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Broadcast Bulletin Issue number 107 - 28|04|08

Standards Cases

Notice of Sanction

Notice of Revocation
In the case of Ebak Ltd (TLCS975) in respect of its service Smart Shop TV

Summary

Ofcom has decided, in accordance with Section 238 of the Communications Act 2003 (“the Act”), that the Licence held by Ebak Ltd (“the Licensee”) to provide the service known as Smart Shop TV (TLCS975) (“the Channel”) should be revoked for the following reasons.

Condition 29(3)(b) of the Licence states that Ofcom may revoke the Licence if there is a change in the nature, characteristics or control of the Licensee such that, if it fell to Ofcom to determine whether to award the Licence to the Licensee in the new circumstances, Ofcom would not award the Licence to the Licensee.

Ebak Ltd, the holder of the Smart Shop TV Licence has remained a dormant company since its incorporation in March 2005 and never traded. The holding company of the Licensee, Smart Shop TV Ltd, entered into voluntary liquidation on 17 March 2008 . As Ebak Ltd never traded, Smart Shop TV Ltd, until it went into voluntary liquidation, funded the television broadcasting operations of the Licensee.

Given the Licensee was a dormant company and the Licensee’s holding company is now insolvent this effected a change in the nature, characteristics or control of the Licensee in such a way that Ofcom would not now award the Licence.

Ebak Ltd was notified on 20 March 2008 that Ofcom was minded to revoke the Licence. The Licensee failed to make any representations. Therefore Ofcom considered that it was appropriate to proceed with the revocation of the Licence with effect from 4 April 2008 .

Prior to revocation, Ofcom had issued formal Directions to Ebak Ltd requiring it to, among other things:

At the time of revocation, Ofcom had also invoked its fast-track sanctions procedure and was considering the imposition of statutory sanctions against Ebak Ltd - including the possibility of revoking its licence. This was for repeated and serious breaches of the Advertising Code and breaches of its Licence conditions.

Background

Ebak Ltd became the holder of Ofcom Licence TLCS975 dated 28 September 2005 for the service known as Smart Shop TV, which was formerly known as Look4Less.

On 20 December 2007 , the ASA referred Ebak Ltd to Ofcom for the consideration of the imposition of a statutory sanction in respect of its service Smart Shop TV. The ASA had found the Licensee in breach of the Code on three separate occasions. These breaches were a result of the Licensee repeatedly failing to provide adequate substantiation to support the claims made in three long-form advertisements during the period March to September 2007. These breaches related to the published adjudications concerning the following advertisements:

These adjudications are available at www.asa.org.uk/asa/adjudications/broadcast/. The ASA also stated that the Licensee had failed to respond to enquiries by the BCAP Executive.

During January 2008, while investigating this case, Ofcom noted that the advertisement for Epil Stop and Spray, which had been subject to the ASA adjudication in September 2007, was being broadcast (on 29 and 30 January 2008 and 1,4 and 5 February 2008). Ofcom therefore issued a Direction to Ebak Ltd under the terms of its Licence requiring the Licensee:

Further, Ebak Ltd was warned that failure to comply with a Direction issued by Ofcom is grounds for revocation of its Licence.

Smart Shop TV confirmed in writing that it had removed the advertising.

At this time, it also came to Ofcom’s attention that the holding company of Ebak Ltd, Smart Shop TV, would be entering voluntary liquidation on 17 March 2008 . Further investigation revealed that Ebak Ltd, the holder of the Licence was in fact a dormant company, and as the Licensee’s holding company was insolvent this effected a change in the nature, characteristics and control of the Licences that would have precluded the original grant of the Licence. Therefore, Ebak Ltd was notified by Ofcom on 20 March 2008 that this was a breach of Licence Condition 29(3)(b) and Ofcom were minded to revoke the Licence. Ebak Ltd was invited by Ofcom to make representations about this matter by 31 March 2008.

As no representations were made by Ebak Ltd, by the deadline, Ofcom duly revoked the Licence with effect from 4 April 2008 .

Decision

Notwithstanding the decision to revoke the Licence under Licence Condition 29(3)(b), Ofcom was separately investigating Licence breaches, breaches of the Advertising Code, and its general poor compliance record. Ofcom considered that the Licensee had seriously, repeatedly and recklessly breached the Code and the terms of its Licence. The Licensee was in the fast-track process for the consideration of the imposition of a statutory sanction. Consideration was to be given to the revocation of Ebak Ltd’s licence in respect of the service, Smart Shop TV.

