Last month, the European Parliament gave the green light to a wide ranging EU Directive on consumer protection and subject to ratification by the European Council, the main decision making body of the European Union, it will need to be implemented across all 25 member states by 2007.
Scope of the new EU Directive
The EU Directive lists 28 business practices now specifically defined as unlawful.
The new law will ban unfair advertising, marketing and other commercial practices used by marketers in their dealings with consumers.
In particular, sales and marketing practices that are misleading or aggressive will be banned. This includes telephone prize giving scams, pyramid selling schemes, and "bait advertising" such as low cost airlines advertising discount prices that only apply to a few seats on a certain route.
Effect of the new EU Directive?
According to the latest Office of Fair Trading statistics, about 拢1bn a year is lost by consumers due to dubious sales and marketing techniques.
The new EU Directive replaces a complex web of existing national rules and common law with a single, EU-wide regime.
This harmonisation should in theory make it easier for brand owners to market and sell to 480m consumers in the EU on the basis of one common set of rules.
The reality is that judgment calls will need be made in each EU Member State dependent on its own understanding and interpretation of the EU Directive. Further variations between member states could occur as national courts may take account of non-legal factors, such as cultural and even religious norms in deciding whether there has been an infringement of the EU Directive.
Whichever way you look at it, the new EU Directive is bound to produce a period of uncertainty for brand owners in Europe, particularly when it comes to marketing to kids.
Crackdown on pester power ads
This is perhaps the most controversial area of the new EU Directive, which bans any advertising to kids that includes "a direct exhortation to children to buy or to persuade their parents or other adults to buy advertised products for them."
北京赛车pk10s that have attracted negative comments from groups such as the Consumers' Association include: Nestle's Mud and Worms breakfast cereals that feature 'Shrek'; a range of Tayto corn snacks featuring 'The Simpsons'; and McDonald's featuring the characters from the Disney film 'The Incredibles' in its advertising.
I would agree that many characters loved by children are being used to promote foods high in fat, sugar and salt that could leave some parents powerless to say no.
But the food manufacturing industry is aware that unless it changes its practices it will face further regulation and is currently in the process of cleaning up its act.
Where to draw the line?
Dealing with a direct sales and marketing message aimed at children is one thing.
Determining that the advertising has in some unconscious or sublime way influenced a kid to protest to its parent to buy a particular product is quite another.
Where the EU Directive fails, in my view, is that it doesn't take account of the fact that kids are incredibly brand savvy at a very early age and make up their own minds on what they like and don't like, regardless of what the grown-ups think.
My three-year-old daughter Zara is a case in point. She already expresses a preference for Barbie and when we went to Florida for her birthday last year, I had to order a Barbie birthday cake. No other birthday cake would do.
Zara hasn't been exposed to a massive amount of Barbie TV advertising. Instead, like many toddlers of her age, she's beginning to assert her own identity and this includes asserting her own preferences -- from food, to clothes, to shoes and yes, even Barbie.
And she's made up her own mind about the brand.
Natural justice for marketers?
So if we know this, an EU Directive is never going to remove pester power completely.
A more extreme response would be to ban children's advertising altogether throughout the EU. I doubt that would be in the consumers' best interests and would probably fall foul of the European Convention of Human Rights (Freedom of Expression, Article 10).
The long-term and sustainable solution is for brand owners to be part of the solution and not part of the problem.
However, marketers who play by the rules could still be caught out by this new EU Directive, which would amount to a perversion of the intention of the European Parliament.
If there's enough evidence that the net has been cast too widely, then the Council of Ministers could require the legislators to think again.
Ardi Kolah is the author of Essential Law for Marketers (Butterworth Heinemann, 拢25) and is rated as one of the leading thinkers on marketing in the world by the Chartered Institute of Marketing. He takes up the post of director of communications, Imperial College London, in May 2005.
If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the .