ARCHIVED -  Public Notice CRTC 1995-142

Public Notice

Ottawa, 21 August 1995

Public Notice CRTC 1995-142

Call for comments on proposed revisions to the regulatory framework governing the broadcast of alcoholic beverage advertising

1. Background

In May 1986, the Commission conducted a public hearing relating to its regulation of alcoholic beverage advertising. At that time, the focus of the Commission's examination was its pre-clearance of scripts for beer, wine and cider commercials and the scope of the guidelines contained in its Code for Broadcast Advertising of Alcoholic Beverages (Code). Subsequent to the hearing, the Commission adopted a revised Code. The broadcast advertising of spirits containing 7% or less alcohol by volume was permitted, while the prohibition against advertising for spirits containing more than 7% alcohol by volume was maintained.

The framework established by the Commission for the broadcast of alcoholic beverage advertising consists of provisions regarding the nature of such advertising, included for the most part in the Code, as well as the requirement that the scripts for such advertisements be pre-cleared by a representative of the Commission.

Over the years, criticisms directed at the Commission's regulation of alcoholic beverage advertising have focused on two matters: the content guidelines contained in the Code; and the alleged portrayal of alcoholic beverage consumption in association only with "the good times", with the harmful effects of excessive alcohol consumption being rarely, if ever, depicted. In August 1994, the Advisory Committee made specific recommendations to the Commission regarding amendments to the Code.

2. Recent developments

a) Judgment of the Federal Court of Canada, Trial Division

In Public Notice CRTC 1990-86 dated 11 September 1990, the Commission called for comments regarding a proposal to amend its regulations by eliminating the distinction between the regulatory treatment of broadcast advertising of beer, wine, cider and coolers on the one hand, and of spirits containing more than 7% alcohol by volume on the other.

Prior to issuance of the notice, the matter had been placed before the Federal Court in an action initiated by the Association of Canadian Distillers (ACD) challenging the constitutional validity of subsection 6(2) of the Television Broadcasting Regulations, 1987 (television regulations). That provision, in effect, prohibited the broadcast advertising of spirits-based alcoholic beverages containing more than 7% alcohol by volume. In its pleadings, the ACD claimed that the provision violated its freedom of expression, as guaranteed in section 2(b) of the Canadian Charter of Rights of Freedoms (the Charter), and could not be justified under section 1 of the Charter. Under the Charter's section 1, a limitation on a right or freedom otherwise guaranteed in section 2(b) of the Charter must be reasonable, prescribed by law, and demonstrably justified in a free and democratic society.

Because the matter was before the Courts, and because few of the comments received supported the proposed change, the Commission subsequently decided that any further action with respect to the regulations governing the broadcast advertising of alcoholic beverages would await the result of the legal proceedings.

On 12 June 1995, the Federal Court of Canada, Trial Division issued its decision in relation to the ACD's action. The Court declared subsection 6(2) of the television regulations to be of no force or effect, as of 90 days of its judgment, on the basis that it violates section 2(b) of the Charter and cannot be justified under section 1 of the Charter. The Commission considers that, since subsection 4(2) of the Radio Regulations, 1986 (radio regulations) and subsection 4(2) of the Specialty Services Regulations, 1990 (specialty regulations) are identical to their counterpart in the television regulations, these provisions are similarly unenforceable.

b) Proposal for the transfer of the pre-clearance function

Requests for the pre-clearance of advertisements for beer, wine, ciders and coolers are currently processed by Commission staff to ensure that they conform to the Code's standards and to the relevant broadcasting regulations. Staff is assisted by the Advisory Committee on Alcoholic Beverage Advertising (Advisory Committee) which currently includes representatives the Canadian Broadcasting Corporation (CBC), the Canadian Association of Broadcasters (CAB) and the Department of Health and Welfare.

The process involves bi-weekly meetings of Commission staff and the Advisory Committee. Broadcasters, advertisers and their agents submit scripts to the Commission at least seven working days in advance of such a meeting. Scripts for television advertisements must be accompanied by clear and complete written descriptions of their video and audio portions, as well as storyboards, or videocasettes when available in final or rough cut form. Following a review, scripts are approved, rejected, or approved subject to modifications requested by Commission staff. Script approvals are in effect for a period of one year. If advertisements are to be broadcast beyond that period, their scripts must be submitted for re-assessment by Commission staff.

