Prize draws and promotions are a popular choice for brands to engage with its consumers, particularly through online social media platforms.
As discussed in a previous blog post, the UK’s Advertising Standards Authority (ASA) has emphasised that prize draws must comply with provisions of its CAP Code. Failing which one risks being in breach of the rules, which can ultimately lead to criminal prosecution for failure to comply with consumer protection, gambling and advertising laws. Following an increase in consumer complaints that some prize draws are not being administered in accordance with the relevant rules, together with its influencer monitoring work, the ASA has recently released a dedicated resources and guidance page, which aims to help influencers and brands get their prize promotions right.
The resources page features videos and comprehensive advice, covering areas from marketing to dealing with unexpected events. Within the new guidance and in line with its previous rulings, the ASA has reiterated that action will be taken against those who fail to administer prize draws fairly.
One of the most practical resources shared by the ASA is a checklist (which can be found here). The checklist includes information on how a promotion or prize draw should be administered, the ways that organisers may want to prepare the related posts and content (for example, make the relevant terms and conditions easily accessible), how a winner is picked fairly (e.g. have an independent judge for competitions) and how an organiser can demonstrate to the ASA that a prize has been awarded correctly (it is a good idea to document the process). The ASA’s update is a useful reminder that signposting key conditions (such as the closing date) up front, in all promotional posts is crucial.
Following the ASA’s guidance will go a good way to achieving compliance with the overall legal framework within which such prize promotions sit. For example, ensuring that the mechanism is not a misleading commercial practice as prohibited by the Consumer Protection from Unfair Trading Regulations 2008 and avoiding the unlawful lottery offence under the Gambling Act 2005. Legal advice should always be obtained however.
It is clear that ASA will not tolerate failure to comply with the CAP Code in relation to promotions or prize draws. The introduction of this new guidance shows that the ASA is providing accessible advice to ensure that all influencers, brands and companies have practical guidance and helpful tools in order to avoid potential breaches of the CAP Code and sanctions imposed by the ASA.
Squire Patton Boggs specialises in advising on advertising and marketing law. For more information contact partner, Carlton Daniel and associate, Sera Kaplan.