ASA v Ryanair – OFT, you decide!

After banning its ninth Ryanair advert in just two years, the Advertising Standards Authority (ASA) has taken the radical step of referring Europe's largest budget airline to the Office of Fair Trading (OFT). In a bizarre move, Ryanair has made a counter-referral, claiming that the ASA is biased against it. The advertising industry and its lawyers alike eagerly await indications as to the OFT's likely course of action – will it flex the significant muscle it has as its disposal? If Ryanair's antics continue, will some of its directors and senior managers end up in court, potentially even prison?

Background

Misleading advertising in the UK is regulated, in the main, by a dual legislative and regulatory framework.

Legislation

On the legislative side, the Control of Misleading Advertisements Regulations 1988 (CMARs) are the main tool. While the CMARs are due to be replaced when the Government (finally!) implements the Unfair Commercial Practices Directive (UCPD) in May 2008, in relation to misleading adverts the wording of the proposed replacement regulations is very likely to have the same effect as the CMARS.

The CMARs regulate "advertisements" that are "misleading". The definition of an "advertisement" is incredibly wide and would include all print, television, radio, mobile, website, poster and leaflet advertising and marketing methods.

An advertisement is "misleading" if it "in any way, including its presentation, …deceives or is likely to deceive the persons to whom it is addressed or whom it reaches and if, by reason of its deceptive nature, it is likely to affect their economic behaviour, or for those reasons, injures or is likely to injure a competitor of the person whose interests the advertisement seeks to promote."

The test under the CMARs is objective. It is irrelevant whether the advertiser intended to deceive consumers. Further, there is no need to prove actual deception, the likelihood of deception is sufficient for an advertisement to be misleading. The courts have confirmed that the well-known test of the "average consumer" is to be applied when assessing whose eyes the advert should be judged through, bearing in mind the category of consumer to whom the advertisement is directed. For example, an advertisement in The Times or Vogue magazine may well be less likely to be misleading than an advertisement in The Sun or the Beano.

The OFT has a duty to consider complaints made to it that an advert is misleading. In considering a complaint, the OFT must have regard to all interests involved, in particular the public interest, and Parliament's preference that the advertising industry is controlled by self-regulatory bodies. In addition, the OFT may require a complainant to satisfy it that it has previously been through the "established means" of dealing with complaints, and the complaint has not been dealt with adequately.

If the OFT finds that an advertisement is misleading it can bring proceedings for an injunction against directors or senior managers responsible (breach of which is a contempt of court) or require a party to provide information. The OFT can also seek legally binding undertakings from an advertiser under additional powers. Undertakings in a personal capacity are likely to be sought by the OFT and breach of such undertakings is likely to lead straight to court enforcement action.

Regulation

The independently financed self-regulatory body, the ASA, has been selected by the Government to be the "established means" in respect of both print and broadcast media. The ASA polices several codes, including, as regards non-broadcast media, the British Code of Advertising, Sales Promotion and Direct Marketing (the CAP Code). The keystone of the CAP Code is that all print advertising should be legal, decent, honest and truthful.

What has Ryanair done?

From 30 November to 3 December 2007 Ryanair ran a national press advert which stated: "JANUARY SALE, 2 MILLION SEATS FROM £10 ONE WAY, TAXES AND CHARGES INCLUDED, TRAVEL MONDAY-SUNDAY…"

Complainants said that they were not able to find any cheap flights on Fridays or Sundays. Ryanair said that flights were available Monday-Sunday including Fridays and Sundays. They claimed that thousands had booked flights and they sent the ASA a copy of two booking forms. The ASA asked Ryanair to provide details of the number of cheap flights available on Fridays and Sundays – Ryanair refused.

Just a few weeks earlier, Ryanair ran a press advert where the headline "HOTTEST BACK TO SCHOOL FARES" was followed by a picture of an apparently teenage girl standing in a classroom scantily clad in a crop-top and short skirt school uniform.

Complainants said that the advert was offensive in that it appeared to show a schoolgirl posing and dressing provocatively - lending sexual connotation to the advert. Ryanair said in their defence that only 13 complaints against a circulation of 3.5 million readers demonstrated that the majority of UK residents did not find the advert offensive. They claimed that the model was dressed fashionably and the advert was no less suggestive than many other adverts.

Outcome

The ASA banned both adverts. On the cheap flights advert it ruled that Ryanair's refusal to send details of the percentage of £10 flights for travel on Fridays and Sundays was concerning. It said that Ryanair had failed to demonstrate that the cheap flights were available for travel on all the days quoted in sufficient quantities to ensure readers had a reasonable prospect of obtaining them. The booking forms provided were not sufficient evidence to show this. The advert was ruled misleading – essentially the ASA considered that it was in breach of the CMARs.

Notwithstanding that the flights were said to be "subject to availability", the ASA considered that Ryanair should put on enough flights such that consumers had a reasonable chance of getting a cheap flight.
The ASA held that the schoolgirl advert linked teenage girls with sexually provocative behaviour and was irresponsible and likely to cause serious or widespread offence. The ASA ruled that Ryanair had again fallen foul of the CAP Code.

This latest string of complaints, bringing the total of adverts banned to nine in two years, left the regulator with no option, it said, but to refer Ryanair to the ASA to take appropriate action.

Comment

Just before the Government finalises how advertising will be regulated in light of the implementation of the UCPD, it is interesting to note that, for the first time since 2005, the ASA has felt it necessary to refer an errant advertiser to the OFT. While an ASA ruling often has the de facto effect of an injunction (media owners will refuse to carry banned adverts), it seems the ASA is hoping that the OFT will use the options available to it under the CMARs to take legal action against Ryanair, an option that is not open to the ASA. The draft regulations to implement the UCPD propose that misleading practices traditionally regulated by the ASA will be open to prosecution by trading standards. While the regulations say that trading standards should again have regard to the use of "established means" i.e. the ASA, the Holborn-based regulator may perceive a threat in the new enforcement regime. Perhaps this latest action is a step to demonstrate that it does, in fact, have "teeth" and it is willing to gnash them at recalcitrant advertisers.

Advertisers take note - this may herald a new harder line from the ASA. Businesses would be well advised to ensure that they have their house in order when it comes to advertising compliance.

Ryanair's strange counter-referral does not seem to have an explicit basis in the CMARs. Its frequently intemperate statements about the ASA, describing them as "Absolutely Stupid Asses", literate, innumerate, "unelected, self-appointed dimwits" and accusing them of "unfair procedures, bias and false judgments", will do them no favours in making their inevitably ongoing relationship any easier.

Advertising lawyers await with excitement news of how the OFT will tackle this problem advertiser. Clearly the negative publicity usually surrounding an ASA ban does no significant harm to an airline styling itself as a champion of consumer choice with cheeky, close to the line and bold advertising campaigns. If continued however, such an approach may land some senior people at Ryanair in prison, especially given that the regulations to be implemented under the UCPD have some new criminal penalties for traditionally civil only sanctions.

This analysis was produced by Carlton Daniel, carlton_daniel@wragge.com.