As the holding company of the Licensee has now been placed into voluntary liquidation and the Licence in respect of Smart Shop TV has been revoked, Ofcom has discontinued its consideration of a statutory sanction for this service. However, the serious and repeated nature of the Licensee’s breaches of the Code and the terms of its Licence indicate to Ofcom that the Licensee (including the persons managing and/or controlling the Licensee) was unable to ensure compliance with the Conditions of the Licence and the relevant Codes.

Under the Act, Ofcom is entitled to refuse an application for a Television Licensable Content Service (TLCS) Licence where, amongst other things, Ofcom is satisfied that if the Licence were granted, the provision of the service would be likely to involve contraventions of the relevant Codes. Ofcom is required by the Broadcasting Acts (as amended) to do all it can do to secure that those applying for a broadcasting Licence, and those holding existing Licences, are not granted new Licences and/or do not continue to hold existing Licences if Ofcom is not satisfied that the Licensee is a fit and proper person or is otherwise disqualified by legislation from holding a broadcasting Licence.

Accordingly, Ofcom reserves the right to consider whether to grant broadcasting Licences in future to the sanctioned Licensee (and those involved in its management or control or otherwise responsible for it) as well as to consider whether such persons should continue to hold/be responsible for any other existing broadcast Licences.

The duty to regulate broadcast advertising is now carried out by the Advertising Standards Authority ("ASA") and its industry arm, the Broadcast Committee of Advertising Practice ("BCAP"). The ASA makes adjudications against the TV and radio codes; BCAP supervises and reviews the codes. This arrangement operates on a formal footing agreed with Ofcom and sanctioned by Parliament. Ofcom has reserved its powers of statutory sanction and can impose sanctions on licensees following referrals of serious cases to Ofcom by the Director General of ASA. The Memorandum of Understanding between the parties can be found at http://www.ofcom.org.uk/consult/condocs/reg_broad_ad/update/mou/.

Under Section 27 of the memorandum of Understanding between Ofcom and the ASA, if a Licensee fails to comply or co-operate fully and promptly with decisions or reasonable requests made by the ASA, the ASA may refer the matter to Ofcom with a request that it consider the imposition of an appropriate sanction in the case of the Licensee. Such a referral was made by the ASA in relation to Smart Shop TV on 20 December 2007 in the light of the broadcaster’s repeated poor compliance record.

In Breach

Place in the Sun
Discovery Real Time, 14 October 2007, 16:00

Introduction

A Place in the Sun is an established long-running series, which assists people looking to find a property abroad. This series, broadcast on Discovery Real Time (“Discovery”), was sponsored by Atlas International, a company specialising in finding properties abroad. During this episode a red interactive prompt button, which was labelled “Free DVD”, remained on screen throughout the duration of the programme.

Ofcom received a complaint from a viewer who accessed the interactive prompt to find an advert for Atlas International, the sponsor of the programme. The complainant expressed concern that an advert for the sponsor was linked to the editorial content of the programme. Ofcom asked Discovery for comments under Rule 9.5 of the Code which says that there must be no promotional references to the sponsor in the content of the sponsored programme.

Response

Discovery was unable to supply a visual image of the interactive element available once the red button had been pressed. However the broadcaster confirmed that the red button with the text “Free DVD” was shown for the duration of the programme and that it took the viewer through to further information about the sponsor Atlas International.

Discovery stated that, although Atlas International was the sponsor of the programme, and further information on the service was available via the red button labelled “Free DVD”, the company had no involvement in the editorial content or scheduling of the programme. Furthermore, there was no direct promotional reference to the sponsor, nor any visual or verbal references to Atlas International, during the course of the programme.

Discovery accepted that there was a “minimal degree of integration of advertising and programme elements” and that the text “Free DVD” was unduly prominent. However, it argued that the editorial independence of the programme was not affected as there were no visual or verbal references to the sponsor and it considered that there was a clear separation between the programme and the sponsor.

Decision

The red interactive button with the text “Free DVD” formed part of the programme content. In this case, when the viewer activated the red button it took the viewer directly to promotional material for the sponsor Atlas International and not to any programme-related material, such as further information about the programme.

There is no absolute prohibition on making references to the sponsor during the programme being sponsored, provided that those references are not promotional and are both editorially justified and incidental, as required under Rule 9.5 (previously 9.6). However, as advised in Bulletin 102 (www.ofcom.org.uk/tv/obb/prog_cb/obb), broadcasters should be aware that any reference to a sponsor within a programme may create a higher presumption of editorial influence by the sponsor. Non-promotional references are more likely to be acceptable if they appear to occur naturally within the programme.

In this particular case a reference to the sponsor’s product, that is a DVD, was featured during the entire duration of the programme. Further, on pressing the red button, viewers were immediately directed to promotional material for the sponsor. This was in breach of Rule 9.5. Even if the on screen reference to the sponsor’s product had not been promotional, it was clearly neither editorially justified nor incidental.

