UK agencies warned not to delude themselves

- Britain's agencies were warned this week not to delude themselves into believing that a new model contract agreed with clients will protect them from all future contractual pitfalls.

- Britain's agencies were warned this week not to delude themselves into believing that a new model contract agreed with clients will protect them from all future contractual pitfalls.

The warning came as the standard contract was unveiled, culminating months of negotiations between the Institute of Practitioners in Advertising, the Incorporated Society of British Advertisers and the Chartered Institute of Purchasing and Supply, representing purchasing managers.

Its aim is to cut time and costs spent agreeing such contracts. It follows surveys showing that advertisers spend an average of 38 man-hours negotiating agency agreements while 70 per cent of large agencies spend more than 25 days a year thrashing out client deals.

But Philip Circus, who led the negotiations on the IPA's behalf, cautioned agencies not to assume they could conclude such contracts without legal back-up.

Circus, the IPA's former legal affairs director who is now the Newspaper Society's advertising law consultant, said: "The standard contract is very good news because it will make agreement of terms much easier."

But he added: "Contracts are still complex and agencies shouldn't try to master them without taking professional advice."

The standard contract is the result of protracted talks between the parties. Among the hurdles which had to be overcome was the uncompromising stance by client representatives on copyright assignment and on tough audit clauses and payment terms.

At one point the CIPS pressed for the agreement to include a clause which linked performance-related bonuses for agencies to penalties for agencies whose performance was deemed sub-standard.

At the same time, the IPA resisted an ISBA move to have an agency "name" all staffers working on an account and to make unauthorised changes a breach of contract. The IPA argued that such a clause would "straightjacket" agencies and impede flexibility.

Circus said: "The best thing about the standard contract is that it has isolated the areas of contention."

Debbie Morrison, ISBA's director of membership services, said: "We already have a long list of members waiting to use the new terms."







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