When we talk about advertising we are not only talking about creating posts on social media or broadcasting spots on the radio; there is a whole market of sellers and buyers of advertising services in all the existing media which are competing like any other business and, since there is such competition, the Law of Publicity requires to be involved, participating as a mediator, prohibiting certain practices that only benefit a few or generate loopholes exploited for the interests of certain groups.
Responding to this need, this June 3rd, 2021, the Senate of the Republic approved the opinion issued by the Law for Transparency, Prevention and Combat of Improper Practices in Advertising Hiring, a new legislation that aims to promote the transparency in the advertising market, faighting certain commercial practices that generate unfair competition. But what do we mean by ‘unfair practices’?
Unfair competition is the one which carries out certain practices that favor a few, leaving its competitors at a disadvantage or taking advantage of those who hire its services.
In advertising services, it can be the resale of spaces for advertisment, double charging for some services, asking for extra commissions for the service provided, among other similar practices.
In its 13 articles, this Law of Publicity indicates each of the obligations and prohibitions that agencies and media that offer advertising services will have. These are some of them:
All this information must be clearly presented in all contracts, agreements or procedures signed between the providers and their buyers, so each party involved will know from the beginning all the information they need to know to make a conscious decision about the services that are being hired.
In the same way, it also includes a series of regulations so that the agencies, media and other parts involved have the obligation to inform the advertiser and the authorities of the financial relationships they have with the media that are contracted.
Finally, on its tenth article, it indicates the sanctions that will be applied in case of infractions:
In this way, these regulations of the Law of Publicity translate into an immediate and transparent action taken with the authority and with its buyers, since all the parties involved would be aware of the real costs of the service that has been contracted as well as all the names of those involved in the process: media, mediator or agency, final buyer and authority.
If your advertising agency needs to be advised to comply with these new regulations that will come into effect on September 1st of this year, contact us and get advice from our specialist lawyers.
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SOURCES:
Boletín del Senado de la República
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