As a prime example, the cross-party environmental audit committee "named and shamed" Mates condoms for its "ishaggedhere.com" campaign.
Outdoor advertising contractor Maiden took action when the ads were pasted across a 96-sheet poster site obscuring a Ford ad. The campaign was booked by Rocket and distributed through ambient company Diabolical Liberties.
The MPs claimed that the company used the campaign as an illegal way to boost sales.
The committee said that penalties imposed by the courts on offenders are so small -- between £75 and £2,000 -- that it is often easier to advertise illegally.
It called for heavier penalties and community service orders against offenders, as well as new rules making it less easy for companies to claim that they did not know their products were being advertised illegally.
The MPs' report also tipped music companies as the key culprits. Earlier this month, companies including MTV, BMG, Grand Central Records and Music for Nations pledged to stop sticking up thousands of flyposters each week after Westminster Council threatened to press criminal charges.
The action followed the lead of Camden borough, which last month threatened to take out Anti-Social Behaviour Orders against those responsible for flyposting. It took Sony and BMG to court, but summons were withdrawn when bosses pledged not to continue. They escaped what could have been a five-year jail sentence.
Last month, Westminster Council tried to raise awareness of the problem through the Street Bling website.
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