Following our October 2001 report of new laws liberalising and harmonising European promotion marketing laws.
Topic: Promotions marketing
Who: The European Commission
When: July 2002
In October 2001 we reported on marketinglaw.co.uk the publication of a proposed EU Regulation on sales promotion. The initiative was the outcome of many years of deliberation on the part of an "Experts’ group" of officials of all EU member states looking at the need to harmonise legal controls across Europe affecting promotion marketing activity. As an indication of the importance the European Commission attached to this new initiative, the proposals of last October were in the form of a suggested "Regulation" as opposed to a "Directive". The difference between a Regulation and a Directive is that the former has direct legal effect in each EU member state on the appointed date, whilst the normal procedure for a Directive is that separate implementing laws have to be introduced in each EU member state to give the Directive legal effect. On 2 July 2002 the Legal Affairs Committee of the European Parliament voted on the "first reading report" of the proposed Regulation. Some amendments were made to the draft, but broadly the opinion of the Committee was favourable and we move to the next stage of the EU law-making process. This is a vote by the full European Parliament on the Regulation in mid-September 2002. With a fair wind, the Regulation could be finalised, signed off and have the force of law across the European Union by late 2002 or early 2003.
Why this matters:
For the most part, this Regulation is a liberalising rather than a restricting measure. Under its terms, arcane requirements such as those in France and Italy requiring prize promotions to be registered with a central body in advance of the running of the event, will be unsustainable. Also certain standards for prize events, such as a uniform blanket requirement to give the odds of winning, are to be introduced.
In other areas, however, the Committee voted through amendments which will reduce the harmonising impact of the Regulation. For instance, sales of items below cost were to be completely de-restricted, but fierce opposition from some member states has led to this being dropped out of the Regulation altogether. This means that member states will still be free to decide whether to ban sales at below the retailer's actual cost. An attempt to sweep away member state restrictions on discounts prior to seasonal sales has also failed, while a prohibition on promoters providing free gifts or premiums to children under 16 has now been amended so that the ban applies to under 14s instead. Another amendment here is that the requirement of "verifiable prior consent" when processing data relating to a child has now lost the word "prior" so merely "verifiable consent" will be needed. A related amendment allowing marketers to contact a child in order to gain their parent's contact details so that they can get parental consent was also approved.