Political advertising in the EU: fit for the digital age

• Democracy
• Digital

The EU has agreed on new rules for political advertising to better protect elections across Europe. They include clear transparency obligations and restrictions to so-called “targeting” techniques. In the night of 7 November 2023, the EU co-legislators reached a provisional agreement. 

The Regulation was needed to ensure that advertising technologies cannot be used to spread disinformation and manipulate voters. Unfortunately, only a few rules will be effective for the 2024 European elections. This is an overview of the most important measures and what they mean in practice. 

What is the new law on the transparency and targeting of political advertising? 

The Cambridge Analytica scandal and the Brexit referendum have highlighted that voting behaviour and election results can be manipulated – and that the targeting of potential voters has become a serious threat to our democracy. The EU Council and Parliament therefore agreed on new rules for political advertising to safeguard that opinions can be formed independently and freely and to thereby protect democracy in Europe. 

The law regulates three areas: transparency, targeting and rules for the provision of services in the internal market. Transparency is created by making political adverts directly recognisable as such for everyone. Targeting involves customised political messages to a specific person or group of people, which are intended to influence them based on their data profile. This targeted manipulation is limited by the new rules. 

Only a few rules will come into force early, from 1 January 2024, so that they are effective for the European elections on 6-9 June 2024: Article 2 (definitions) and Article 3a (prohibition of discriminatory restrictions on cross-border services). 

All other rules (transparency labels, targeting restrictions, the advertising database, etc.) will only apply 18 months after entry into force.  

What is the key improvement? 

Up until now, targeting techniques could be used to direct personalised political messages to a specific person or group of people. With the new rules however, it is no longer permitted to target individuals on the basis of profiles using special categories of personal data (political opinion, health status, sexual orientation, etc.). The prohibition is generally applicable and does not only focus on one of the actors in the advertising supply chain. This text therefore goes beyond the Digital Services Act, that also includes such a prohibition for online platforms only. The associated recital in the political advertisement Regulation now importantly highlights that such profiles can also be established if other personal data is used in a way that sensitive data is revealed about an individual (inferred data). This also applies to data generated when users interact with content on social networks, for instance when liking certain posts (observed data). 

Important additions have made it into the final text: if a person refuses to consent to data processing by automated signals (the “Do Not Track” browser function), consent may not be requested. In addition, the person who doesn’t consent to data processing must be given another option to use the service without political advertising. 

Furthermore, it is now prohibited to target political adverts at people who are one year below the voting age.  

Unfortunately, the agreement does not go far enough: while the European Parliament called for further restrictions on targeting, which would have led to a common public sphere for political advertising, the Council insisted on continuing to allow targeting based on non-sensitive data. 

Better protection against targeting practices would have been particularly important for our democracy: we all leave behind extensive data trails every day. Online services such as Facebook or Google Search analyse our personal data to extract information about income, shopping behaviour, age, interests, sexual orientation, life situation, political and religious beliefs – and either use it themselves or sell it on for advertising purposes. 

The risk of polarisation and fragmentation of the public debate as well as the targeted manipulation of voters based on this data is high: research by the German ZDF Magazin Royale in April 2021 showed that contradictory election promises were shown to potential voters by the same party. During the federal election, people who were interested in “green” politics according to Facebook’s data analyses were shown an advert by the FDP in which the party advocates for the protection of the environment. Another target group, on the other hand, received the message from the FDP that there should be no “government measures, restrictions on freedom or bans” when it comes to “climate change”. 

What is “political advertising”? 

A message is considered “political advertising” if it: 

• is disseminated in return for payment or similar consideration or for which payment would normally have been made, and 
• is distributed by or on behalf of a political actor (parties, candidates, etc.) – unless the message is of a purely private or purely commercial nature (e.g. if a politician places an advert for the sale of her boots on a second-hand portal), or 
• if it is liable and designed to influence the outcome of an election or referendum, or a legislative or regulatory process or voting behaviour.
  

Messages by other actors such as individuals or civil society organisations may therefore fall within the scope of application – but only if the above criteria are met. 

The definition of “political advertising” applies not only to the use of paid services, but also to so-called “in-house” activities. This means that the rules of the Regulation must also be complied with when disseminating messages that are prepared internally and disseminated externally without payment or a contract. This means that the rules also apply to political parties, for example, if they use an internal database containing personal data or hire data analysts to send targeted political advertising. 

What is not “political advertising” and exempt from the Regulation? 

The following is not “political advertising”:  

• Organic tweets, posts or videos with political views and opinions – as long as they have not been paid for and are not designed to influence the outcome of an election or referendum, a legislative or regulatory process or voting behaviour. 
• Political opinions and other editorial content expressed in media under editorial responsibility, unless specific payment or other remuneration is provided by a third party. 

• Messages from official sources of the Member States or the Union which are strictly limited to the organisation and modalities of participation in elections or referendums. 
• Public communication aimed at providing official information to the public by, for or on behalf of a public authority of a Member State or the Union, including members of the government, provided that it is not designed to influence the outcome of an election, referendum or voting behaviour or legislative or regulatory processes. 
• The presentation of candidates in dedicated public spaces, which is expressly provided for by national law.
  

How will political advertising be labelled? 

Transparency is the basis for the security and integrity of our elections and is essential to expose violations, manipulation and influence from third countries. The Regulation creates three levels of transparency: a label “so that ads are immediately identified as being “political ads” for individuals published with the relevant advert, a “transparency notice” with more detailed information and a public repository for all online ads published in the EU. 

