The Advertising Standards Authority (ASA) is closing down.
ASA chief executive Gail Schimmel broke the news after business rescue practitioners Eripio issued a liquidation notice on Tuesday.
“Please take note that the ASA has been put into liquidation and we have been instructed to stop trading with immediate effect‚” Schimmel said.
The ASA is a regulatory body established and paid for by the marketing communications industry to ensure legal‚ decent‚ honest and truthful advertising to protect consumers and the industry.
Eripio issued the notice following a meeting with creditors during which the South African Revenue Service (Sars)‚ the ASA’s main creditor‚ rejected an offer‚ which in turn triggered the liquidation.
Schimmel said: “Why has Sars taken such a peculiar decision? It is a decision that is hard to understand given that the offer would get them more money than they would in liquidation and given that the ASA is a body with a consumer protection mandate.”
Schimmel added: “We realise that on many levels this will cause problems for some of your businesses‚ but can only say that we have done and continue to do everything we can to ensure that there is a financed and empowered self-regulator of advertising.”
The marketing and advertising industries are busy setting up a new regulatory body.
Reacting to the announcement‚ Interactive Advertising Bureau (IAB) chairperson Chris Borain said: “The growth of the digital market has created an important need for self-regulation in this space. The IAB remains committed to the values represented by the ASA‚ and will join with industry to ensure the continuation of self-regulation”.
– Nico Gous