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Session 2005 - 06
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Standing Committee Debates
London Olympics Bill

London Olympics Bill




 
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Standing Committee D

The Committee consisted of the following Members:

Chairmen:

Mr. Jimmy Hood,†

Mr. David Amess

Brown, Lyn (West Ham) (Lab)
†Caborn, Mr. Richard (Minister for Sport and Tourism)
†Foster, Mr. Don (Bath) (LD)
†Hillier, Meg (Hackney, South and Shoreditch) (Lab/Co-op)
Lait, Mrs. Jacqui (Beckenham) (Con)
†McFadden, Mr. Pat (Wolverhampton, South-East) (Lab)
†Mann, John (Bassetlaw) (Lab)
†Miller, Mrs. Maria (Basingstoke) (Con)
†Pelling, Mr. Andrew (Croydon, Central) (Con)
†Reed, Mr. Andy (Loughborough) (Lab/Co-op)
†Robertson, Hugh (Faversham and Mid-Kent) (Con)
†Robertson, John (Glasgow, North-West) (Lab)
Selous, Andrew (South-West Bedfordshire) (Con)
†Swinson, Jo (East Dunbartonshire) (LD)
†Tami, Mark (Alyn and Deeside) (Lab)
†Ward, Claire (Watford) (Lab)
†Wyatt, Derek (Sittingbourne and Sheppey) (Lab)
Alan Sandall, Committee Clerk
†attended the Committee


 
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Tuesday 18 October 2005
(Morning)

[Mr. David Amess in the Chair]

London Olympics Bill

Clause 17

Advertising regulations

10.30 am

Mr. Don Foster (Bath) (LD): I beg to move amendment No. 73, in page 12, line 3, leave out

    ‘in the vicinity of London Olympics events’

and insert

    ‘during the London Olympics period which is displayed in or above stadia, venues and other competition areas that are considered as part of the London Olympic sites’.

The Chairman: With this it will be convenient to discuss the following amendments: No. 108, in page 12, line 12, at end insert ‘and’.

No. 109, in page 12, leave out lines 14 to 16.

No. 110, in page 12, line 28, after ‘apply’, insert

    ‘in relation to particular forms of advertising or particular places’.

No. 111, in page 12, line 29, leave out paragraph (a) and insert—

      ‘(a)   in any event the regulations shall in no case apply for a period exceeding the London Olympics period, and’.

No. 113, in clause 18, page 13, line 16, at end insert

    ‘for a period not exceeding the London Olympics period’.

No. 114, in page 13, line 31, after ‘advertising’, insert

    ‘during the London Olympics period’.

Mr. Foster: I am in some difficulty. I have a pretty lousy cold and, on the way to the Committee, the hon. Member for Sittingbourne and Sheppey (Derek Wyatt) and I discussed the current sweepstake among Labour Members on how long I intended to speak to the amendment. Given that I have a vague idea of the length of time that the hon. Gentleman wishes to speak, I shall be going for a little while as we have agreed a 50:50 split of all his winnings. On that basis, I shall begin with a few words of preamble.

We shall be dealing in today’s sitting with some of the most important and potentially the most controversial parts of the Bill. We have debated many issues and we shall debate more on which there is total unanimity that are about the importance of securing the delivery structures to ensure that we deliver on time and on budget in 2012 the best ever Olympic and Paralympic games.

I hope that it is recognised by all members of the Committee that it is crucial for the London Organising Committee of the Olympic Games to raise the money that it needs to protect those organisations and individuals who willingly agree to give money through sponsorship to support the Olympic and Paralympic games. They must be provided with appropriate protection. The LOCOG briefing on market elements
 
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stated that it was important to stress that LOCOG has to raise £510 million from UK sponsors and licensees as part of its £1.5 billion overall operating budget. Therefore, one third of LOCOG’s budget needs to come through sponsors, and we support the broad principle of the Government’s proposal.

