The Law Amending Certain Legislative Acts regarding Prohibition of Advertising, Sponsorship and Stimulation of Sales of Tobacco Products (the "Law"), which forbids tobacco advertising, came into effect on 17 September 2012.

Regulation. The Law forbids, among other things, advertising of trademarks and other IP objects which are used for tobacco products. This ban covers the following areas:

1. TV and radio;
2. printed media and other printed publications;
3. external outdoor and internal indoor advertising;
4. advertising on the means of transport;
5. events with of an advertising characternature;
6. mass events for minors;
7. Internet.

Other types of stimulation of tobacco sales, such as providing buyers of such products with compensations, bonuses, rights to participate in games, lotteries, are prohibited as well.

The Law sets forth, however, some exceptions when tobacco advertising is allowed. They include, among others, permission for use tobacco trademarks on goods connected with smoking (lighters, ashtrays), as well as on Internet websites for adults which require determination of visitors' age.

Sanctions. The Law provides for the following sanctions:

Financial sanctions imposed on business entities by the State Consumer Protection Inspectorate:

1. for each fact of banned advertising on each advertising medium or for each banned tobacco sales stimulation event - a fine of UAH 30,000 up to 50,000.

Fines which can be imposed by the State Consumers Protection Inspectorate on individuals:

1. a fine from UAH 85 to 170 (UAH 255 to 425 if repeated the same year) - for engaging in prohibited advertising of tobacco products;
2. a fine from UAH 1,700 to 4,250 (UAH 3,400 to 5,950 if repeated the same year) for officers of companies which order and/or circulate advertising materials - for prohibited advertising of tobacco products, smoking or showing tobacco products in advertising of other products, as well as forbidden sponsorship of any events using IP objects which refer to tobacco products.

The Law is in general aimed at making smoking less popular. Nevertheless, some of its rules may threaten successful fulfillment of this task. For instance, it is almost impossible to control the real age of web site visitors in order to implement the rule providing that only sites for adults may advertise tobacco. This may lead to ineffectiveness of the ban imposed on tobacco advertising on the Internet. From now on, tobacco producers and resellers should, however, pay much attention to be sure that their actions in promotion of their products fit those strict requirements set forth by the new law.

For further information please contact partner Oleksandr Padalka
and senior associate Illya Onyschenko