, provided that it meets Ofcom’s overall requirements about, in particular, the avoidance of undue prominence.

Contacts:

DCMS Press Enquiries and Out of hours telephone pager
Phone: 020 7211 6263
Mobile: 07699 751153
NDS.DCMS@coi.gsi.gov.uk

Sandra McKay
Phone: 020 72116267
sandra.mckay@culture.gsi.gov.uk