Advertising and Marketing | UK Regulatory Outlook February 2026

CMA publishes explainer on its Green Claims Code with focus on supply chain responsibility  

The Competition and Markets Authority (CMA) has published additional guidance, "Making green claims: Getting it right, across the supply chain", designed to complement its existing Green Claims Code and sector-specific guidance on making green claims about fashion products. It provides further clarity on where responsibility for making environmental claims lies at different points in the supply chain. 

The CMA emphasises that consumer protection law applies to all traders whose practices relate to the promotion or supply of products to consumers, including manufacturers, suppliers, brands, distributors and retailers.  

"Making" an environmental claim includes what businesses say about the environmental credentials of a product (for instance, on their websites or product packaging), how it is presented (including logos and imagery), and what is left unsaid where that information is needed for consumers to make informed decisions (for example, in relation to the disposal of the product for the environmental benefit to be realised). Businesses can be liable where they originate a claim, repeat it (for example, by stocking a product) or pass it on. 

Different businesses in the supply chain may hold the information required to verify claims made to consumers. However, complex supply chains do not dilute legal responsibility. Businesses in the supply chain may need to work together to ensure that claims are accurate and not misleading. Where a business cannot obtain sufficient information to verify a claim, it should change how the claim is made; where it cannot obtain this information because another business is the source of the claim, it may need to consider its trading relationship with that business, given the legal risk. Innocent or unwitting breaches will still infringe consumer protection law, and exercising "due diligence" to avoid making a misleading environmental claim is not a defence in civil enforcement proceedings. 

The guidance includes illustrative examples and practical checklists for retailers, brands, suppliers and manufacturers, to assist businesses in designing internal processes, structuring relationships with other parties in the supply chain, negotiating contractual arrangements and establishing evidence-gathering practices that support compliant environmental claims. 

ASA publishes findings from sweep of green claims in online ads 

The Advertising Standards Authority (ASA) has published findings from a proactive sweep of environmental claims in online ads by major UK travel agents. Using its AI-based Active Ad Monitoring system, the regulator scanned and reviewed 362,000 ads across services allowing consumers to search for and purchase flights, hotels, cruises, holiday transport and flight package deals, combining some or all of those from third-party suppliers, to check compliance with the UK Code of Non-broadcast Advertising and Direct and Promotional Marketing (CAP Code). See this MarketingLaw article for more information on the findings.  

ASA publishes research on recognising influencer advertising  

The ASA has published newly commissioned research examining how people recognise influencer advertising on social media. The findings show widespread difficulty among consumers in identifying influencer ads and strong public demand for clearer disclosure. 

Key findings include: 

• The nature of the social media experience – no ad breaks, highly personalised algorithms and influencers routinely sharing recommendations – makes it inherently more difficult to distinguish paid posts from genuine recommendations.
• Brand ads remain the "gold standard" in terms of clarity: three-quarters of respondents could identify them as "definitely an ad". By contrast, only around half said the same of influencer marketing. However, this stated confidence did not always reflect what happened when people were shown real posts. Confusion ran in both directions: some genuine reviews were mistaken for ads, and paid posts were seen as organic content.
• Regarding the factors that enable consumers to recognise influencer marketing, the research firstly points to a post's content. People draw on a range of signals: brand mentions, excessive positivity about a product, persuasive language, visual product placement, calls-to-action, known brand relationships with an influencer and a general sense that the content "feels different". Such cues may indicate that a post is an ad even without a label. However, clear labels serve as a critical confirmatory backstop – either reinforcing suspicion that a post might be an ad or acting as the sole alert that the influencer post is an ad.
• With respect to labelling, the majority of respondents consider clear labelling essential for identifying influencer advertising. Further, over two-thirds of respondents said that they would like labels to indicate how an influencer was paid or rewarded.
• Notably, a label's wording and placement determine its effectiveness: respondents say that labels should appear upfront, before the caption, so that users are not required to expend additional effort to find them. Labels such as "Commission Paid", "Paid Partnership" and "Ad" are seen as the most effective in conveying unambiguous ad status. 

The ASA observes that existing rules already require influencers to label advertising content. The findings will inform a review of the relevant guidelines to ensure that influencer marketing remains compliant with the CAP Code requirement that all marketing communications be "obviously identifiable as such." 

