A threat to the agency recognition system from new government
legislation has been removed.
The Office of Fair Trading has intimated that it will exempt recognition
agreements between agencies and organisations such as the Newspaper
Society, the Newspaper Publishers Association, the Periodical Publishers
Association and the ITV Association from the upcoming Competition
Newspaper Society chiefs had been lobbying the OFT to protect the
principle of recognition, which could have been rendered potentially
unlawful by the bill, due to receive Royal Assent in four months.
The recognition system has widespread backing across the industry; its
supporters argue that it ensures only financially sound agencies are
allowed credit while reducing the threat of bad debts to media
It is the second time in 20 years that recognition has come under threat
from the OFT, which has previously tried to have it outlawed as a
restrictive practice. In 1978 the OFT permitted it to continue but only
after changes were agreed which led to the first weakening of the
Philip Circus, the Newspaper Society’s advertising law consultant, said
the removal of the system would have posed serious problems for small
agencies, particularly those who are not members of the Institute of
Practitioners in Advertising.
’For a lot of agencies, media recognition is a badge on which they rely
to a large extent,’ Circus added. ’Take away that recognition and their
positions are seriously undermined.’