Will looming “unfair practices ” regulations make it illegal to use the word “free” in “buy one, get one free” promotions? Nick Johnson reports for an inclusive charge on fear and loathing recently spread in Fitzrovia and the outcome.
Topic: Promotion marketing
Who: BERR, Institute of Sales Promotion
Where: United Kingdom
When: March 2008
Law stated as at: 30 March 2008
The Institute of Sales Promotion has backed down from claims that the new Consumer Protection from Unfair Trading Regulations 2008 will prohibit "buy one get one free" (BOGOF) offers.
The ISP had originally advised its members that, once the Regulations come into force in May, these promotional offers would have to be described as "two for the price of one" instead.
However, following assurances from the Department of Business Enterprise and Regulatory Reform and from the Committee of Advertising Practice (CAP), the ISP now advises that businesses should continue to use BOGOF offers for now, even though the Institute's line remains that, on a strict interpretation, these offers will be contrary to law.
Why this matters:
The ISP's concerns arise from the wording of one of the 31 practices that are listed in the legislation as being always unfair. Practice number 20 prohibits "describing a product as 'gratis', 'free', 'without charge' or similar if the consumer has to pay anything other than the unavoidable cost of responding to the commercial practice and collecting or paying for delivery of the item".
On the ISP's analysis, this would make BOGOFs illegal, on the basis that the consumer has to pay for one of the items in order to get the other one. Indeed, their view is that any kind of "gift with purchase" promotion where the gift is marketed as 'free' (or similar) would also be prohibited.
However BERR officials have confirmed that, so far as the UK government is concerned, this is not the intention of the legislation. The BERR's view is that the prohibition is intended to catch scams and misleading offers and that, with BOGOF offers, the cost of paying for one item is the "unavoidable cost of responding to the commercial practice". CAP have echoed this view, indicating that they do not intend to amend their existing, somewhat complex guidance on use of the word 'free'.
It is just possible that this may not be the end of the matter. The new legislation is required in order to give effect to the EU's Unfair Commercial Practices Directive. But apparently other EU member states are implementing the restrictions on 'free' in line with the ISP's analysis. So the possibility remains that the European Commission could be persuaded to take the UK to court over this. However, don't expect the position to change in the near future or without plenty of warning.