However, I share several concerns that have been expressed about the detail and whether there is an element of gold-plating by the Government over and above that which is required in agreements with the International Olympic Committee, particularly in respect of the host city agreement. We shall deal later with clauses 31 and 32 when we discuss ambush marketing, but the summary of the host city contract demands that stakeholders

    “take all necessary steps . . . to prevent/or terminate any ambush marketing or any unauthorised use of Olympic properties”.

It states that the organising committee

    “shall present the IOC with a detailed ambush prevention plan, in accordance with the terms of the Marketing Plan Agreement and the ‘Technical Manual on Brand Protection’, which forms an integral part of this Contract.”

Such details may sound like gobbledegook, but the host city contract refers specifically not only to the summary of the host city contract, but to several technical manuals that deal with the very details that we are discussing. Unfortunately, those manuals are not available to members of the Committee. They would have been enormously helpful had they been available during our deliberation of such issues. I accept that the Minister has been working hard with the IOC to find a way in which to make such information available, but it is important to place on the record that we do not have it. It is therefore difficult to determine whether the claim that is being made by some that the Government are gold-plating is true because we do not have the full detail to hand.

Clearly, there are issues in respect of ambush marketing, which we will return to later, but those areas that we are currently covering under clause 17 relate to other issues, such as time scale. At present, there is nothing in the Bill in respect of advertising that specifies the period of time for which these restrictions on advertising will apply. Of course, many of us presume that those rules will apply during the Olympic period and that that period can be clearly defined by reference to clause 1, which refers to “four weeks before” the start of the games until

    “the fifth day after the day of the closing ceremony of the Paralympic Games”.

The first amendment in this string suggests that we specify that that is the period for which the rules in respect of advertising shall apply.

Clause 17 also refers to vicinity, but that is not defined in the legislation. Therefore, what do we mean when we talk about the area in which these rules on advertising are to apply? Another concern is the whole question of presumption of innocence as opposed to presumption of guilt; I will come on to that soon. Therefore, it is clear that there are areas of genuine concern in respect of advertising, and we have considerable difficulty with some of them, because we
 
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do not know what it is that our country has signed up to; we simply do not have the documentation in front of us.

I state again that I want to help LOCOG protect the sponsors so that that £510 million can be raised. That is important, and I put on the record now that I support LOCOG in respect of adhering to any of the terms and conditions that it has agreed with the IOC and that are contained within the host city contract, and also within the technical manuals, which I have not seen. That seems to me to be a done deal, whether or not we have been involved in it. However, it is important that we tease out some of the details through our discussion of these amendments.

The first of the amendments under discussion is a probing amendment. I am the first to acknowledge that it contains deficiencies. For example, although it talks about the area to be covered, it does not include any reference to locations around the transport network—for instance, along the side of the planned Olympic javelin train or around the Olympic route network. I also accept that the amendment does not make any specific reference to the area immediately outside stadiums or other Olympic venues, and it is important that that is included in the discussion, and also in the rules.

Therefore, I acknowledge at the outset that the amendment has deficiencies. However, I believe that the clause is too broad in both allowing regulations on advertising as a whole, rather than in terms of just a display as our amendment suggests, and in not making any reference to the time period, which our amendment addresses by giving a specific period.

I hope that the Minister will put certain things on the record. I want him to acknowledge the concerns of the advertising and media industries, to undertake to consult them and the Opposition parties in good time before any regulations are issued, and to make it clear that the regulations are not intended to apply and will not be applied above and beyond the tightest definition of the host city contract and any other binding documents. I also want him to acknowledge an intended light-touch implementation—in other words, that newspaper hoardings that do not breach association rules under schedule 3, such as one bearing the title of the Evening Standard, will not constitute a breach of the regulations that are brought forward in due course. In other words, the regulations governed by the clause should relate to the physical display of advertising; the clause should not go broader than that, yet at the moment it gives the Secretary of State additional powers relating to advertising, over and beyond current law and the British code of advertising practice. For example, even though the regulations referred to under the clause discuss only the display of advertising, subsection (1) opens the door for the Secretary of State to make provision regarding the content of advertising. It would be wrong to have that in the clause, not least because the issue of content is covered adequately under clause 31 and schedule 3.