Given that Atlas International was the sponsor of the programme, the inclusion within the programme of promotional references about the sponsor could reasonably have been perceived by the audience as an attempt by the sponsor to influence the programme editorially.

Breach of Rule 9.5

Drivetime with Martin Malyon
Skyline FM, 25 February 2008 , 16:00

Introduction

Skyline FM is a locally run community radio station serving listeners in Eastleigh , near Southampton . Ofcom received a complaint from a listener who claimed that an interview with his daughter broadcast live by the broadcaster was in breach of the fairness and privacy Rules in the Code.

Response

The broadcaster was unable to provide Ofcom with a copy of the programme because its logging system had failed to record the station’s output since the previous point at which it had been reset.

Decision

In the absence of a recording we were unable to consider the complaint put forward in this case. It is a condition of Skyline FM’s licence that recordings of output are retained for 42 days after transmission, and that they must provide Ofcom with any such material upon request.

Failure to supply this recording is a serious and significant breach of the broadcaster’s licence. This will be held on record.

Breach of Licence Condition 11

Resolved

Suicidal Squirrels
AXN Europe, December 2007 and January 2008; various times before the 21:00 watershed

Introduction

This series of one minute cartoons was broadcast at various times during the day in December 2007 and January 2008 on AXN Europe, an entertainment service owned by Sony Pictures Television International (“Sony Pictures”). The channel is licensed by Ofcom but received in various countries across Eastern Europe .

The animation series was titled “Suicidal Squirrels – 100 squirrels kill themselves”. In summary it showed a cartoon squirrel committing suicide in various ways. For example in one episode the character deliberately painted stripes on itself before lying on a zebra crossing to be run over and killed. Its blood-spattered body was thrown onto the windscreen and the gore wiped away by windscreen wipers. In another episode, the squirrel got into a vehicle with a crash test dummy, crashed through the windscreen on impact and there was a slow motion sequence with the character’s skull smashing into a wall and spraying blood. In the title sequence there were shots of the squirrel putting its head into a noose and placing the barrel of a revolver against its head. We received a complaint from the regulator of television in Romania that the subject matter of this series was unsuitable for daytime broadcast when it was likely children would be watching.

Ofcom asked Sony Pictures for their comments in relation to Rule 1.3 (Children must be protected by appropriate scheduling from material that is unsuitable for them).

Response

Sony Pictures confirmed to us that this animation was acquired for post-watershed transmission as an interstitial in place of advertising. It informed Ofcom that it was never the intention that these episodes should be broadcast pre-watershed but a scheduling mistake was made over the Christmas period.

Sony Television agreed that this series was unsuitable for children’s viewing and that it should not have been broadcast during the day, even though AXN’s target audience is over 18. It has now confirmed that Suicidal Squirrels has been removed from the AXN library and will not be transmitted again.

Decision

Sony Television came forward to us voluntarily and independently of the complaint with a full disclosure of the incidents and admitted these scheduling errors. As Sony Television recognised immediately when the compliance issues with this series were pointed out, the subject matter of this animation was not suitable for broadcast before the watershed. Although the character shown was a cartoon squirrel, the content was darkly comic and adult in tone with a sharp contrast between the macabre and violent death scenes and the light-hearted music which accompanied them. The series was a cartoon and therefore more likely to attract children. Despite the fact that this channel is targeted at an adult audience, it was broadcast on an unencrypted service during the day, and children could have come across the series unawares.

Ofcom welcomes the action that Sony Television has taken in contacting the Romanian regulator, assuring it that this series will not be broadcast in future, amending its compliance processes, and broadcasting charity advertisements in place of the slots originally scheduled for the series.

Ofcom therefore considers the matter resolved.

Resolved

Wild and Crazy
Zone Reality, 12 February 2008, 23:00

Introduction

Wild and Crazy is an American series that uses clips of bizarre or comical behaviour and events. It is broadcast on Zone Reality, a channel which, according to the broadcaster, features “the extraordinary aspects of real life”. The item complained of in this programme was made up of Russian clips and was described by the broadcaster as seeking to “highlight the customs and behaviour of Russians that to Western eyes seem strange and at times shocking”.

In this episode a sequence of short film clips shot in a snow covered landscape in Russia showed young babies being briefly submerged in icy water several times and, in one case, a baby being thrown by its arms some ten feet or so into the water before being dunked. The clips were accompanied by commentary explaining that “to Western eyes such activity seems insane, dangerous and completely irresponsible” but that Russian mothers believed the activity prevented winter colds and benefited the baby.

