Advertising Business Regulation in the Russian Federation
General Provisions on Advertising Business Regulation in the Russian Federation
Provisions of the Constitution of the Russian Federation, laid down in Article 29, which guarantee the freedom of thought and speech, and ensure the right to freely look for, receive, transmit, produce and distribute information by any legal way constitute the foundation of advertising business regulation in the country.
From institutions’ prospective advertising business is regulated by the state as well as by industrial institutions and self-regulatory bodies.
1. Regulation by Public Institutions
Federal Antimonopoly Service (FAS Russia) is a federal-level executive governmental body, which adopts regulatory legal acts and controls the execution of:
• competition law
• law regulating the activity of natural monopolies
• legislation on advertising
• investment activity in corporations which have strategic importance for defense and security of the state
• placement of orders related to supply of goods, delivery of work, or rendering of services for state needs.
Federal Antimonopoly Service is headed by the chairman appointed and dismissed by the Government of the Russian Federation.
Structural units of FAS are departments divided in accordance with major activities of the Service.
The competition body as a state authority controls ex officio the execution of the legislation of the Russian Federation on advertising, and particularly:
1) prevents, reveals and precludes violation of Russian legislation on advertising by individuals and legal entities;
2) initiates and holds proceedings on violation of Russian legislation on advertising.
The competition body is entitled to:
1) issue binding directions to advertisers, advertising producers, advertising distributors aimed at stopping violating Russian legislation on advertising;
2) issue binding directions to federal executive bodies of state authority, executive bodies of all of the subjects of the Russian Federation, local self-government bodies aimed at repeal or amendment of acts adopted by them which are contrary to Russian legislation on advertising;
3) sue an action before courts and commercial courts on prohibition of advertising distribution where such a distribution violates Russian legislation on advertising;
4) sue an action before courts and commercial courts on public disclaimer of unreliable advertisement (counter-advertising) in case of section 38 para. 3 of the Law on Advertising;
5) apply to the commercial court to hold invalid in full or in part non-regulatory legal acts of federal executive bodies of state authority, non-regulatory legal acts of executive bodies of all of the subjects of the Russian Federation and non-regulatory legal acts of local self-government bodies that contradict to Russian legislation on advertising;
6) apply to the commercial court to hold invalid in full or in part regulatory legal acts of federal executive bodies of state authority, regulatory legal acts of executive bodies of all of the subjects of the Russian Federation and regulatory legal acts of local self-government bodies that contradict to Russian legislation on advertising;
7) impose administrative sanctions in accordance with administrative offences law of the Russian Federation;
8) apply to the commercial court to hold invalid in full or in part permission on installation of advertising structures in case of section 19 para. 20 subpara. 1 of the Law on Advertising;
9) issue binding directions to local self-government bodies of a municipal region and local self-government bodies of a state district on cancellation of permission on erection of advertising structures;
10) issue directions on termination of contracts for provision of TV advertising dissemination services concluded contrary to section 14 paras. 3.1, 3.3 of the Law on Advertising.
Federal executive bodies of state authority, executive bodies of all of the subjects of the Russian Federation, local self-government bodies and their officials as well as sole proprietorships, legal entities and their directors must provide the competition body with information required to fulfill state control duties over the execution of Russian law on advertising and provide access to such an information to authorized persons.
Failure to fulfill the requirements results in liability of offender-parties in accordance with administrative offences law of the Russian Federation.
The competition body within the scope of its authority initiates and holds proceedings on violation of Russian legislation on advertising, adopts resulting decisions and issues directions under this Act.
The competition body initiates proceedings on the violation of Russian legislation on advertising at its own discretion, on prosecutor’s recommendation, on citizens’ request or on request of bodies of state authority, local self-government bodies as well as on application of individuals and legal entities.
Failure to comply with directions of the competition body results in liability of parties at fault in accordance with administrative offences law of the Russian Federation.
Decisions and directions of the competition body might be challenged before the court or the commercial court within three months from the date at which the decision was adopted or the direction was issued.
The competition body’s regulations on imposition of administrative sanctions for violation of Russian legislation on advertising shall be challenged and disputed in accordance with law of the Russian Federation.
FAS Russia monitors Law on Advertising compliance and publishes the results of such a monitoring annually.
FAS Russia is currently the main state regulator of advertising market.
2. Regulation by Industrial Institutions
Association of Russian Communication Agencies (AKAR ) is one of the main industrial regulatory institutions of advertising business. The body was founded to consolidate members of the Association including advertising market participants, to determine interests of the industry, to develop and to implement rules (standards) of professional advertising and commercial communication activity, to establish ethic advertising requirements within ordinary practice of the members of the Association and to control their fulfillment, to control professional staff training as well as to analyze from expert point of view state and activities of advertising market and commercial communication development.
