REGULATION WATCH;CHANGING OF THE GUARD?;MARKETERS WONDER IF LABOUR WILL WORK FOR THEM

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LONDON-The U.K. opposition Labour Party is working hard to win the hearts of British citizens in the 1997 general election. And to do so, it is willing to adopt regulations that might lose it friends among international marketers.

Labour, led by Tony Blair and out of power for 16 years, has vowed to expand legislation already in effect in some European Union countries and support new EU proposals that ban certain advertising.

The party hopes this action will take advantage of the ruling Conservative Party's declining popularity.

Labour promises to support the EU's proposed total tobacco advertising ban. Action on the directive has been stalled because the current Tory-led government under Prime Minister John Major is holding it up.

"Labour will ban tobacco advertising and promotion, and we will work with our partners in Europe to block the subsidy of [$1.6 billion a year] to tobacco growers," said a policy document issued by the office of Margaret Beckett, the shadow health secretary.

Not surprisingly, advertisers are worried. "We are concerned about the possible imposition of further restrictions," said Lionel Stanbrook, director of legislative and political issues at the Advertising Association.

Mr. Stanbrook also questions Labour's stance on alcohol advertising, especially now that a voluntary 40-year ban on TV ads for spirits was lifted in June. "There is a threat that may surface at the end of this year," he said. The alcohol industry is gearing up for a Christmas holiday blitz of TV advertising.

The association is planning to meet with Labour officials in coming months to discuss the issues of tobacco and alcoholic beverage ads.

Mr. Stanbrook said, "There's a hostility against advertising in general within the [Labour] party. In terms of policy, advertising should be seen as an aspect of the market helping business to grow."

"U.K. Market Focus: The Labour Party," an AMRO Hoare Govett report prepared by Mark Brown, analyst for the financial house, also points out that other sectors, such as retail, leisure industries, banks and insurance marketers will suffer under a Labour government.

Brown believes a Labour government would impose a minimum wage policy, which more or less would dictate to employers how much to pay staff. A bid to impose high tax rates on these companies is also predicted.

The prospect of Labour's takeover does not engender gloom and doom for all regulations.

Roger Edwards, chairman and chief executive officer at Grey London, concluded: "The health sector will do very well under a Labour government, which will be more obligated to provide better healthcare facilities. So will transport. And Labour [ministers] dare not raise the value added tax too high on luxury goods."

A high VAT raise would discourage sales, which would not please manufacturers.

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