As Digital Video Recorders, which allow viewers to skip over traditional advertising, become more prevalent among TV watchers, product placement will become an increasingly important channel to get products in front of consumers.

"The situation at the moment is a farce anyway, " said a source at a Dublin advertising firm who asked not to be named. "Today I can quietly go to one of a handful of firms in the UK to subcontract a product placement. The programme will be seen on digital and satellite in Ireland. It's a nonsense."

Last December EU commissioner Vivian Reding announced her intent to update the 1997 Television Sans Frontieres directive.

"Since then there are many more television stations, " she said last December. "The system for product placement is complete anarchy at the moment. My aim is for Europe's audiovisual content industry to flourish under one of the most modern and flexible sets of rules in the world."

Product placement was pioneered by American TV advertisers in the 1990s, getting their products into popular shows like The X-Files . . .

which featured Ford cars . . .

and Friends.

It has an even longer pedigree in Hollywood, going back at least as far as the 1982 film, ET . . . The Extra-Terrestrial.

The cuddly alien was paid to have a penchant for Reese's Pieces peanut butter candies, instead of the M&Ms that appeared in early versions of the script.

"Nobody from the industry wants to challenge the regulator in public, " said another source. "But no one is under any illusions about the fact that the draft code isn't worth much if it fails to recognise the reality that Europe is going to do this anyway."