The point is clearly made that we need an agreement on the time limit. We propose the “London Olympics period”, which I have actually defined. Incidentally, I
 
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notice that other amendments in this string have a similar effect; clearly, we are supportive of those amendments, but if ours were accepted, those would not be necessary.

There is also the issue of vicinity. I have said that we need a clear definition of what is understood by that. I appreciate the difficulty of coming up with a clear definition. Indeed, I will be absolutely honest—[Interruption.]—with you, Mr. Amess, if none of the rest of the Committee is listening: I had hoped to table an amendment that gave our own definition of “vicinity”. We spent a long time looking into what was proposed in Sydney and what was done in Atlanta and Athens, and we came to the conclusion that a definition would be extremely difficult to achieve. I, working with one or two members of my staff, am not capable of it, but I have absolute, supreme confidence that the Minister, with all his paraphernalia, back-up and support, is capable of coming up with something. We need such a definition, and it needs to be agreed by Parliament after consultation with all the bodies concerned.

Could the Minister be tempted to look into the Sydney legislation? I would argue that the Sydney proposals on vicinity were far too draconian and tight. It is all very well for the Minister to suggest that we provide something similarly draconian because we will have a light touch, and to say that there was only one prosecution in Sydney and so on, but until we know how the prosecution system will work, the situation will be very difficult.

Those are the key issues at the moment, but as I said, there are others to which we will wish to return, such as ambush marketing and being found guilty before evidence is provided—that seems to be suggested in the legislation, and we think it wrong. I hope that amendment No. 73, as a probing amendment, will at least persuade the Minister to tell us what he is doing on those various issues.

Mrs. Maria Miller (Basingstoke) (Con): I am the vice-chairman of the all-party advertising group, and I declare that as an interest.

All hon. Members here want to ensure the success of the 2012 London Olympics. Our amendments are designed to clarify certain aspects of the Bill to help ensure that we strike a balance between protecting the value of sponsoring and successfully using the Olympics as a catalyst for the wider economic and social good of our country. It is important that we acknowledge that there is a balance to be struck.

Sponsorship and licensing will yield an important income of about £510 million, as has been noted, but staging the Olympic games in London in 2012 will involve an estimated net public subsidy of about £1.1 billion. An initial report, commissioned in May 2002 through Arup, on the costs and benefits of the Olympics stressed the importance of maximising the value of what it referred to as “second order benefits”—that is, economic benefits that are not a direct result of the staging or sponsorship of the games—in order to help eliminate what was defined
 
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then as a financial burden. It is with that objective in mind that I speak to amendments Nos. 73, 108 to 111, 113 and 114.

10.45 am

I support amendment No. 73 because the Bill’s wording, which gives the Secretary of State power to make regulations about advertising in the vicinity of the London Olympics events, is far too imprecise, particularly for the advertising industry. Clause 17 provides the Government with, frankly, quite unfettered powers. What would “vicinity” mean for events in London? Until when would the clause remain in operation? The Government’s objective in the Bill should be to ensure that we meet the IOC standards as set out in the host city contract and in the technical manuals that the hon. Member for Bath (Mr. Foster) referred to earlier, which have unfortunately yet to be made available to Committee members.

Specifically, the host city contract states that

    “no Olympic venues or major access points leading to the Olympic venue shall be encumbered during the period of the games by any franchise or concession or any other commercial agreement, including the right to name the venue to promote . . . any third-party’s products . . . that would conflict with . . . any agreement entered into by the IOC”.

That indicates to me that the amendment as presented would be entirely in the spirit and the word of the host city contract. The London Organising Committee has written to me previously to say that it feels that Parliament should decide on this issue. Indeed, the Government’s own regulatory impact assessment clearly states that this requirement needs to be

    “strictly limited in time and geography”

to minimise the impact on competition. There is some clear evidence, Mr. Amess, that the probing amendment should be taken seriously.

I have also received representations from various media organisations, both directly and through the Advertising Association, that express considerable concern at the possible detrimental impact on outdoor advertising, on the national and regional press and on broadcasters that would arise from the imprecision of the term “vicinity”. Those media fear that the clause creates a high degree of uncertainty and is inoperable as it stands.