There are different obligations for “sponsors” (clients of political advertising), for providers of “political advertising services” (agencies or online advertising services such as Facebook Ads or Google Ads) and for “publishers of public advertising” (newspapers, TV stations, websites, etc.): 

• Sponsors must make a declaration to the providers of political advertising services that an ad is a political advert. This will be the basis for the advertising service to label the ad accordingly. Sponsors must provide information about their identity and contact details and, where appropriate, communicate information about the organisation that ultimately controls the identity of the sponsor. They must disclose the origin of the sums they pay to the service providers and whether they come from inside or outside the EU. They must declare whether the advertising relates to a specific election, referendum or legislative process. Sponsors must ensure that all information provided to service providers is complete and accurate and update and correct it where necessary without undue delay.
  

• Separate documentation and transparency obligations are introduced for providers of political advertising services. They must document which services have been provided for which political adverts, in which period they have provided services, how much they have charged for the specific services. They have to provide information on the public or private origin of the amounts they have received and whether these originate from inside or outside the EU. This information must be kept in machine-readable format for 7 years and sent to the publisher in a complete and timely manner.
  

• Publishers must provide some transparency information about the advertising they distribute. They must label each ad with the statement that it is a “political advertising”. They must publish the identity of the sponsor with the advert and specify the election, legislative process or referendum concerned. They must state whether the advert was targeted. Finally, they must provide a “transparency notice” that is published together with the advert containing further information on the background of the advert, as well as the logic involved and main parameters used for the targeting techniques, including the specific groups that were targeted and the categories of personal data used. They can provide a link or QR code to the location where this transparency notice can be accessed. Publishers of political advertising must send a copy of each online advert and the accompanying transparency notice to the central repository.
  

What is the EU online advertising repository? 

The Greens/EFA have succeeded with a dedicated article on a European archive for online political advertising. A European repository is crucial to enable research to be carried out promptly and without excessive effort, as this is an important element to help uncover contradictory political campaigns or disinformation in a timely manner. This is particularly crucial as numerous studies show that the previously voluntary advertising archives of Facebook, Google & Co. have failed. They have proven to be incomplete, too time-delayed and often incorrect. 

The Commission must set up a public repository for all online political adverts and host a database. Publishers of political adverts must send a copy of each advert and the transparency notice to this central archive. It must be ensured that all political adverts published in the EU are available in this database for 7 years. The obligation that the archive must show which adverts have been removed is also very important for investigating disinformation campaigns. 

The Commission has 24 months after entry into force to implement the database – it has the flexibility to either run it itself or appoint another Agency or Authority. It might however take at least 3.5 years before the database is up and running. 

How will the financing of ads become more transparent? 

Sponsors wishing to place political adverts in the EU must indicate to the service provider the source of the funds used to pay for the adverts. The transparency notice must also indicate: 

• the aggregate amounts invoiced or other benefits received by the providers of political advertising services; 
• information on the public or private origin of amounts and other benefits and whether they come from inside or outside the Union. 
• the methodology used for the calculation of the amounts and values.
  

Who can run political adverts in the EU? 

When offering cross-border advertising services, providers are not allowed to restrict the service within the EU on the basis of the place of residence or establishment. Political advertising services are prohibited from restricting the provision of the service to a European political party or a political group in the EU Parliament solely on the basis of its establishment. 

There are special rules for the period before an election or referendum, where sponsors in third countries are banned from sponsoring political ads in the EU. 

Are there stricter rules before an election? 

• During the three months before an election/referendum, there is a ban on advertising sponsors from third countries. Organisations not established in the EU are prohibited from sponsoring political advertising in the EU. 
• Adverts that may be in violation of the new rules can be notified or flagged to the publisher. In the last month before an election or referendum, publishers of political advertising must process each flag within 48 hours while SMEs must make best efforts to process reports received without delay.
  

How will the rules be monitored and what sanctions will apply? 

Different authorities in the Member States will be responsible for enforcing the new rules: 

• The national data protection authorities of the Member States are responsible for ensuring that the data protection rules relating to the targeting of advertising are complied with. 
  

• The “Digital Services Coordinators” – the new authorities that implement the Digital Services Act (DSA) – can be made responsible for enforcing the transparency rules. However, other authorities, such as the state media authorities, can also be designated as the competent authority. At EU level, enforcement is monitored and coordinated by a Network of competent authorities.
  

Sanctions can be determined by the Member States, taking into account the context, nature, gravity and duration of the offence as well as the size of the company. Fines of up to 6 per cent of the global annual turnover of a company or sponsor can be imposed. 

CONCLUSION 

This agreement curbs the worst excesses of the division of the political public discourse and the opaque manipulation of voters. Sensitive data such as political or sexual orientation, religion or health status may no longer be used to target political advertising to specific voters. This is a step forward and was a long overdue measure to protect our democracy. 

Unfortunately, the Council has prevented the far-reaching restriction of targeting called for by the European Parliament. All non-sensitive data can still to be used to play out contradictory messages to different groups. We are making election advertising in Europe more honest, but we are still not creating a common public sphere. The core of the regulation only applies 18 months after it comes into force. As a result, the EU has missed the target of protecting the 2024 European elections with strong rules. 

The agreed database for online political advertising is a Greens/EFA success. It makes it possible to make activities of sponsors and services, as well as the financing and targeting, more transparent. This lays the foundation for researchers to uncover contradictory messages, identify disinformation campaigns at an early stage and investigate foreign influence.