ABC Tightens Rules on Third-Party Sales

By: Lucia Moses

Updated at 12:45 p.m. Eastern Standard Time, July 17

Responding to advertisers’ concerns about certain uses of the third-party sales rule, the Audit Bureau of Circulations (ABC) board last week tightened its rules governing bulk copies that qualify as paid circulation, a bureau spokeswoman said. The ABC also issued rulings on day-of-week reporting, bulldog editions, and electronic editions.

The ABC reported the actions Wednesday on its Web site,

Meeting in Bermuda last week, the 36-member ABC board acted to limit third-party sales to primarily consumer-oriented organizations. If a sponsorship program lasts longer than a month, the ABC board also ruled, papers must notify recipients at least monthly of the sponsor’s identity. The board also tightened the rules governing how papers must disclose the cost of bulk copies to advertisers. The ABC further ruled that free-standing inserts do not have to run in sponsored copies to qualify those papers as editions of the home paper.

All the changes take effect Oct. 1.

In addition, the board ruled that when accepting goods and services as payment for bulk copies, papers must account for the value of goods and services as revenue.

In other matters, the board ruled that papers that deliver a Sunday bulldog as part of a third-party sales program to households already subscribing to the Sunday paper may only count one of the copies as paid circulation.

The board gave papers the option to report circulation by day of week, while directing ABC staff to look into the feasibility of requiring day of week reporting, starting April 2005.

Previously, papers were allowed to report circulation of a certain weekday in their publisher’s statements only if that day’s circulation varied from the average for the other days of the week by 5% to 15%. But advertisers have been asking for more detailed circulation information to guide their buying decisions.

The board also gave first passage to two rules, one tightening the parameters of electronic editions, and one requiring papers to keep daily records of copies sold at between 25% and 50% of the basic price.

Final passage could come at the board’s next meeting, scheduled for November.

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