Suddenly, after years of deliberation, the European Commission has come up with a brace of proposals for harmonising EU promo law, on the same day!
Topic: Promotion marketing
Who: The European Commission
After years of deliberation and prevarication, Brussels has published, on the same day, not one, but two sets of proposals to harmonise the EU’s patchwork quilt of sales promotion laws. The first is a draft regulation not a draft directive. Unlike directives, which give member states on average a year or two to bring the directive into force by their own separate legislation, regulations have direct effect across Europe on the day they stipulate. In this case, the suggestion is that the regulation is fast-tracked to be effective across Europe within months. One given reason for this almost indecent haste following so many years’ inaction is the impending January 2002 implementation date for the E-Commerce Directive.
A key aspect of the Regulation is disclosure. In an annex are various categories of information which must be provided by promoters, some applicable to all promotions (e.g. the duration of the offer including start and end date), others relating to particular types, such as discounts (e.g. having to state that the discounted price is below cost if this is the case), free gifts (e.g. the actual value of the free gift), and promotional games and contests (e.g. the actual or estimated odds of winning a prize).
Other highlights include an encouraging blanket ban on EU member states imposing various types of general restriction on sales promotions. For example, Italy and France will no longer be able to require that prior official authorisation is obtained before a prize promotion is conducted.
There are also various restrictions relating to promotions to children (defined as those under 14 years) including bans on collection of childrens’ data without verifiable prior consent of the child’s legal guardian (very similar to the current DMA on line promotion guidelines) and on free gifts capable of injuring a child.
A “Redress” section includes requirements that promoters respond to complaints in writing within 6 weeks and indicate any out of court dispute resolution system which they subscribe to.
Separately we have a rather more grandiose set of proposals from DG SANCO known as the draft “Green Paper on Consumer Protection.” Comments are invited by January 2002. The paper trots out the now standard gripes about sales promotion law disparities across the Union and the need to go beyond existing harmonisation laws such as the regulation proposed on the same day.
Then comment is invited particularly on how further harmonisation might best be achieved. The paper offers up two broad ways to go.
The first is a “specific approach” based on the adoption of further directives or a “mixed approach” of a comprehensive framework directive supplemented by targeted directives where necessary.
Clearly the paper prefers the latter, which would offer “general benchmarks” for fair commercial practice, enabling emerging marketing and promotional practices to be addressed without the need for specific further legislation. This would also provide a firm basis for EU wide self-regulation, for the development of “non-binding practical guidance” and for formal stakeholder participation in the regulatory process.
The self regulation would feature EU-wide; sector-specific codes of conduct, underpinned by clearly understood legal consequences for non compliance which the self regulation system had failed to police.
The “non-binding” practical guidance would be developed “in an environment of maximum transparency and consultation” and would be in user friendly language designed to help consumers, judges and enforcers alike.
The guidance would also be the vehicle for the flavour of the month “stakeholder participation”, whereby industry bodies would be encouraged to reach agreement on sector-specific parts of the guidance.
Why this matters:
Clearly something has had to be done with the current legal landscape, which renders pan European sales promotions virtually impossible to operate. It remains to be seen whether the seeds of the right solution are contained in this strange combination of a short, sharp, limited ambit Regulation and a Green Paper which hasn’t got the courage of its convictions to call itself anything but a “Draft” and is long on aspirational rhetoric and short on workable specifics.