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How we manage advertising compliance

28 October 2020

The TGA's approach to managing advertising compliance is consistent with the TGA Regulatory Compliance Framework, which contains information about our compliance principles, triage systems and range of compliance and enforcement tools.

The regulatory requirements

The Competition and Consumer Act 2010, administered by the Australian Competition and Consumer Commission (ACCC), as well as associated state and territory laws, protects consumers from false or misleading advertising of products and services.

To further protect the health and safety of Australian consumers, the advertising of therapeutic goods in Australia is subject to additional requirements contained in the Therapeutic Goods Act 1989 (the Act) and the Therapeutic Goods Advertising Code (the Code), administered by the TGA.

Our principles for managing advertising compliance

The following principles guide our advertising compliance processes:

  • we focus our resources on alleged non-compliance that presents the highest risks to public health, safety, and confidence in therapeutic goods regulation
  • we provide extensive education resources to assist advertisers manage their compliance obligations
  • we consider the impact on the reasonable consumer when assessing advertising
  • we take compliance and enforcement actions proportionate to the level of non-compliance and the level of harm that may result from the advertiser's actions
  • our compliance and enforcement actions are evidence-based and informed by the types of behaviours identified, including demonstrated willingness of the advertiser to become and remain compliant, and
  • we show our commitment to transparency by reporting on enforcement actions and compliance outcomes.

The TGA takes non-compliance with the regulatory scheme seriously, especially where a breach of the advertising requirements has resulted in, or poses, a threat to public health and safety. A range of compliance and enforcement tools are available to address non-compliance and may include criminal or civil court proceedings, which can result in substantial penalties, fines, or imprisonment.

Our approach to advertising compliance

Advertisers have an obligation to ensure that their ads are compliant with the legal requirements. We take the following regulatory approach to managing compliance.

Diagram showing our approach to advertising compliance - the text is in the web page

1. Educate

We educate advertisers, consumers, health professionals and industry to promote voluntary compliance with the advertising requirements. We invest in these activities because they are beneficial for advertisers and consumers, and are an effective way to achieve overall compliance.

Education activities assist advertisers to apply the advertising requirements by providing information that:

  • raises awareness of their legal obligations
  • helps advertisers understand how to comply and meet their obligations, and
  • keeps advertisers updated on changes to the requirements.

Education activities empower consumers by:

  • helping them to recognise non-compliant advertising, and
  • ensuring that consumers know how to report suspected non-compliance.

We distribute news and information about therapeutic goods advertising through a range of channels including:

  • the Advertising Hub and the Compliance and Enforcement Hub on our website, both of which contain educational material and other information, such as media releases and web statements
  • social media such as Facebook, Instagram, Twitter, YouTube and LinkedIn
  • face-to-face engagements such as workshops, roadshows and focused SME Assist seminars
  • webinars
  • printed and electronic fact sheets, and information for industry publications
  • public consultations, and
  • engagement with key stakeholders including through the Therapeutic Goods Advertising Consultative Committee (TGACC) and a range of other industry fora.

We also respond to enquiries about the advertising requirements. To make an enquiry, visit the Advertising Enquiry form.

2. Detect and Assess

Using a combination of our own monitoring activities and community reports of suspected breaches, we collect information on alleged non-compliant advertising for assessment and triage.

Reporting non-compliance and case selection

We receive reports of suspected advertising non-compliance from members of the community via the online form.

Once received, the report is assessed considering:

  • our jurisdiction to take action in the matter
  • the risk of harm to consumers
  • the nature of the breach
  • the vulnerability of the target market
  • alignment with the advertising compliance priorities, and
  • the size, reach and compliance history of the advertiser.

This risk assessment informs whether the report is converted into a case for immediate investigation or is stored in our database for intelligence purposes. Reports of non-compliance that become part of our intelligence database are used to determine compliance priorities and may be selected for investigation at a later time.

The information provided through community reports is highly regarded and is held in strict confidence. We do not release information to the public about compliance and enforcement activities, such as current investigations, unless required by the investigative process or in the public interest.

Members of the community who submit a report through the online form will receive a notification of receipt. We do not provide further updates regarding the case. We publish outcomes from court decisions and the enforcement actions as permitted by legislation. Case outcomes can be found in the Compliance and Enforcement Hub on our website:

Selecting matters for investigation

Investigations into alleged non-compliance will be determined in one of the following ways:

  • the matter is related to an annual compliance priority and part of the associated compliance operation
  • the matter is related to a compliance operation that arises during the year
  • the matter is of higher risk and selected as an individual case for investigation, or
  • the matter has been selected for action from a lower risk report stored in our database.