Pre-clearance is a well-established process, one that broadcasters and advertisers have become familiar with over the past ten years. However, based on its monitoring of the pre-clearance function, the Commission is not convinced that it is the most effective use of the Commission's staff and other resources. Moreover, the Commission has been experiencing, and will continue to experience, significant reductions in its budget as part of the Government's program of fiscal restraint. The Commission, however, expects that the volume of work it performs under its pre-clearance function will increase as a result of the recent decision of the Federal Court, and the introduction of increased advertising for U.S. alcoholic beverages, the sale of which is expected to expand under the free trade agreement. In a letter to the Commission dated 5 July 1995, the CAB proposed that responsibility for the pre-clearance of alcoholic beverage advertising be transferred to the Canadian Advertising Foundation (CAF). In a letter to the Commission on 6 July 1995, the CAF indicated its consent to this proposed transfer of the pre-clearance function. The Commission notes that, for some time, the CAF has been pre-clearing broadcast food advertisements on behalf of the industry, and is thus well-acquainted with the function and its responsibilities.

c) Changes in the retailing of alcoholic beverages

The CAB also requested in its letter that the current provisions contained in the regulations that restrict who can sponsor commercial messages for alcoholic beverages be amended. According to paragraph 6(3)(a) of the television regulations, paragraph 4(3)(a) of the radio regulations, and paragraph 4(3)(a) of the specialty regulations, commercial messages for alcoholic beverages may only be sponsored by brewers, wineries, distillers or cider houses.

The CAB noted that liquor stores in Alberta have been privatized by the provincial government and that other provinces may soon adopt a similar approach. On 23 February 1994, the Commission received a letter from the responsible Minister of the Government of Alberta advising that the province was prepared to remove existing provincial restrictions to permit radio and television advertising by retail liquor outlets. The Minister encouraged the Commission to take similar action by amending the regulations to permit retail liquor stores to advertise in the broadcast media.

3. The Commission's proposals for changes to the regulatory framework governing advertising of alcoholic beverages.

Many countries around the world that regulate broadcasting have recognized that alcohol advertising calls for regulation because of the serious, sometimes devastating, health and social consequences associated with excessive consumption of alcoholic beverages. A variety of regulatory approaches have been adopted. Content guidelines for alcoholic beverage advertising similar to those contained in the Code have been adopted in many of these countries. In addition, numerous other steps have been taken to address specific concerns relating to such advertising. For example, broadcasters in some countries are responsible for ensuring that a balanced approach to alcohol consumption is presented to television and radio audiences. To this end, broadcasters are required to air informational messages regarding alcohol consumption or to provide free air time for public service announcements.

Regulators in other countries have also responded to concerns regarding the saturation of the airwaves with advertising of alcoholic beverages and, in particular, the exposure of young viewers to such advertising. To address these concerns, restrictions have been imposed concerning the hours during which such advertisements can be broadcast. In some countries, attempts have been made to avoid saturation of the airwaves with such advertisements through prohibitions against the broadcast of consecutive alcoholic beverage advertisements.

a) Changes to the Code

The Commission has reviewed the specific wording of the Code's provisions with a view to correcting a number of discrepancies and shortcomings that have been noted over the years. The modifications proposed by the Commission are contained in the Proposed Revised Code for Broadcast Advertising of Alcoholic Beverages attached to this notice as Appendix A. The proposed revisions to the Code are intended to strengthen the provisions relating, among other things, to lifestyle advertising, the use of youth symbols and of role models for youth, and the association of the product with the operation of vehicles and conveyances or with activities requiring skill and alertness. The modifications include the addition of an interpretation section, which is attached as Appendix B. While this section does not form part of the Code, the Commission intends to interpret the Code in accordance with it.

