Who: French legislators
Where: Paris
When: 20 December 2014
Law stated as at: 1st July 2015
What happened:
French rules regarding promotional contests have been modified during 2014 by two successive acts.
The Act n°2014-344 of March 17, 2014 first modified both rules contained in the National Security Code and the Consumer Code.
In respect to the Consumer Code, which regulates promotional prize draws, the Act authorized the payment by consumers of communication or connection fees, as long as they were informed of the possibility to be reimbursed of such fees. Such possibility had to be specified in the prize draw rules.
Prize draws for which participation was subject to a purchase obligation remained authorized if not having an unfair nature, and the rules of the prize had to be filed with a bailiff.
Despite these amendments, the French rules still did not comply with Directive 2005/29 on business to consumer unfair commercial practices, given that promotional operations, requiring a financial contribution, are not deemed unfair per se under this Directive, and so cannot be generally prohibited by national legislation.
The next piece of legislation, the December 20, 2014 Act modified again the promotional prize draw regulations, this time to conform to the EU Directive and Rulings of the European Court of Justice.
The former provisions have been repealed, and the law now expressly states that promotional prize draws are lawful if not unfair. The directive and the French consumer code establish 31 “black” practices, presumed unfair in any circumstances. For all other practices, unfairness will be assessed on a case by case basis by the Courts. Moreover, filing of the operation rules with a bailiff is no longer an obligation.
The new Act did not change the rules of the National Security Code, which had also been amended by the March 17, 2014 Act. Thus, article L322-2-1 of this code states that all affected promotions must be 100% free, meaning that it is not possible to make it a condition of entry into the game that there must be a purchase or a fee payment.
These provisions apply to all promotions whose prize attribution is due, even partially, to chance, as well as games based on the players’ skills.
Why this matters:
The question then arises as to what rules apply to promotional contests, as the Consumer Code only covers promotional prize draws, and as the National Security Code applies on the contrary to games based on players skills. Are promotional charged contests to be forbidden in respect of the National Security Code?
It has in fact never been the intent of the legislator to ban pay to enter promotional contests by adopting aforementioned article L322-2-1 of the National Security Code. Moreover, this prohibition would be non-compliant with Directive 2005/29 on business to consumers unfair commercial practices, which the December 20, 2014 Act precisely intended to assure.
In fact, it appears that promotional contests are not to be regulated, either by the promotional prize draw rules of the Consumer Code or by the prize draw rules of the National Security Code. They would only remain subject to general rules regarding commercial practices, which must not, in any case, be unfair to consumers.
