Sales Promotion

Sales promotion is regulated in the United Kingdom by the Consumer Protection from Unfair Trading Regulations 2008, The Business Protection from Misleading Marketing Regulations 2008, Consumer Protection Act 1987, Lotteries and Amusements Act 1976, Tobacco Advertising and Promotion Act 2002, Gambling Act 2005 and UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code).

Unfair commercial practices, whether misleading or aggressive, are prohibited.

A commercial practice is a misleading action if it contains false information and is therefore untruthful or its overall presentation in any way deceives or is likely to deceive the average consumer, even if the information is factually correct, in relation to the price or the manner in which the price is calculated or the existence of a specific price advantage, and it causes or is likely to cause the average consumer to take a transactional decision he would not have taken otherwise.

The following are sales promotion commercial practices which are in all circumstances considered unfair:

  • Bait advertising: making an invitation to purchase products at a specified price without disclosing the existence of any reasonable grounds the trader may have for believing that he will not be able to offer for supply, or to procure another trader to supply, those products or equivalent products at that price for a period that is, and in quantities that are, reasonable having regard to the product, the scale of advertising of the product and the price offered.
  • In the case of special offers: falsely stating that a product will only be available for a very limited time, or that it will only be available on particular terms for a very limited time, in order to elicit an immediate decision and deprive consumers of sufficient opportunity or time to make an informed choice.
  • In the case of competition or prize promotion: claiming in a commercial practice to offer a competition or prize promotion without awarding the prizes described or a reasonable equivalent.
  • In the case of free products: describing a product as ‘gratis’, ‘free’, ‘without charge’ or similar if the consumer has to pay anything other than the unavoidable cost of responding to the commercial practice and collecting or paying for delivery of the item.
  • In the case of prize competitions: creating the false impression that the consumer has already won, will win, or will on doing a particular act win, a prize or other equivalent benefit, when in fact either there is no prize or other equivalent benefit, or taking any action in relation to claiming the prize or other equivalent benefit is subject to the consumer paying money or incurring a cost.

In respect to prize competitions as well, the Gambling Act lays down that it is unlawful to conduct:

  • any competition in which prizes are offered for forecasts of the result either:
  • of a future event; or
  • of a past event the result of which is not yet ascertained, or not yet generally known;
  • any other competition in which success does not depend to a substantial degree on the exercise of skill.

The Tobacco Advertising and Promotion Act prohibits the free distribution of tobacco. A person is guilty of an offence if, with the purpose or effect to promote a tobacco product, in the course of a business he:

  • gives any product or coupon away to the public in the United Kingdom, or
  • causes or permits that to happen.

The UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing of the Committees of Advertising Practice (CAP Code) regulates sales promotion in Section 8. It establishes, inter alia, that:

  • Promoters must not encourage the consumer to make a purchase or series of purchases as a precondition to applying for promotional items if the number of those items is limited, unless the limitation is made sufficiently clear at each stage for the consumer accurately to assess whether participation is worthwhile.
  • Promoters must award the prizes as described in their marketing communications or reasonable equivalents, normally within 30 days.
  • All marketing communications or other material referring to sales promotions must communicate all applicable significant conditions or information where the omission of such conditions or information is likely to mislead. Significant conditions or information may, depending on the circumstances, include:
  • How to participate: including significant conditions and costs, and other major factors.
  • Free-entry route explanation: explained clearly and prominently.
  • Start date: if applicable.
  • Closing date: prominent closing date, if applicable.
  • Proof of purchase: any proof of purchase requirements.
  • Prizes and gifts: number and nature of prizes or gifts, if applicable.
  • Restrictions: geographical, personal or technological restrictions.
  • Availability: the availability of promotional packs if it is not obvious.
  • Promoter’s name and address.

Section 5 of the CAP Code lays down that promotions addressed to or targeted directly at children:

  • must make clear that adult permission is required if a prize or an incentive might cause conflict between a child’s desire and a parent’s, or other adult’s, authority.
  • must contain a prominent closing date if applicable.
  • must not exaggerate the value of a prize or the chances of winning it.

Promotions that require a purchase to participate and include a direct exhortation to make a purchase must not be addressed to or targeted at children.

Section 18 of the CAP Code stipulates that marketing communications that include a sales promotion must not imply, condone or encourage excessive consumption of alcohol.

Please visit:

  • The Consumer Protection from Unfair Trading Regulations 2008

https://webgate.ec.europa.eu/ucp/public/index.cfm?event=public.country.viewFile&lawID=23&languageID=EN

 

  • The Business Protection from Misleading Marketing Regulations 2008

https://webgate.ec.europa.eu/ucp/public/index.cfm?event=public.country.viewFile&lawID=24&languageID=EN

 

  • Consumer Protection Act 1987, as revised.

               http://www.legislation.gov.uk/ukpga/1987/43/contents

 

  • Gambling Act 2005

               http://www.legislation.gov.uk/ukpga/2005/19/pdfs/ukpga_20050019_en.pdf

 

  • Lotteries and Amusements Act 1976 (Northern Ireland)

               http://www.legislation.gov.uk/ukpga/1976/32/contents

 

  • Tobacco Advertising and Promotion Act 2002

               http://www.legislation.gov.uk/ukpga/2002/36/contents

 

  • UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code)

https://www.cap.org.uk/Advertising-Codes/~/media/Files/CAP/Codes%20CAP%20pdf/The%20CAP%20Code.ashx