Regulators Probe UK Broadcasters Over Agency Credit Demands

15 July 2003

Regulators are investigating a complaint against British broadcast consortium TV Eye over demands made to ad agencies.

In April, the Institute of Practitioners in Advertising filed a formal complaint against TV Eye, which represents terrestrial networks ITV, Channel 4 and Five among others.

The IPA objects to demands that agencies to have an equal debt-to-equity ratio in order to minimise broadcasters’ exposure to charges triggered by the rash of accountancy irregularities stateside. TV Eye wants agencies without such a ratio to raise their insurance status via bank guarantees; failing this, agencies would have to pay for advertising in advance.

The OFT last week revealed it was conducting a ‘section 25’ probe. “We have been examining if there is sufficient evidence of a breach of the Competition Act and are taking it a stage further,” it stated.

Data sourced from: Media Week (UK); additional content by WARC staff