CONGRESS GETS LEGISLATION TO CODIFY CIG AD CURBS: BILLS SEEN BY AD GROUPS, OTHERS ONLY AS A STARTING POINT FOR NEGOTIATIONS

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As expected, there was a flurry of legislation introduced late last week that, as a result of the tobacco settlement, seeks to write into law precedent-setting curbs on advertising.

For the moment, however, both advertising and media groups are professing little worry, especially with the bill introduced by Senate Commerce Committee Chairman John McCain (R., Ariz.) and ranking minority member Ernest Hollings (R., S.C.).

The two senators said the legislation is nothing more than a staff draft of the settlement, which was meant merely to serve as a framework for legislation.

"All it is, is the legislative counsel's draft of the agreement. We do not view this as" indicative of what Congress will do, said John Fithian, an attorney for the Freedom to Advertise Coalition, a consortium of ad and media groups. "We don't believe the legislation reflects the reality of the deal.

"If enacted, [the McCain/Hollings bill] would be unconstitutional," he added.

HIGH PRIORITY FOR '98

Senate leadership put a high priority on acting on the tobacco pact next year, telling committee chairmen it wants committee consideration finished by March 16, just seven weeks after the Senate's return-now expected to be Jan. 26.

The McCain/Hollings bill was one of several introduced last week that offer comprehensive plans for tobacco. Senate Judiciary Committee Chairman Orrin Hatch (R., Utah) was expected to introduce a bill late Friday or Saturday.

KENNEDY MOVE

And Sen. Edward M. Kennedy (D., Mass.)-unable to reach agreement with Sen. Hatch on bipartisan legislation-joined Sens. Richard Durbin (D., Ill.) and Frank Lautenberg (D., N.J.) in introducing legislation that proposes moving all oversight of tobacco advertising to the Food & Drug Administration from the Federal Trade Commission; raising pack prices by $1.50 over three years; and running a major anti-smoking ad campaign.

However it is the McCain and Hatch bills that are likely to get most attention in the Republican Senate.

The McCain/Hollings bill contains all the language that ad groups have most strongly fought, fearing that such statutory language could set a precedent for Congress restricting advertising in other industries.

The bill proposes bans on outdoor ads; humans in ads; giveaways; and ad imagery in magazines with more than 15% readership by those under age 18.

PROTOCOLS OR LAWS?

The settlement tobacco marketers reached with state attorneys general anticipated the companies agreeing "voluntarily" to major ad and marketing restrictions, in "protocols" or consent decrees filed in state lawsuits, rather than made into law.

Mark Buse, policy director for the Commerce Committee, said he anticipated Sen. McCain opening up a hearing next year by immediately moving to strike some of the bill's language.

"What we are trying to do is start with some sort of framework. When it gets to committee, [Sen. McCain] will offer a series of amendments," Mr. Buse said.

Sen. McCain said he probably should have introduced the bill several months ago but expected President Clinton to propose legislation instead.

Ad groups said they believe they can forestall those ad curbs being written into law.

"I believe that there is a growing feeling that speech restrictions legislated in law would be unconstitutional," said George Gross, exec VP of the Magazine

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