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This section refers to transition arrangements prior to, and shortly after, the launch of the new self-regulatory body, which have been agreed between the Parties. Whilst it is not intended that they should be ongoing issues once the system is running, it is felt that they are of sufficient importance to be included in the Memorandum of Understanding.

Files, data, and work in progress

80 Ofcom will transfer to ASA(B)/BCAP all relevant files on advertising policy issues, having due regard to any confidentiality or data protection arising from the relationship between Ofcom and any of its stakeholders including Government departments. Copies of some files may be retained by Ofcom.

81 Ofcom will transfer ownership of the Tracker Complaints Database and Information system to ASA(B)/BCAP at no cost, subject to consent by the system developers, TAH, and to any relevant intellectual property and data protection considerations. ASA(B)/BCAP will be liable for any costs incurred directly from the process of transfer.

82 Ofcom will transfer all advertising complaints case files to ASA(B)/BCAP, either paper-based, or as part of the Tracker system transfer, subject to data protection considerations. ASA(B)'s use of personal data relating to individual complainants is restricted to historical, research or statistical purposes only.

83 The Parties acknowledge that there may be some Advertising Policy issues and/or complaints cases which will still be work in progress at the time of the launch of the new system. After the Order is approved by Parliament, Ofcom will alert all complainants, whose complaints are still open, about the forthcoming change in the system and that undetermined complaints by 1 November may have to be concluded under ASA(B) procedures.

Staffing issues

84 The parties are committed to ensuring that there is adequate staffing within ASA(B), BCAP and Ofcom to deliver an effective co-regulatory system, and that appropriate training and support is provided to those staff. Arrangements for the deployment of staff and for the provision of support and expertise from Ofcom are under active discussion and will include consultation with staff affected and the relevant trades unions. The details will be set out in the contracts to be agreed between the parties.

Recovery programme

85 If the new system consistently fails to meet the agreed standards, the Parties would open discussion at Senior Partner or Director General level about appropriate corrective measures. These might include:

• A review by Ofcom of "case handling" procedures and outcomes
• Ofcom entering into discussion with broadcasters and advertisers, with the co-operation of the co-regulator, to determine where and why the system is failing
• If necessary, proposing that an Ofcom trouble-shooting team works with co-regulator staff to iron out problem areas
• As a last resort, suspending the co-regulatory system and taking broadcast advertising regulation back into Ofcom.

86 It is agreed that such a breakdown of the proposed arrangements would be unsatisfactory from every point of view and all parties commit themselves to making the new system work through co-operation in good faith and with goodwill. It is not intended that any of the Parties will attempt to extract themselves from the arrangements set out in this MoU and the Authorisation within the initial probationary period of two years.

Notice period

87 Notwithstanding Ofcom's statutory powers, it is the intention of the Parties that the system described in this document should operate for a minimum of two years from inception, and thereafter for a further eight years (a total of ten years), with the intention it should be renewable thereafter. After the first two years, any Party may give advance notice in writing to end the delegation of Ofcom's powers under the Authorisation and this MOU, and the minimum notice period shall be 6 months. The exact details of what should happen as regards the allocation of costs and liabilities incurred by the Co-regulatory Parties as regards the self-regulatory system set out in this MOU, in the event of the delegation of Ofcom's powers under the Authorisation and this MOU being terminated, shall be agreed by the Parties in due course and set out in a legally binding contract(s). But the Parties agree the following general principles to govern the allocation of costs and liabilities in the relevant contract(s).

88 If the Authorisation is terminated by Ofcom because of the incompetence of any of the Co-regulatory Parties, or material breach by any of the Co-regulatory Parties of terms of the Authorisation or of other material obligations (whether legally binding or made in good faith as reflected in the MOU, an opportunity to remedy having been given where appropriate), Ofcom shall not be liable for any costs or liabilities incurred by the Co-regulatory Parties other than those referred to in paragraph 89. In any other circumstances (including, without limitation, the Co-regulatory Parties ending the delegation of Ofcom's powers under the Authorisation as a result of Ofcom interfering in the exercise by the Co-regulatory Parties of the Ofcom functions delegated to them contrary to the terms of the Authorisation, or in breach of other material obligations, whether legally binding or made in good faith as reflected in the MOU, an opportunity to remedy having been given to Ofcom where appropriate), Ofcom will compensate the Co-regulatory Parties for reasonable and unrecovered system costs as part of a financial settlement to be set out in more detail in the legally binding contract(s) referred to above. This settlement will include any reasonable financial liabilities incurred as a result of having to give up premises.

89 In any case, reasonable costs and liabilities in connection with the transfer of staff from the Co-regulatory Parties to Ofcom will be borne by Ofcom.

Amendments to the MOU

90 Any Party to this MOU may propose alterations to it at any time, and all other Parties promise in good faith to discuss any such proposals as soon as practicable with a view to reaching agreement and amending the MOU accordingly.

Signatories to this MOU:

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Any queries relating to this document should be addressed to:

Ian Blair, Advertising Co-regulation Manager

Ofcom
Riverside House
2A Southwark Bridge Road
SE1 9HA

Tel: 0207 981 3880
e-mail: ian.blair@ofcom.org.uk

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