The Commission calls for comments on its proposed revised Code.

b) New requirement for educational messages

The Commission considers it appropriate that viewers be informed of the harmful consequences of excessive alcohol consumption. Such a view is supported by the requirement contained in the Broadcasting Act (the Act) that the public be given a reasonable opportunity to be exposed to differing views on matters of public concern. In addition, the Act specifies that licensees have a responsibility for the programs they broadcast and for ensuring that they are of high standard. The Commission is also mandated to ensure that the Canadian broadcasting system serves to safeguard, enrich and strengthen the social fabric of Canada. In furtherance of the objectives of the broadcasting policy for Canada, as set out in the Act, the Commission proposes to amend its regulations by adding requirements that licensees choosing to broadcast alcoholic beverage advertising ensure that their audiences are exposed to messages containing information advising viewers of the dangers related to excessive alcohol consumption.

The Commission therefore calls for comments on its proposal to require licensees who broadcast advertisements of alcoholic beverages also to broadcast messages informing audiences of the effects of excessive alcohol consumption.

Without limiting the scope of the matters dealt with in the submissions, the Commission invites
comments with respect to the following issues in particular:

1. How should the appropriate ratio between commercial messages for alcoholic beverages and informational messages on broadcasting undertakings be determined, and what should the specific ratio be?

 For example, should the approach specify a required number of informational messages based on the number of commercial messages for alcoholic beverages broadcast, or should the required ratio be based on the amount of time devoted to such commercial messages?

2. Should licensees be permitted to exclude informational messages from their calculations with respect to the existing hourly time limit on advertising material?

3. What type of guidelines should be established for the content of informational messages?

c) Advertising by distillers

As noted above, the Commission has previously proposed to amend its regulations in order to permit distillers to advertise their products under the same regulatory regime as now applied to brewers and vintners. In Public Notice CRTC 1991-65, the Commission decided not to take further action with regard to the proposed amendments, pending the outcome of the related legal proceedings. Given completion of these proceedings, the Commission now intends to enact the amendments to its television, radio and specialty regulations, as originally proposed for public comment in 1990, thus rendering the regulations consistent with the judgement of the Federal Court.

d) The pre-clearance function

In the context of the Commission's plans to strenghten the Code in a number of important areas, and the fact that compliance with the Code will continue to be required by regulation, the Commission is not convinced that the pre-clearance process remains necessary, practical or effective. Accordingly, it hereby requests comments on whether it would be appropriate to amend the television, specialty and radio regulations by removing the preclearance requirements.

Alternatively, should it ultimately be decided to retain the pre-clearance requirements, the Commission invites comments as to whether responsibility for performance of the pre-clearance function should be transferred to the CAF, as proposed by the CAB. The Commission again notes in this regard, the CAF's experience in pre-clearing broadcast advertising of food products, its expressed willingness to assume responsibility for pre-clearing commercial messages for alcoholic beverages, and the budgetary constraints confronting the Commission.

e) Proposed treatment of no claim advertising, sponsorship mentions and public service announcements

All commercial messages containing references to alcoholic beverages must conform to the regulations and the Code and, at present, must also be pre-cleared by a representative of the Commission. As described below, there are a number of types of advertising that are not neces-
sarily commercial messages. Some of these have been subject to the pre-clearance process, while others have not.

* No claim advertisements: these refer to a product by name, but make no claim as to the attributes or qualities of the product. They are primarily intended to promote events such as rock concerts or sporting events. At present, such advertisements are subject to pre-clearance, despite the fact that they contain no material covered by the Code.

* Sponsorship Mentions: these often take the form of acknowledgments of sponsors during program credits, such as "this program is brought to you by (product name)". In other cases, the name of a product may appear in the title of a program, such as "Labatt's Blue Jay Baseball". The Commission has long considered these types of sponsorship mentions to be part of the program. Most often, they are not reported by broadcasters as commercial messages on program logs, and they are thus not subject to pre-clearance. In the case of alcoholic beverages, however, many advertisers submit these sponsorship mentions to the Commission for approval, essentially for the sake of convenience, even though the broadcaster may subsequently choose not to log the sponsorship mention as advertising material.

* Public service announcements: the television, specialty and radio regulations all state that a licensee shall not broadcast a commercial message advertising, directly or indirectly, an alcoholic beverage, except under certain conditions, i.e. when the script of the commercial message complies with the Code and has been approved by a representative of the Commission. In the television and specialty services regulations, the definition of advertising material includes both public service announcements and commercial messages, but distinguishes between them as constituting different forms of advertising material. Nevertheless, the Commission continues to receive a number of requests each year for pre-clearance of public service announcements.

