ASA publishes report on targeting of alcohol ads online, BEIS issues report about drone regulation alongside government response, CMA publishes recommendation to UK government on vertical block exemption and more in this week’s round-up of UK, EU and international techlaw news developments not covered elsewhere on the SCL website.
ASA publishes report on targeting of alcohol ads online
The ASA has published findings from a collaboration with five major platforms popular with children, to identify trends in the targeting of ads by alcohol brands in logged-in social media. Between 1 February 2020 and 31 March 2020, Facebook, Instagram, Snapchat, Twitter and YouTube submitted brand-anonymised targeting data to the ASA relating to over 2,000 alcohol campaigns run on these platforms. It identified several incidences of good practices. For example, several alcohol campaigns targeted people who were 25+, minimising the possibility of reaching child account holders. However, it found that some alcohol brands could and should have done more to minimise the possibility of their ads being delivered to children. Overall, the ASA identified eight key insights on targeting practices, including the following: a handful of ad campaigns did not appear to use any age targeting at all. The ASA said that this was very concerning and totally at odds with the letter and spirit of the UK advertising rules and guidance; for the majority that selected an age 18+ audience, many didn’t select any “interests” options to give greater confidence in reaching an adult, rather than a child; and the ASA saw limited evidence of advertisers actively barring their ads from being targeted to audience groups that have interests in topics and themes very strongly associated with under 18s.
BEIS issues report about drone regulation alongside government response
The Department for Business, Energy & Industrial Strategy has published a report from the Regulatory Horizons Council. The report describes how the UK could support the quick and safe commercialisation of drones. In addition, the government has issued its response to the recommendations. The RHC recommends how the CMA and Civil Aviation Authority could help to deal with regulatory challenges by examining the digital platform and data issues. The UK government response agrees with the RHC about opportunities for the UK to harness the benefits of drone technology through proportionate regulation, and the importance of delivering an efficient regulatory system. The government intends to issue further detailed recommendation responses in due course.
CMA publishes recommendation to UK government on vertical block exemption
The CMA has issued a recommendation to the Secretary of State for Business, Energy and Industrial Strategy about whether the existing Vertical Agreements Block Exemption Regulation which has been retained from EU law should be renewed or varied. Without a renewal or variation of the retained VABER, it will expire on 31 May 2022. Having carefully considered the various issues, the CMA is recommending that the Secretary of State replaces the retained VABER with a UK Vertical Agreements Block Exemption Order that will have a duration of six years. The CMA’s recommendation to the Secretary of State is that resale price maintenance should remain a hardcore restriction in the UK Order Although the CMA does not consider it appropriate to introduce fundamental changes to the current exemption, it has set out certain important amendments that the CMA proposes the future UK Order should incorporate relating to online sales and “most favoured nation” clauses. It should also provide guidance on environmental sustainability issues in the context of the CMA Verticals Guidance, in particular, in relation to the criteria for admission to selective distribution systems. It should also clarify that providers of online intermediation services are to be defined as suppliers for the purposes of the block exemption. The CMA also envisages preparing guidance to accompany the UK Order. The CMA is minded to consult on draft guidance later in 2021 or early in 2022.
Ofcom publishes fifth annual report on monitoring net neutrality rules
Net neutrality is the principle of ensuring that users of the internet can control what they see and do online, rather than the internet service provider that connects them to the internet. Ofcom is responsible for monitoring and ensuring compliance with the net neutrality rules in the UK and is required to publish an annual report of its findings. As part of its monitoring and compliance work, Ofcom has published a statement which contains its approach to assessing compliance with the rules, based on its experience to date. It has also published its fifth report on monitoring the rules. It did not identify any particular concerns, although it did mention that it had been alerted to a mobile network's “Fair Usage Policy” that appeared to restrict the use of a mobile SIM card in fixed routers. It contacted the network operator about its concerns.
European Commission opens in-depth investigation into proposed acquisition of Arm by NVIDIA
The European Commission has opened an in-depth investigation to assess the proposed acquisition of Arm by NVIDIA under the EU Merger Regulation. The Commission is concerned that the merged entity would have the ability and incentive to restrict access by NVIDIA's rivals to Arm's technology and that the proposed transaction could lead to higher prices, less choice and reduced innovation in the semiconductor industry. Following its preliminary investigation, the Commission considers that Arm has significant market power on the market for the licensing of Central Processing Unit IP for use in processor products. Therefore, the Commission has concerns that the merged entity would have the ability to restrict or degrade access to Arm's technology by providers of processor products NVIDIA may compete with. The preliminary investigation suggests that the merged entity would also have the economic incentive to engage in such foreclosure strategies which could reduce competition in the market for the supply of processor products across different fields of application. The CMA is also investigating the merger in the UK. The Commission now has 90 working days, until 15 March 2022 to take a decision. The opening of an in-depth inquiry does not prejudge the final result of the investigation.
Commission strengthens cybersecurity of wireless devices and products
The Commission has taken action to improve the cybersecurity of wireless devices available on the European market. As mobile phones, smart watches, fitness trackers and wireless toys are more and more present, cyber threats pose a growing risk for every consumer. The delegated act to the Radio Equipment Directive aims to make sure that all wireless devices are safe before being sold on the EU market. It provides for new legal requirements for cybersecurity safeguards, which manufacturers will have to take into account in the design and production of the products concerned. It will also aim to protect citizens' privacy and personal data, prevent the risks of monetary fraud as well as ensure better resilience of communication networks. The new measures also aim to help to: improve network resilience: Wireless devices and products will have to incorporate features to avoid harming communication networks and prevent the possibility that the devices are used to disrupt website or other services functionality; better protect consumers' privacy: Wireless devices and products will need to have features to guarantee the protection of personal data. The protection of children's rights will become an essential element of this legislation. For instance, manufacturers will have to implement new measures to prevent unauthorised access or transmission of personal data; and reduce the risk of monetary fraud: Wireless devices and products will have to include features to minimise the risk of fraud when making electronic payments. For example, they will need to ensure better authentication control of the user to avoid fraudulent payments. The delegated act will be complemented by a Cyber Resilience Act which would aim to cover more products, looking at their whole life cycle.