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OFT obtains undertakings from Belgian mail order company

137/07    26 September 2007

A mail order company based in Belgium has given undertakings to the OFT that it will not send misleading prize draw mailings to UK consumers.

Agence de Marketing Applique (AMA) distributed hundreds of thousands of prize draw mailings to UK consumers under the name 'Vital Beauty' together with a mail order catalogue offering healthcare and beauty products. The OFT believed that the mailings misled recipients into believing they had won a large cash prize of up to £14,500, when in fact they were only entitled to entry into a prize draw with a small chance of winning the cash prize. Nearly everyone who responded was sent a low value discount voucher for use against future orders. The OFT also considered that recipients were further misled into believing that they must place an order from the accompanying catalogue as a condition for claiming their prize, when actually it was possible to enter the prize draw without making any purchase whatsoever. Reference to this was only mentioned within a large amount of small print. The OFT received numerous complaints from consumers who had been misled by these mailings.

AMA has agreed not to publish advertisements that give the misleading impression that recipients have won a large cash prize, and that any future mailings will clearly distinguish between the main cash prize and the discount voucher prizes that all participants are entitled to receive. Each page of the mailing will also include the words 'free prize draw' and 'no purchase necessary'. If AMA breaches these undertakings, then the OFT can refer the company to its Belgian counterparts under the European Consumer Protection Cooperation Regulation and request that they consider taking action.

Mike Haley, Head of the OFT's Consumer Protection Group said:

'Consumers should not be misled into spending money by false claims that they have won a major cash prize. We will act to stop misleading prize draw mailings, whether they originate in the UK or elsewhere'.

Consumers who are unsure about claims being made in prize draw mailings should contact Consumer Direct for clear, practical advice on 08454 04 05 06 or visit the Consumer Direct website before they part with any money.

NOTES

1. AMA has a registered office of Europle Dreve, Gustave Fache 1, 7700 Mouscron, Belgium. AMA trades in the UK as 'Vital Beauty' and 'Swiss Home Shopping'.

2.  AMA signed the undertakings on 4 September 2007.

3.  The Control of Misleading Advertisements Regulations (CMARs) 1988 (as amended), largely implement EU Directives on misleading and comparative advertising. They aim to protect the interests of consumers and businesses from misleading advertisements and advertisements that make prohibited comparisons. An advertisement is misleading under the Regulations if in any way, including its presentation, it deceives or is likely to deceive the person to whom it is addressed or whom it reaches and if by reason of its deceptive nature, it is likely to affect their economic behaviour, or for those reasons injures or is likely to injure a competitor of the person whose interests the advertisement seeks to promote. 'Advertisement' for the purposes of the Regulations means any form of representation which is made in connection with a trade, business, craft or profession, in order to promote the supply or transfer of goods or services, immovable property, rights or obligations. The OFT can take action against anyone appearing to be concerned or likely to be concerned with the publication of a misleading advertisement. It can apply to the courts for an injunction ordering such persons to comply with the law in future. It may also accept undertakings from those involved in lieu of action.

4. The European Consumer Protection Co-operation Regulation (CPC) established a network of public enforcement agencies in every EU member state to facilitate effective cross-border co-operation on infringements of consumer law. The OFT is the UK's single liaison office, co-ordinating requests for action from EU authorities. The creation of similar offices around the EU allows enforcers to ask other authorities to take action within their own countries to stamp out infringements of EC consumer legislation.

5. Details of previous OFT's actions against misleading prize draw promotions can be found in press releases 100/07, 160/06, 125/06, 105/06, 41/06, 34/05, 220/05, 95/05.

6.  Consumer Direct is a telephone and online consumer advice service funded by government and managed by the Office of Fair Trading. It offers clear, practical and impartial advice and information about consumer rights.

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