A viewer expressed concern that the images of the baby being thrown a distance and dunked in ice cold water were upsetting and offensive, particularly as the baby was heard crying and appeared to be in distress. Ofcom asked the broadcaster for comments in relation to Rule 2.3 (material which may cause offence must be justified by the context).

Response

The broadcaster told Ofcom that this film was not staged for the purposes of the

programme but recorded a genuine Russian ritual. To criticise the clip of the baby being thrown some distance would therefore “fail to take into account any cultural differences in respect to child rearing practices between UK and Russia ”. Given that the general context of the programme was clearly established at the beginning – that is, unusual events and practices from around the world – the broadcaster believed that programme overall complied with Rule 2.3 because the clips used were justified by context.

Zone Reality pointed to further examples of contextual information that supported the inclusion of the baby sequences: information to viewers warning them about the content (both before the item and within the item’s narration itself), the programme’s late start time, and the programmes scheduled before and afterwards. These all provided context to alert the viewer to the content. In addition, although the narration was tongue in cheek it did make clear the reason why the mothers carried out this activity, and it clearly stated the ritual might seem "insane" and "dangerous" and "completely irresponsible" to Western eyes. Further, the baby who had been thrown some distance into the icy pond was shown safe and unharmed in the arms of its mother after the incident. For the most part the images were, therefore, presented with a degree of contextualising explanation, reassurance and cautionary comment.

However, the broadcaster conceded that, with the benefit of hindsight, the particular sequence of the baby being thrown did have the potential to cause offence and was not fully justified by the context, given that that this activity was not explained as being part of the ritual and was accompanied by light-hearted narration.

Decision

Rule 2.3 states that in applying generally accepted standards broadcasters must ensure that material which may cause offence is justified by context. Context includes, but is not limited to: the editorial content of the programme, the audience expectation, and the degree of harm and offence likely to be caused.

The commentary did provide some editorial context and Ofcom noted that the broadcaster had sought to provide further advice to viewers by including warnings at the beginning of the programme and during the item itself that the material would “shock” viewers and stating that viewers should not attempt to recreate the “stunts” in the programme. However, in Ofcom’s view, the general context – a light-hearted ‘clip-show’ – and the information offered did not fully justify broadcasting the most alarming and upsetting of the scenes showing a baby being thrown some distance.

Ofcom notes that the broadcaster acknowledges that this particular sequence had the potential to cause offence. We also note the broadcaster’s acknowledgement that this clip was not sufficiently justified by explanatory and cautionary material, and had been subsequently marked as unsuitable for broadcast in the context of a programme like Wild and Crazy. Ofcom therefore considers this case resolved.

Resolved

Sky News
Sky News, 24 February 2008, 20:23

Introduction

A news report on Sky News featured an item about the Academy Awards (‘the Oscars’). This item was sponsored by Givenchy. A viewer queried whether segments within news programmes, other than weather forecasts, could be sponsored.

Rule 9.1 of the Broadcasting Code prohibits the sponsorship of news and current affairs programmes on television. We therefore requested Sky’s comments.

Response

Sky said that Givenchy had sponsored Sky News’ coverage of the Oscars for the last four years. It said that the item itself was neither news nor current affairs, but rather “a short specialist report” akin to a sports or a weather report.

However, whilst Sky did consider that in principle the item could be sponsored, it agreed that more could have been done to separate the item from the main news bulletin. It said that, due to the constantly changing broadcast environment implicit in the operation of a rolling news channel, Sky News’ usual rules regarding such items were not implemented on this occasion. Sky advised that Sky News will ensure that in future all short specialist reports are sufficiently separate from news or current affairs programmes.

Decision

The Communications Act 2003 requires that “unsuitable sponsorship” is prevented and "that news included in television and radio services is presented with due impartiality..." and "...is reported with due accuracy." Sponsorship must not compromise these requirements. Further and importantly, European legislation, the Television without Frontiers Directive, states that “News and current affairs programmes may not be sponsored” (Article 17).

Nevertheless, short specialist reports following a news programme may be sponsored. Whilst these tend to be sport, travel, and weather reports, Ofcom accepts that, in principle and depending on the context, an entertainment report may also be sponsored. However, to avoid the impression that the main news is sponsored, the sponsored report must be clearly separated from the news programme, for example by end credits for the news programme, a channel ident, or by a commercial break.

In this particular case, Ofcom considered that the item was not clearly separated, with the result that it appeared to be an integral part of the main news programme. For example, the sponsorship credits for Givenchy came immediately after a news item regarding Hillary Clinton and the Sky News logo was prominently displayed. However, in view of Sky’s recognition of its error on this occasion and assurances regarding future specialist reports, we consider the matter resolved.

Resolved

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