To return to my earlier comments on the need to maximise those second-order benefits, we really need some clarity on the issue today. It is not sufficient for the Government to leave such wide scope for intervention. Clarity is required, and the amendment provides that, so we support it.

Amendment No. 115 is aimed at ensuring that any secondary legislation that is subsequently issued under clause 17 is as clear as possible—again to achieve some of the certainty that is required. I therefore propose to delete

    “,or provide criteria for determining”,

because that implies that the Government could have several goes at amending the regulation, and that merely adds uncertainty. The deletion of subsection
 
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(3)(c) is essential. It opens up the entire debate about vicinity, which we have already said is proving problematic.

Amendments Nos. 110 and 111 give the Secretary of State all the flexibility that is required to apply the regulations appropriately and proportionately. Certain forms of advertising may be acceptable in some locations but not in others. I tabled an amendment to subsection (6)(a) because it is not specific enough and leaves the Secretary of State with too much leeway to decide the period for which regulations should apply.

The regulatory impact assessment is useful in this matter. It clearly states that marketing measures need to be

    “strictly limited in time and geography”

to minimise the impact on competition. We see no need for the regulations to apply for longer than the duration of the Olympic period, as has already been stated.

Finally, through amendments Nos. 113 and 114, we want the Government either to amend clause 18(1)(a) in Committee, or perhaps to clarify through Hansard that they are talking only about the limitations as set out in clause 17(2). The purpose of the amendments is to limit the application of the regulations to the Olympic period. The Bill’s current terminology is far too vague, is open-ended and causes a sense of uncertainty. Much of this goes back to terminology adopted in amendment No. 73. There is a need to talk about the London Olympic period, rather than leaving this important issue liable to change at a later date.

I ask the Minister to consider the amendments and I stress the importance of striking a balance. We need to protect the value of sponsorship in the Olympics. I speak with first-hand knowledge in that respect, having spent nearly 20 years in advertising and marketing. Indeed, at one point I worked for an Olympic sponsor company in the Barcelona Olympics. The issue is not only about protecting those interests but the need to obtain the wider social and economic benefit.

The Minister for Sport and Tourism (Mr. Richard Caborn): The point made in the closing remarks of the hon. Member for Basingstoke (Mrs. Miller) is right. The issue is how we obtain the balance. That involves maximising the income from what will be clean stadiums. I am sure that she would be the first to admit that if we get that wrong, do not get the revenue streams from advertising and therefore do not get the money from the IOC that we require, the burden will fall somewhere. It could be on the very people whom she is trying to protect: council tax payers in London. Therefore, it is important that we get the balance right.

Much reference has been made to the technical manuals on the host city agreement. This morning, we received some information from the IOC that ought to be shared with the Committee; it has released some of the technical details. I am getting used to handing documents out. It is like a tutorial. I have yet another document to hand round to the Committee. This time
 
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it does not involve graphics. There are a few words in it, so it might be difficult for the hon. Member for Bath to digest, but I have no doubt that he will do his best.

Mr. Foster: Is it in colour this time?

Mr. Caborn: I will get the hon. Gentleman some crayons later.

The document arrived this morning. A number of technical manuals in draft have been released to the Department for Culture, Media and Sport to assist work on the staging of the games. The IOC is still reviewing the contents of manuals ahead of producing its final version. The manuals have been given to us on the strict understanding that the information contained in them is of a confidential nature. As Members will appreciate, it is important that we in the DCMS and in Government maintain a good relationship with the IOC and respect that confidentiality.

However, I am pleased to say that while the IOC has not agreed to publication of the manuals, this morning it provided us with a summary of those requirements that require legislative action. It has agreed that that can be made available to the Committee to assist in the consideration of the Bill. Most of it will probably relate to this afternoon’s debate.

I hope that the document provides helpful background. I can give Members a summary of the key points and hope that the details will be useful to them ahead of the debate on advertising and ambush marketing, which I think will take place this afternoon. I know that some Members have concerns that we have exceeded the IOC requirements in this area. I think that the words “gold-plating” were used.

