I'm about to write something that's probably more editorial than usual, and not intended to be a short sound byte, so, be warned. But, if you're interested in the business of business, and how it is impacting us all, it's an important read
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The only possible legal/rational defense I can think of for this supplier's new policy is if the venue in question explicitly forbids the specific sort of material that this supplier provides, and the supplier wants to avoid getting dragged into any future legal action that would ensue from someone advertising their product(s) in the venue in question. However, what little you've said on the matter causes me to infer that the venue in question does not have any such restriction against the material this supplier provides...
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