Who: Advertising Standards Authority, SeaMaple (HK) Ltd, Kitchen Factory Ltd and UK-battery-shop.co.uk
Where: United Kingdom
When: August 2013
Law stated as at: 8 October 2013
It has been a busy time for the Advertising Standards Authority (the “ASA”) where the regulation of online advertising is concerned. August 2013 saw the ASA adjudicate on a number of online ads which all had a geographical flavour to them including complaints against the following international companies:
SeaMaple (HK) Ltd t/a Urdress.co.uk
Claims on www.urdress.co.uk (the advertiser’s own website) stated “URDRESS.CO.UK is a UK based retailer offering exciting beautifully designed, excellent quality fashion and accessories for women and children … Urdress belongs to EdressesGlobal UK Co. Ltd …”.
The website included a number of listings which featured a photograph of a dress as well as a price. Further claims on the FAQs page of the website stated
“… 13. Is there a charge for sales tax? There is no charge for sales tax on all orders … 15. What’s the price shown on your website? The price on our website is just retail price, does not include the delivery cost. You can view our delivery page to know more information about delivery cost.”.
The ASA received a complaint from a consumer resident in Ireland that the claim “URDRESS is a UK based retailer” was misleading and could not be substantiated and that the website was also misleading because it failed to make clear that consumers would be held liable for customs charges/import fees for a delivery from Hong Kong to Ireland. The ASA upheld both elements of the complaint on the basis that:
1. the claim “URDRESS.CO.UK is a UK based retailer” was misleading as it incorrectly implied that they had a presence in the UK such as through having retail premises or business offices in the UK and SeaMaple could not substantiate this as: (a) in pricing claims their website stated that they had no overheads as physical stores in the UK did; (b) the complainant’s order had been shipped from Hong Kong; and (c) the only address listed on the website to allow consumers to write to them was a Hong Kong address;
2. as the complainant lived in Ireland and her dress had been shipped from Hong Kong leading the complainant to be required to pay customs charges to receive her order, delivery information provided by the website was misleading. The website made clear that a delivery charge of £15 was automatically applied to all orders save for those over £150 which benefited from free delivery but there were no references to customs charges potentially being applicable. The ASA held that it should have been clear that custom charges might apply and that potential cost was excluded from the purchase prices illustrated on the website; and
Kitchen Factory Ltd
Three websites referred to the same kitchen supplier in different ways: (a) www.the-kitchenfactory.co.uk stated “© 2010 Really Cheap Kitchens”; (b) www.kitchendesign1.co.uk stated “Kitchen Design – Part of the Kitchen Factory Group” and “© 2013 Kitchen Design”; and (c) www.uk-fittedkitchen.co.uk stated “UK-Fitted Kitchen – Operated By The Kitchen Factory” and “Copyright © uk-fittedkitchen.co.uk”.
The ASA received a complaint that these sites were misleading because they did not state the geographical address of the marketer concerned. The ASA noted that the CAP Code required marketing communications not to mislead consumers by omitting material information, which included, where prices were quoted for advertised products, the identity and geographical address of the marketer.
Because the websites quoted prices for various kitchens but did not make clear the geographical address of the marketer, it was therefore held that the ads were misleading and in breach of the CAP Code.
The website www.uk-battery-shop.co.uk listed prices for its products in pounds sterling and its homepage featured a box headed “Shipping Method” which included the Royal Mail logo and text which stated “All orders are shipped by Royal Mail unless otherwise stated”.
The website stated that all queries could be answered online or by a specialist team of UK based advisors. The complainant challenged whether the website was misleading because it gave the impression that the advertiser was based in the UK when he understood they were actually based in China.
The ASA held that there was a lack of any information that the company was based in China and in addition to that, various aspects of the website (including its references to the Royal Mail, to “UK based advisors”, pounds sterling and the website URL” www.UK-battery-shop.co.uk”), all implied that the company was a UK-based company. As the company was in fact based in China, the ASA concluded that the ad breached the CAP Code.
Why this matters:
Assuming that online advertising materials fall within the ASA’s remit and are not considered “marketing communications in foreign media” to which the CAP Code does not apply, these recent adjudications act as a reminder that stating the geographical location of a marketer can be important for CAP Code compliance.
If a marketer is not based in the UK then their websites should not misleadingly imply (or state) that they are. Rule 3.4.2 of the CAP Code also requires that ads quoting prices need to state the identity and geographical address of the marketer concerned.
If a marketer’s geographical location means that additional taxes or delivery charges are likely to be incurred when a product is purchased, then this needs to be stated upfront (or at least the method of calculation for applicable charges if they are not set to a fixed sum).
If such information is not provided, or it is hidden or provided in a misleading or confusing manner, then not only is the marketing communication likely to breach the CAP Code but also the Consumer Protection from Unfair Commercial Practices Regulations 2008.