Ministry of Communications supports bid to liberalise advertising law in wake of covid-19 pandemic
- The Ministry of Communications has forecast that the Russian advertising market could shrink by as much as 25% to 30% by the end of 2020
- The ministry is considering the possibility of liberalising the advertising law to allow for the advertisement of prescription medicines, sport poker and alcohol
- This would bolster the industry by attracting additional market participants with bigger marketing budgets
The advertising market, like most others, has been significantly affected by the covid-19 pandemic and its ongoing financial fallout. The Russian Ministry of Digital Development, Communications and Mass Communications (‘MinComSvyaz’) has forecast that the Russian advertising market could shrink by as much as 25% to 30% by the end of 2020.
Deputy Minister Alexey Volin addressed this issue at a meeting of the State Duma Committee on Information Policy, IT and Communications on 12 May 2020. To support mass media during this period, the ministry is considering the possibility of liberalising the Law on Advertising in order to allow for the advertisement of prescription medicines, sport poker and alcohol.
Following the ministry’s initiative, the association of Russian online cinemas - Internet-Video - presented Prime Minister Mikhail Mishustin with a request to amend the Law on Advertising to allow such advertisements in mass media and on the Internet.
The letter, available on open sources, states:
In order to compensate for the lost advertising profits of video services, which result from the general recession of the industry following the introduction of the anti-pandemic measures, it would be reasonable to allow the advertising of prescription medicines and broaden the possibilities of advertising alcohol in the Internet and in mass media by amending Articles 21 and 24 of the Law on Advertising.
These changes would bolster the industry by attracting additional market participants with bigger marketing budgets. The request was also sent to the Ministry of Communications and the Federal Anti-monopoly Service (FAS), which oversees compliance with the Law on Advertising.
Earlier this month, the National Association of Television Broadcasters also submitted to the State Duma Committee on Information Policy, IT and Communications a letter suggesting that it should support regional TV channels in view of the situation resulting from the pandemic. The liberalisation of the advertising legislation was among the proposed measures.
In accordance with the current regulations, the advertising of prescription medicines and alcohol is heavily restricted. The law forbids their advertising online, outdoors, in periodicals, on television and radio, and in cinemas.
This recent initiative is not the first of its kind. In 2015, following the economic crisis of 2014, MinComSvyaz presented a similar anti-crisis plan in an attempt to stabilise the situation in the industry and support local mass media. However, the plan was not supported by the FAS at that time.
The issue is now in the development phase, and it is yet to be seen whether it will be approved by the FAS and submitted as a legislative initiative to the State Duma. Nevertheless, given the economic situation, the need for a rapid response and the pressure from the market players, it is expected that the FAS will take a more liberal position and give the Ministry of Communications the green light. Alternatively, the plan could be adopted simply as an interim measure, as suggested in 2015.
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