Before our 14 August event, we canvassed the views of the delegates on UK and EU sales promotion law reform.
Topic: Games of chance and skill
Who: Osborne Clarke, the Promotion Marketing Association and delegates to the Prize Promotion Law Forum on 14 August 2002
When: August 2002
Shortly before the 14 August 2002 'Prize Promotion Law Forum' held by Osborne Clarke and the Promotion Marketing Association, all delegates due to attend were polled by email on a number of questions. The response was good and the answers received give pause for thought.
The first question asked delegates their views on the current UK legal regime controlling prize promotions. Just 5% felt that current rules were 'not that complicated and still serving a useful purpose.' 14% agreed that they were 'ignored, unenforced and best kept that way', 19% felt they were over complex and no longer needed to protect consumers, whilst a significant 57% felt that they were 'in need of a few minor changes but nothing radical'.
On the question of who should regulate prize promotions under any new regime, only 4% felt the Gaming Board would be the appropriate body, 14% plumped for the Office of Fair Trading, 26% opted for self regulation, whilst the largest proportion, 30%, favoured the Budd report's proposed new regulatory body, the Gambling Commission.
On the proposed new EU Sales Promotion Regulation, seeking to harmonise member states' laws affecting various types of promotion, 14% felt this would only mean more Brussels controls and bureaucracy, a significant 38% felt it would 'make no real difference because of cultural differences and logistical challenges', while the largest number, 43%, felt this would see a substantial increase in pan-European prize promotions.
Delegates were also asked what single change they would like to see coming out of this whole process. The most common response indicated a desire to see the legalisation of genuine, no extra cost prize promotions tied to the purchase of a product. Considerable numbers of respondents also wanted to see the legitimisation, rather than the banning, of premium rate telephone prize promotions, whilst a clear separation of prize promotions from general betting and gaming laws was also a strong desire.
Why this matters:
The community being polled here is obviously an industry one rather than one of consumers, but it is still interesting that nearly 60% of respondents saw no need for anything other than minor changes to current UK prize promotion law. No vote for root and branch reform here! As for the ideal regulator, there is clearly a need for simplification in this area, but given the strong desire amongst delegates for prize promotions to be taken out of the gambling regime altogether, it is a moot point as to whether the proposed new 'Gambling Commission' would be the right entity to take control.
As for the proposed EU Sales Promotion Regulation, that nearly 40% felt harmonised EU rules would make no real difference to them is hardly a massive fillip for the European Commission and our own DTI in their push for greater homogeneity in this area across the Union.
Maybe it is only the big brands and big agencies who will benefit from these time-consuming, grand initiatives, with SMEs across Europe continuing with the existing practice of running localised, tactical prize promotions.
So far as the single biggest desired change is concerned, marketinglaw endorses the view that genuine, purchase-related pure luck promotions should be legalised, as in countries such as New Zealand. On the other hand, this is a classic form of lottery, which at present only the National Lottery has a special exemption to operate on a commercial basis. Will the vested interests involved be prepared to see a significant widening of this exemption?