In the circumstances, the Commission is of the view that the three types of messages described above should not require pre-clearance, since they do not present advertising messages showing the benefits of a particular brand or product.

The Commission therefore requests public comment as to whether it should interpret the television and specialty regulations in a manner that no claim advertisements, sponsorship mentions and public service announcements would not be considered to be commercial messages, and thus would not require pre-clearance.

The radio regulations currently contain a definition of a "commercial message" that makes reference to a content category that includes sponsor identification and promotions, as described in Public Notice CRTC 1991-19. Accordingly, the Commission also requests comments as to whether it should amend the radio regulations so as to exclude sponsor identification and promotions from the definition of a commercial message, thereby eliminating the requirement for pre-clearance.

The Commission wishes to emphasize that, if it adopts its proposal to exclude the types of messages described above, all commercial messages would continue to be subject to the requirements of the regulations, including adherence to the Code.

f) Restrictions on who can advertise

As noted earlier, the provincial government of Alberta and the CAB have requested that the current restrictions regarding who can sponsor alcoholic beverage advertising be removed. In its letter of 5 July 1995, the CAB states that "public concern is with the advertisement not the advertiser".

As noted above, the regulations restrict who may sponsor a commercial message for an alcoholic beverage to brewers, wineries, distillers and cider houses. While bars may promote events such as dances or musical performances, and restaurants may promote their food, advertisements for such establishments may not depict or promote the sale of alcoholic beverages; they may merely state that they are licensed.

The Commission requests comments on whether it should amend paragraph 6(3)(a) of the television regulations, and corresponding provisions of the radio and specialty regulations, to permit anyone involved in the sale of alcoholic beverages to be able to advertise, including bars, restaurants, pubs, beverage producers, liquor stores, or other retailers of alcoholic beverages.

Comments on any or all of the issues raised in this public notice, together with additional or alternative suggestions for revisions to the existing regulatory framework governing alcoholic beverage advertising, should be addressed to Allan J. Darling, Secretary General, CRTC, Ottawa, Ontario, K1A ON2 and should be received no later than 20 November 1995. While receipt of submissions will not be acknowledged, they will be considered by the Commission and will form part of the public record of the proceeding.

Allan J. Darling
Secretary General

APPENDIX A

PROPOSED REVISED CODE FOR BROADCAST ADVERTISING OF ALCOHOLIC BEVERAGES

Commercial messages for alcoholic beverages shall not:

(a)  attempt to influence non-drinkers of any age to drink or to purchase alcoholic beverages;

(b) be directed at persons under the legal drinking age, associate any such product with youth or youth symbols, or portray persons under the legal drinking age or persons who could reasonably be mistaken for such persons in a context where any such product is being shown or promoted;

(c) portray the product in the context of, or in relation to, an activity attractive primarily to people under the legal drinking age;

(d) contain an endorsement of the product, personally or by implication, either directly or indirectly, by any person, character or group who is or is likely to be a role model for minors because of a past or present position of public trust, special achievement in any field of endeavour, association with charities and/or advocacy activities benefiting children, reputation or exposure in the mass media;

(e)  attempt to establish the product as a status symbol, a necessity for the enjoyment of life or an escape from life's problems, or attempt to establish that consumption of the product should take precedence over other activities;

(f) imply directly or indirectly that social acceptance, social status, personal success, or business or athletic achievement may be acquired, enhanced or reinforced through consumption of the product;

(g) imply directly or indirectly that the presence or consumption of alcohol is, in any way, necessary to enhance an activity or an event;

(h) portray any such product, or its consumption, in an immoderate way;

(i) exaggerate the importance or effect of any aspect of the product or its packaging;

(j) show or use language that suggests, in any way, product misuse or product dependency, compulsive behaviour, urgency of need or urgency of use;

(k) use imperative language to urge people to purchase or consume the product;

(l) introduce the product in such a way or at such a time that it may be associated with the operation of any vehicle or conveyance requiring skill;

(m) introduce the product in such a way or at such a time as may associate the product with any activity requiring a significant degree of skill, care or mental alertness or involving an obvious element of danger;

(n) contain inducements to prefer an alcoholic beverage because of its higher alcohol content;

(o) refer to the feeling and effect caused by alcohol consumption or show or convey the impression, by behaviour or comportment, that the people depicted in the message are under the influence of alcohol;

(p) portray persons with any such product in situations in which the consumption of alcohol is prohibited; and

(q) contain scenes in which any such product is consumed, or that give the impression, visually or in sound, that it is being or has been consumed.

