Product placement is common in Hollywood movies

The practice, which is common in films and sees products featured prominently in programmes in return for payment, is banned under European legislation.

But the European Commission has proposed loosening its rules on TV advertising to allow product placement.

Ofcom said it believes "a cautious approach to the introduction of product placement has merit".

The UK's commercial TV channels are mostly funded by advertising during programmes and sponsorship, with some networks such as Sky One also picking up subscription income.

But executives fear the increasing popularity of personal video recorders will diminish the value of traditional advertising spots, with viewers able to bypass schedules and skip through commercial breaks and sponsorship credits.

Increased choice for viewers as well as video-on-demand services are also threats to the ways networks such as ITV and Channel 4 are funded.

Film placement

Product placement has been evident in films for many years.

Reality TV shows such as The Apprentice have recently featured episodes where contestants work with sponsors.

And an episode of Desperate Housewives saw Eva Longoria's character Gabrielle take on a modelling job in which she promoted car manufacturer Buick.

But US writers and actors have called for a code of conduct to govern the practice.

In March, Ofcom chief executive said he would back a change in the rules.

No-one watches a Bond movie and, unless they are very rich, rushes out to buy the latest Aston Martin," he said.

"So, in principle, why not in television?"