It seems now you need to keep up to date with European Court of Justice cases if you want to avoid breaching the CAP Code. Certainly that’s how it looks in a recent ASA adjudication on comparative claims made by Asda. Nick Johnson investigates the ASA’s new-found interest in the law.
Who: Advertising Standards Authority, Asda, Morrisons
When: 14 January 2009
Law stated as at: 28 January 2009
It seems now you need to keep up to date with European Court of Justice cases if you want to avoid breaching the CAP Code.
Following a complaint by rival Morrisons about price comparison advertising run on TV and in national press by supermarket Asda, the ASA investigated whether Asda had complied with the relevant CAP Code requirements.
In its adjudication, the specific complaints raised by Morrisons were not upheld:
7. Morrisons argued that "checked independently by sources including mySupermarket.co.uk" implied that Morrisons prices could be found on the mySupermarket.co.uk website. The ASA disagreed.
8. Morrisons also argued that Asda should have given details in the ad as to which branches had been checked for product prices. However, as both Asda and Morrisons operated national pricing strategies, the ASA ruled that store locations were irrelevant.
9. Morrisons also queried whether the 5880 products selected for inclusion in the price comparison exercise represented a fair selection. Because the comparison covered all the same brand and same size products stocked by both supermarkets, and because the ads made clear that they only compared same brand products, the ASA concluded the comparison was based on a fair selection.
However, the ASA also added its own challenge, as to whether the price claims made in the ads could be verified by consumers.
Verifiability of comparisons under the codes
The CAP Code requires that comparative claims should "objectively compare one or more material, relevant, verifiable and representative features of those products" (Code clause 18.3). The BCAP TV Advertising Standards Code has no such express provision, but does reference the verifiability requirement as a legal requirement under the Business Protection from Misleading Marketing Regulations 2008 in the notes against Code clause 5.4.6.
But there is no guidance in either Code as to what "verifiable" means in this context.
Asda understandably pointed out:
- that the CAP and BCAP Codes did not require them to make available to consumers a list of the products and prices used in the comparison;
- that consumers could in any event verify the comparisons by visiting any Morrisons store;
- that the truthfulness of the comparison would not affected by whether consumers could verify it; and
- that there was no benefit to consumers in being able to check the comparisons, given the degree of scrutiny that they would come under from Asda's competitors.
However, the ASA pointed to the 2006 European Court of Justice judgment in the case Lidl v Colruyt (as reported on at http//www.marketinglaw.co.uk/articles/2007/7939.asp). This lays down certain requirements that comparative advertisers need to meet in order to satisfy the verifiability criterion under the Comparative Advertising Directive.
The ASA summarised these as meaning that, for a general price comparison to be verifiable, the advertiser would need to "set out how the details used to make that comparison may be checked by the persons to whom the ad was addressed" (a reasonably accurate summary, although it skips the important word "readily" and a potentially important proviso as to third party verification).
The ASA held that, because both the CAP Code and the BCAP Code require ads to comply with the law, price comparisons of this nature would need to comply with the verifiability criteria defined in the Lidl case in order to avoid an "upheld" ASA adjudication. In the ASA's view, Asda had not done so and should have "given details of how consumers and competitors could verify the products and prices used to make [the] comparison for themselves, for example by including a link to a website or a postal address".
Why this matters:
It's unusual to see the ASA citing case law in its adjudications. Indeed, this seems to run somewhat counter to the ethos of the self-regulatory body, which generally goes to considerable lengths to position itself as operating a user-friendly system where legal expertise is not required.
However, if the ASA is to maintain its position as one of the "established means" for achieving enforcement of the Consumer Protection from Unfair Trading Regulations 2008 and the Business Protection from Misleading Marketing Regulations 2008 other than through the court system, then paradoxically it needs to keep on top of any case law that's relevant to the interpretation of that legislation.
All of which raises the question as to how far the ASA may be prepared to go in enforcing the CAP Code requirement that "marketing communications should comply with the law". For instance, will we now see copyright owners filing complaints with the ASA as a cheaper alternative to bringing infringement proceedings against advertisers through the courts? With the burden of proof squarely on the advertiser to prove compliance, this may be an attractive alternative for a claimant who is not bothered about financial compensation…