A modern day David has scored a victory against a corporate Goliath as the court declared the Advertising Regulatory Board (ARB) is acting unconstitutionally when it makes rulings about non-members and their advertising.

According to a report in The Citizen, Bliss Brands, a local laundry product manufacturer, has taken on one of its competitors, international corporate Colgate-Palmolive, as well as the ARB and won in the Gauteng High Court (Johannesburg).

The Memorandum of Incorporation (MoI) of the ARB and the code allows the ARB to rule against non-members and if the non-member does not comply with the ruling, the members of the ARB are forbidden from accepting the advertising in question.

Although Bliss is not a member of the ARB, it was ordered by the regulator to withdraw the packaging of its hygiene soap brand, Securex, after Colgate-Palmolive, which is a member and sells a competing brand, Protex, complained.

Bliss decided it had had enough of being bullied and challenged the constitutionality of the ARB in court.

Judge Denise Fisher ruled that cause 3.3 of the ARB’s MoI, which grants the ARB jurisdiction over non-members, is unconstitutional, void and unenforceable.

She also ruled that the ARB has no jurisdiction over non-members, and that the ARB is not allowed to issue rulings against or in relation to non-members and their advertising.

The report in The Citizen notes that ruling against the Bliss product was found to be unlawful and set aside.

The ARB must pay back the money to Bliss that was paid to appeal its decision. The ARB must pay the costs for the constitutionality challenge that includes the fees of two counsel and Colgate-Palmolive must pay for three lawyers.

‘We are very pleased with the outcome of this case and hope it can be a step towards levelling the playing field and addressing the stranglehold which the ARB wields over the industry,’ said Dr Liezel Bygate, marketing director of Bliss Brands.

Gail Schimmel, CEO of the ARB, said the regulator is filing an application for leave to appeal.

Full report in The Citizen