Advertising compliance priorities

The advertising compliance priorities are reviewed annually. They are determined using a combination of intelligence held from community reports, proactive detection and analysis, and consultation including TGACC input. We also consider information from other regulators to identify emerging risks.

Below are some of the factors we consider when assessing whether an operation, or individual case, is appropriate:

  • reports that collectively suggest an emerging trend within an industry sector that poses a current or future public health risk
  • an entity with a number of low-risk breaches that may not otherwise be linked (e.g. multiple products in different product categories produced by the same manufacturer)
  • a particular illness, disease, disorder or condition that advertisements may target (e.g. a lesser-known condition that affects vulnerable communities who are more susceptible to targeted non-compliant advertising)
  • the quantity of reports and the number of different reporters alleging the same breach, suggesting that a larger group of people have been affected
  • a number of low-risk breaches that all link to a public health concern or contradict a public health campaign (e.g. a public health risk that results from advertising that reduces the perception of risk associated with tobacco, alcohol or obesity), and
  • the introduction of significant regulatory changes for therapeutic goods, or a class of goods, or significant emerging markets in therapeutic goods, may also result in a compliance priority to ensure awareness of the advertising requirements and early intervention, as a preventative measure.

This table sets out the current advertising compliance priorities.

ADVERTISING COMPLIANCE PRIORITIES
Priority 1

Therapeutic goods associated with COVID-19

Priority 2

Stem cell products

Medicinal cannabis

Performance and image enhancers

Therapeutic goods used in the cosmetic and beauty industry

Hangover cures

Weight loss products

Priority 3

Mental/learning acuity products

Bioresonance products

3. Respond

Our response to advertising non-compliance is proportionate to risk and the nature of the breach, and is determined on a case-by-case basis.

Going from high compliance risk and high compliance cost to low compliance risk and low compliance cost: Compel, Direct, Advise, Support. Successful responsive regulation creates pressure downwards as more entities are encouraged to become voluntarily compliant.
Figure 1 Adapted from John Braithwaite's Pyramid of Compliance

The range of education, compliance and enforcement tools that may be applied in a case include:

  • education and guidance
  • administrative responses, including warnings or cautions
  • negotiating an enforceable undertaking
  • applying for an injunction
  • issuing a directions notice
  • issuing an infringement notice
  • issuing a public warning notice
  • cancellation or suspension of a product from the Australian Register of Therapeutic Goods (ARTG), and/or recall of the goods, and
  • applying to the court for criminal prosecution or civil penalties.

Where appropriate, an advertising case may require consideration of other breaches of the Act, including import, manufacturing and/or supply offences.

Advertisers are responsible for ensuring their advertising is compliant. Where there is a serious breach of law we will pursue administrative, civil and/or criminal sanctions.

4. Measure and Report

We measure and report on our performance to ensure accountability and continued improvement.

Our advertising assurance function has been designed to assess ongoing compliance across a sample of closed cases. The sample is made up of cases that were identified for monitoring, as well as a random selection. The sampling includes both cases from compliance operations, and individual cases that were selected for investigation.

The TGA is committed to transparency and offers a number of reports that provide information on our regulatory functions. Outcomes from advertising investigations can be found in the Compliance and Enforcement Hub on our website:

Key performance indicators (KPIs)

The TGA provides information on performance through a variety of reports published on the website. The Therapeutic Goods Advertising Compliance Annual Report provides comprehensive information on advertising compliance and case studies for advertisers for each financial year. Performance information is also reported in the half-yearly TGA performance reports and in the Regulator Performance Framework. The TGA uses a mix of both qualitative and quantitative indicators.

The TGA will measure and report on the following in relation to advertising:

Consumer and advertiser awareness

From 2020 the annual TGA Stakeholder Survey will include questions addressing consumer and advertiser awareness of the advertising requirements. Other sources such as social media commentary, mass media reporting on TGA activity, targeted stakeholder surveys and formal feedback from education activities will also be valuable sources of information for reporting against this measure.

Advertiser compliance following compliance response (the compliance rate)

The compliance rate will be measured through the advertising assurance program which has been designed to assess ongoing compliance across a sample of closed cases. The measure will apply to cases conducted as part of an operation, and other cases.

Timely action and achievement of compliance on high risk and critical cases

This KPI will be measured against two factors:

  • time to act: 100% in 10 days
  • time to compliance: 90% in 60 days

Outcome of advertising compliance priorities

Under this KPI we will report on our performance against the planned outcomes of the advertising compliance priorities run during the reporting period, including those open at the reporting date.