AKAR is one of the leading professional unions of advertising and communication market. It currently has 165 national and local members.
AKAR was assigned the following developed ratings: 1) creativity rating of advertising agencies; 2) media agencies’ rating; 3) BTL-agencies’ rating; 4) advertisers’ rating.
AKAR develops industrial standards in the following directions: “Major processes of an advertising agency”, “KPI in interactive projects”, “Relationship between an agency and advertisers”, “Relationship between an agency and service providers”, “Ethic standards”. These rules are developed by profile committees and commissions of AKAR and are recommended to be used by market participants.
AKAR as a group of members, experienced in corresponding fields, represents the industry in state bodies and takes part in law creating processes related to advertising market.
RusBrand, the Association of Branded Goods Manufacturers in Russia , is the largest association of FMCG manufacturers in Russia.
It unites more than 50 Russian and international leading companies. RusBrand includes the leading Russian media market TV advertisers representing the following industry segments: food, tobacco and alcohol industry manufacturers, beauty products and health care products manufacturers, home care products manufacturers, clothes and footwear manufacturers, household appliances manufacturers, pharmaceuticals, telecommunicthe Association of Advertisersations.
RusBrand priorities are located in the IPR protection field, promoting competitive media market development, contributing to constructive collaboration between representatives of the industry and commerce, providing for advantageous business development. Much attention is paid to the establishment of positive relationship with all of the market participants and state bodies. There is no doubt that RusBrand contributes a lot to the functioning of the entire system of advertising community industrial bodies.
Next union that is worth mentioning is the Association of Advertisers . The major tasks of the Association include the following: developing and strengthening of the system of solid advertising freedoms in Russia, promoting for establishing and developing of effective system of advertising business self-regulation in the Russian Federation. With the help of the Association a number of agreements were prepared and signed during advertising self-regulation process developing such as “Obligation of FMGG market participants to limit advertising aimed at minors”. Association of Advertisers is one of the core unions promoting for self-regulation of the industry.
Russian Association of Marketing Services (RAMU) is a non-commercial organization uniting agencies specialized in marketing services in the following directions: Consumer Promotion, Sales Promotion, Event Marketing, Trade Marketing (Merchandising), Direct Marketing/CRM. The Association deals with marketing services industry development, professional promoting, macroeconomic situation analyzing and forecasting, representing members of the Association, developing and implementing common industrial standards in marketing services business and is an organizer of the most important arrangements in this field. Since 2005 it assesses BTL-industry annually and publishes the results of the assessment and also carries out researches on “The attitude of advertisers towards an advertising market” (2010, 2011).
Russian Association of Marketing Services is an official representative of MAA Globes Awards and the organizer of “Serebryany Merkury” competition.
Russian Association “Advertising Federation of the Regions” (RFR) unites regional representatives of advertising business.
It coordinates numerous members of regional community by establishing a business platform for communication, developing common rules and principles. It organizers and holds events in its field.
National Association of Broadcasters (NAT) is a non-commercial organization conducting business connected with the protection of rights and freedoms of broadcasting companies providing for their legal protection and activities of such companies, as well as business on tendency and development assessment of market on broadcasting services, advertising and marketing.
National Association of visual communications (NAVK) represents outdoor advertising market participants. NAVK is primarily aimed at legislation improvement and unification of outdoor advertising placing rules in different regions of the Russian Federation, development of business standards, development of a global outdoor advertising placing approach, implementation of reasonable self-restrictions, information exchange and launching of innovative technologies.
Non-Profit Partnership “Guild of Press Publishers” (GIPP) unites print media representatives. GIPP’s mission is to protect and lobby the interests of publishers, to promote the industry’s development into a competitive, investment attractive business. GIPP’s main goal is to create favorable conditions for the development of the publishing business in Russia. At present there are more than 400 companies in GIPP.
Russian Public Relations Association’s (RASO) mission is to consolidate the efforts of different participants in PR-market to cope with the wide-industry challenges, to develop a PR infrastructure for comprehensive and progressive development of PR sector, to protect the interests of PR sector as a whole and in relation to each and every party thereof, to implement professional and ethic rules in the business practice within the industry, as well as to control their compliance, to develop PR industry staff potential and to improve the quality of higher and post-qualifying PR education.
ICC national committee in Russia (ICC Russia).
ICC Russia’s mission is to strengthen Russian business position in a global business community subject to new tasks and possibilities affected by the globalization.
There is advertising and marketing commission in ICC Russia.
The review of institutions activities indicates that Russian advertising business is regulated by state as well as by industrial bodies. Rules developed by each of them according to appropriate tasks and functions are the basic guidelines for Russian advertising market at present.