APPENDIX B

INTERPRETATION SECTION OF THE CODE FOR BROADCAST ADVERTISING OF ALCOHOLIC BEVERAGES

With reference to paragraph (a):

A message must not challenge or dare people to drink or to try a particular alcoholic beverage.

In the event of a promotion, contest or premium offer, there must be at least one clearly stated option that permits participation without purchase of the product and without cost to the participants. It must also be stated that participation is limited to those who are of legal drinking age in the province where the message is to be aired. In television advertisements, in deference to members of the audience who may have impaired vision or hearing, such options and restrictions must be described both verbally and in writing. The written version of the message must be of such size, placement and duration as to be clearly visible.

With reference to paragraph (b):

The message shall be overtly directed to persons who are of the legal drinking age in the province where the message is broadcast. No such message should depict, under any circumstances, children, children's toys, children's clothing, playground equipment, or wading pools. Objects that are commonly used by children, but not considered childish when used by adults (e.g. most sports equipment, frisbees and colouring pencils) may be depicted in such messages. Mythical or fairy tale characters appealing to children, such as Santa Claus, the Tooth Fairy or the Easter Bunny, should not be depicted in such messages under any circumstances.

With reference to paragraph (c):

The product should not be portrayed in the context of, or in relation to, for example, a performance, event or activity where the audience or the participants are expected to be predominantly people under the legal drinking age, or where the television or film audiences of the featured performer(s) or purchasers of recordings by the featured performer(s) consist predominantly of people under the legal drinking age.

With reference to paragraph (d):

Once established as a role model for minors, a person will be considered to remain a role model for a period of 10 years from the date of retirement from the activity.

With reference to paragraph (g):

Commercial messages shall not suggest that the presence or consumption of alcohol may create or contribute to an apparent change in mood, atmosphere or environment, or that a social gathering, celebration or any other activity is, or would be, incomplete or unsatisfactory without the product. In the depiction of alcoholic beverages as part of a celebration, advertisements shall not imply or suggest that the presence or consumption of the beverage, itself, was a cause of, or contributed to, the success being celebrated or to the success of the social gathering.

It is acceptable to say that one alcoholic beverage is superior in some way to any or all other similar alcoholic beverages, but it is not acceptable to suggest or imply that it is superior to any or all foods or non-alcoholic beverages.

With reference to paragraph (h):

Under this provision, a message shall not portray (i) an unrealistic or excessive number of cases of containers or any excessive volume of the product in a context where consumption may reasonably be expected to occur; or (ii) any quantity of containers or volume of the product in a context where the number of individual standard servings represented exceeds or may appear to exceed the number of individuals shown. This provision does not prohibit depiction of the manufacturing, warehousing, distribution or commercial storage of alcoholic beverages.

With reference to paragraph (l):

Introduction of the product will be deemed to have occurred upon the introduction of a flat label, jingle, musical signature, logo, brand name, character or other symbol used to identify the product or its manufacturer. It is unacceptable to suggest or imply that the product is or should be consumed prior to or during operation of any vehicle or conveyance or the riding of an animal. It is acceptable to suggest or imply that consumption may occur after all operation depicted in the message has been clearly completed for the day. It is also acceptable to suggest or imply that consumption may occur (among passengers only) on an aircraft or vessel operated by a professional crew.

With reference to paragraph (m):

Introduction of the product will be deemed to have occurred upon the introduction of a flat label, jingle, musical signature, logo, brand name, character or other symbol used to identify the product or its manufacturer. It is unacceptable to suggest or imply that the product is or should be consumed prior to or during any such activity. It is acceptable to introduce the product after all such activity depicted in the message has been clearly completed for the day.