Kyiv
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Outdoor advertisement market needs clear legislative regulation – experts, business, authorities

Kyiv, February 22, 2017.

Experts of USAID Program “Leadership in Economic Governance” presented their recommendations on the future draft law on out-of-home (OOH) advertisement at a discussion at Ukraine Crisis Media Center. Regulation in this sector is an urgent issue for Ukraine, because at present regulations differ throughout the country and are not always clear.

Oleksandr Pliva, expert of USAID Program “Leadership in Economic Governance”, reminded that the law “On advertisement” has not been amended after adoption of two related laws, “On licensing system” and “On administrative services”. The main bylaw, typical regulations of outdoor advertisement, is not in full compliance with the law “On advertisement”. These contradictions open the door for manipulations of the stakeholders and create difficulties for outdoor advertisement companies, authorities and ordinary people.

De facto this is a situation when the local authorities want to establish detailed and strict regulations on procedure of OOH advertisement placement. But because of several contradictions in the legislation and vagueness of several rules it is very difficult for businesses to comply with them. Moreover, the requirements are sometimes excessive, they contradict to one another and are often updated,” noted Lubomyr Chorniy, senior expert of USAID Program “Leadership in Economic Governance”. “As soon as the government establishes clear and exact regulations, we will have less illegal advertisement and fewer problems in this field,” he added.

“The business will benefit in the case where the rules of the game are exact and clear, when it is possible to plan your strategy not for a year or two, but for five or ten years. If we want to attract investments into this sector, we have to ensure long-term guarantees for businesses,” stressed Oksana Polischuk, executive director of the Association of Outdoor Advertising Companies of Ukraine.

Recommendations

The experts advise that a unified licensing procedure be introduced for all regions and that these procedures be considered as administrative services. The Ministry of Economic Development and Trade agrees with this suggestion. “We should take into account the basic principles of laws “On licensing system” and “On administrative services” and include them into the law “On advertising”, with regard to peculiarities of regulation in this field,” noted Valeriy Prokopets, Deputy Director of Department on Business Development and Regulatory Policy of the Ministry of Economic Development and Trade of Ukraine. The experts suggest that licenses be issued for seven or ten years.

The second recommendation is that a clear distinction be established between signs of identification (signs, sign plates etc.) and advertisement: it is necessary to clarify definitions and establish different regulation for various types of placement. “If these signs are placed on a facility, we should use the law on facilities; if they are placed on facades, we should use the law on principles of city construction,” noted Oleksandr Pliva. They also suggest that local authorities have right to establish requirements with regard to architectural and historical peculiarities of the city. Among the novelties is the requirement to receive approval of the owner of a building or of the authorized person.

The experts also advise that licensing mandate and additional functions of local authorities be separated; that procedures of approval be decentralized and simplified. “We want that these decisions could be made by authorities of the lowest local level. Moreover, we suggest that exact deadlines be established, and that automatic tacit approval could be used in several cases. We also suggest that a limited list of grounds for refusal be approved,” noted Lubomyr Chorniy. In addition, they suggest creating an open database of sites for ad placement, for that OOH companies could see what sites are available and local authorities could control this activity.

Other suggestions include establishing clear requirements on marking outdoor advertisement and clear procedure of dismantling advertisement that has been placed illegally; clear mechanism of planning advertisement positioning according to defined schemes, with regard to peculiarities of cities and areas of the city. It is also recommended that market players could participate in elaboration of these schemes within the regulatory procedure; that outdoor advertisement companies could receive sites through competition and that there was a clear mechanism of ad pricing calculation.

It is also important that the future law include mechanisms of control on its implementation. “This is a sector where there are corrupt schemes, and those involved will not give up this practice unless we ensure serious pressure and control,” stressed representative of a Public Council at the State Regulatory Service.

The draft law requires massive support

The joint work on this draft law and compromise between all the stakeholders would increase transparency and improve environment for doing business. Representatives of the local authorities noted that if the basic law was more detailed, it would be easier for them to elaborate local regulations and avoid disputes with the business.

Lubomyr Chorniy noted that there is a number of similar draft laws registered in the Parliament. The experts started negotiations with their authors for that all these documents could be merged into one draft law. “It is important that all associations, both regional and national, as well as authorities of local self-governance, everyone who wants their voice be heard, joined this process by sending letters with suggestions, participation in discussions that will take place in the future or by addressing their associations. (…) It would consolidate our efforts to let these changes happen,” he noted.

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