The IOC’s definition of ambush marketing is

    “any attempt by an individual or an entity to create an unauthorized or false association (whether or not commercial) with the Olympic Games, the Olympic Movement, the IOC, the National Olympic Committee of the Host Country or the Organising Committee of Olympic Games (“OCOG”) thereby interfering with the legitimate contractual rights of official marketing partners of the Olympic Games.”

The document then outlines the IOC requirements in terms of legislative action to combat ambush marketing. It states:

    “The IOC, as early as in the phase of bidding for the Olympic Games, requires a guarantee from Candidate Cities confirming that, prior to the commencement of the Olympic Games, legislation will be passed in the Host Country which is necessary to effectively reduce and sanction ambush marketing, and to eliminate street vending and control advertising space (including air space) during the period of the Olympic Games . . . The London Bid Committee has provided a guarantee to this effect.”

The IOC asked LOCOG to

    “work to develop and gain approval for the following types of legislation: specific legislation to protect Olympic intellectual property and to prohibit use of confusingly similar words, symbols, terminology and graphic design as well as the unauthorised use of Olympic intellectual properties; Games operations legislation that places restrictions and sanctions on billboard and airspace advertising, street vending, ambush marketing, airspace and other aspects affecting Games-time operations; legislation to combat forms of ambush marketing which are not caught by the above-mentioned legislation but which nevertheless damage the OCOG’s ability to finance and stage a successful Olympic Games.”


 
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On the question of ticket touting, the IOC requires laws that forbid individuals from profiting from selling tickets at above face value, and from advertising and executing such sales. The IOC’s view is that ticket touting is detrimental to the image of the Olympic games, particularly at games time.

That is an explanation of the note that I have just passed round the Committee. I have no doubt that when hon. Members have digested it they will agree that it is probably more germane to this afternoon’s discussion than it is to this debate. However, it is useful information. We are in discussion with the IOC pretty well all the time now, and we will try to pass on to the Committee any further information that we receive from it. I agree with the hon. Member for Bath that it is difficult to have this type of important debate, and to get the balance right—we are all agreed that we must try to get the balance right—without having the IOC’s view. If one reflects on what the IOC says, we are definitely not putting gold-plating into the Bill—if anything we are tending marginally towards the other side.

Before I return to discussing the amendments, I want to put on record the definition of what we call in broad terms the vicinity, and to explain why we do not want to include that in the Bill. We will ensure that regulations are targeted, proportionate and consistent with the European convention on human rights. We intend that the regulations should apply only in the small areas around venues and events that are likely to be full of spectators or captured on camera. In most cases, that is what “vicinity” should mean. We do not want to draw up a blanket definition for inclusion in the Bill because the requirements will be different for different venues. In the close confines of a city centre football stadium, for instance, it would not be proportionate to impose the same sort of restrictions that we might apply to stand-alone Olympic park venues. We have therefore allowed for the regulations to specify a different definition of vicinity for different venues.

When we talk about vicinity, we mean a few hundred metres. In Sydney, to which the hon. Member for Bath referred, the restriction zone was more extreme, at 3 km but, as the hon. Gentleman knows, that restriction was for the Olympic park, which was situated well outside the main city centre, and so was quite confining,. Those sorts of restrictions would clearly not be suitable for a good number of the venues in the UK, and we would not try to impose the type of blanket approach that was used in Sydney.

I am trying to indicate to the Committee that the regulations will be proportionate, both for those who want to exploit the games in the best possible way, and for the protection that the IOC demands for those who put huge amounts of money into advertising. After Los Angeles, there was a great deal of criticism of the IOC, with some justification. It was claimed that sport was following advertising rather than advertising following sport.

In Sydney, we saw a return to the basic principles of the five rings—that is, sport. Although we need commercial sponsors, there is a balance to be
 
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maintained, and we do not want that aspect to dominate the sport. We learned a lot from the shots that went out on television from Los Angeles.

 
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