CAP publishes guidance on the presentation of VAT in advertisements 

The Committee of Advertising Practice (CAP) has published a guidance note on the presentation of VAT in ads. CAP observes that the ASA's position on VAT pricing, reflected in its previous rulings, appears to be aligned with the CMA's new guidance on price transparency under the Digital Markets, Competition and Consumers Act 2024 (DMCCA). The CMA's guidance addresses, among other things, the presentation of various charges, including taxes such as VAT. 

CAP reminds marketers of the relevant provisions of the CAP Code concerning the presentation of taxes and notes that the manner in which VAT should be presented in ads will depend on the nature of the target audience. The note addresses various scenarios, including where customers are consumers, businesses or a mixed audience, as well as the presentation of prices in sponsored search results. 

It has also developed an "Advertising VAT Compliance Tool", which is an interactive resource designed to assist advertisers in determining whether prices in their ads are required to include VAT. 

CAP explains the ASA's remit on cross-border ads 

CAP has published an article explaining the ASA's remit in relation to cross-border ads. It explains that ads on a marketer's own website with a ".uk" top-level domain, non-paid-for marketing communications from or by marketers with a UK-registered company address and paid-for marketing communications from or by marketers targeting consumers in the UK will fall within the scope of the CAP Code. 

When considering what "targeting UK consumers" means, marketers might consider the following factors (although this list is not exhaustive): 

• Where an ad appears – if an ad has appeared on a website based in the UK, it is likely to be targeting a UK audience.
• The manner in which an ad is served – marketers should consider whether the ad has been targeted to someone based on their location.
• The ad's content – marketers should ask themselves whether there is something about the content that targets UK consumers. Relevant indicators may include: using prices in pounds sterling, providing consumers with a UK telephone number or geographic address for support, inviting consumers to visit physical premises in the UK, referring to a product or service that is only available in the UK or the marketer being subject to regulation under UK regimes (for example, being subject to regulation by the Gambling Commission). 

Where an ad falls outside the scope of the CAP Code, the ASA may refer it through the European Advertising Standards Alliance (EASA) cross-border complaints process, which co-ordinates complaints between self-regulatory organisations across most EU Member States and many non-European countries. If the ASA cannot refer a complaint via this process for any reason, it will consider taking what action it can if the ad specifically targets UK consumers. 

The CAP Code will apply to any direct marketing communications (emails, mailings, text messages) sent from marketers within the UK. Where a message is sent from abroad, it will fall within the jurisdiction of the relevant organisation in that country. Where a referral through EASA is not possible, the ASA will take what action it can. 

Advertising Association publishes best practice guide for the responsible use of generative AI in advertising 

The Advertising Association has published a new voluntary "Best Practice Guide for the Responsible Use of Generative AI in Advertising", developed under the auspices of the UK government and industry-led Online Advertising Taskforce. It builds on and puts into practice the IPA and ISBA principles for ethical AI use in advertising published in 2023. 

It takes into account UK legal and regulatory frameworks (including the UK GDPR, the Data Protection Act 2018, the Equality Act and the DMCCA), as well as the advertising codes and ICO and ASA guidance, providing practical interpretation of their application in the generative AI context. The Advertising Association states that while it has been developed for the UK market, its principles are sufficiently flexible to accommodate international interpretations and applications.  

The guide is focused on eight core principles: 

• Transparency: disclosure of AI-generated or AI-altered advertising content should be determined using a risk-based approach that prioritises the prevention of consumer harm.
• Responsible use of data: personal data used for generative AI applications, including model training, algorithmic targeting and personalisation, should comply with data protection law and respect individuals' privacy rights.
• Preventing bias and ensuring fairness: generative AI systems should be designed, deployed and monitored to prevent discrimination against and ensure fair treatment of all individuals and groups.
• Human oversight and accountability: AI-generated advertising content should be subject to appropriate human oversight before publication, with the level of oversight proportionate to the potential for consumer harm.
• Promoting societal wellbeing: generative AI should not be used to create, distribute or amplify harmful, misleading or exploitative advertising content. Where possible, AI should be deployed to enhance consumer protection and advertising standards.
• Brand safety: organisations should assess and mitigate brand safety and suitability risks arising from AI-generated content and AI-driven ad placement, ensuring generative AI systems align with brand values and safety standards.
• Environmental considerations: when selecting generative AI tools and approaches, organisations should consider the environmental implications alongside business objectives, favouring energy-efficient options where practical.
• Monitoring and evaluation: generative AI systems, once deployed, should be subject to continuous monitoring to detect performance degradation, bias drift (where outputs become progressively more skewed over time), compliance failures or other issues that may require intervention.