Sales promotion letters to MEPs
Brussels B -1047
1st Reading Vote on Sales Promotion Regulation
3rd September 2002
The European Publishers’ Council (EPC) is a high level group of Chairmen and CEOs of leading European media corporations actively involved in multimedia markets spanning newspaper, magazine, Internet and on-line database publishing; many EPC members also have significant interests in private television and radio. A list of our members is attached.
Before the vote on 3rd September in Strasbourg we would like to bring to your attention four amendments which have been approved in Ward Beysen’s draft report which we feel would pose significant problems for Europe’s publishing industry.
In previous submissions to the Parliament we have put on record our general support for the Regulation on Sales Promotion which we believe will simplify legislation across Europe and remove barriers to cross-border trade which
publishers clearly support.
1. Limitation on the value of a sales promotion:
Amendment 29 (formerly 114, 115, 116) which provides that:
"Member States or non-regulatory bodies shall not impose a limit on the value of a sales promotion provided that it is consistent with the value of the goods and services covered by the promotion".
We oppose any limits being placed on the value of a Sales Promotion.This amendment could become a way of limiting the value of a prize 'through the back door'. In the many newspaper promotions used by our members, for example a prize to win a €300,000 holiday home might be held not to be "consistent" with the value of a newspaper. It appears that this could allow national authorities to place the sort of limitations on prize values that we have successfully argued against so far. We urge you to vote against this amendment which has previously been rejected by the legal affairs committee.
2. Likely chance of winning a prize:
Amendment 57, 61 (formerly 228 and 229) amending Annex 4.1 indent 7 apparently provides that in the case of a promotional game,
"the promoter shall provide sufficient information for any participant in the promotion to understand the likely chance of winning".
We agree that consumers should be well informed but we are concerned that this particular wording, and theoriginal text proposed by the Commission, could lead to the imposition by national authorities of a requirement to provide an unnecessary amount of information, or worse meaningless information about the odds of winning, which would not enhance a consumer’s ability to decide to participate or not. Often it is not possible to give accurate chances of winning, as this depends on the number of participants. In addition, skill as well as chance may affect the odds of winning which are not predictable in advance by a promoter. Too much mandatory information included in the text of a sales promotion can limit its effectiveness. Instead this information should be available on request to any interested consumer. In the UK for instance the British Sales Promotion Code (Clause 40.14) merely provides that "Promoters should not mislead consumers about the likelihood of winning a prize". We think this is fair and sufficient and more meaningful.
3: Cash Prizes
Amendment 58 (formerly 235) proposes a deletion of the requirement that information must be made available, including whether a cash alternative can be substituted for any prize. This seems to be rather confusing as nowhere else in the draft Regulation, or other amendments to the draft Regulation is there a mention of a limitation on cash payment in the course of a sales promotion. We suggest that this is re-worded to make it clear that cash payments are not to be prohibited.
4. Competitions of skill
Amendment 20(formerly 68)is intended to prevent sales promotions from becoming a disguise for gambling activities. Although we support this aim, we fear that this amendment could be interpreted too widely to prevent certain types of competition and games (e.g. Fantasy Football) if a profit of a purely incidental nature were to be made from a promotion. As Member States already have national legislation for the purpose of controlling of prohibiting gambling activities, we suggest this amendmentshould be rejected.
We hope you will take these points into account in the vote. It is important that the text does not have the unintended effect of limiting the creativity of the European media industry to promote it’s publications and online services. Newspaper and magazine publishers use a variety of bona fide sales promotion techniques, according to existing laws and self-regulatory codes of practice, as a way of attracting new readers and maintaining existing readership in a steadily declining market.These promotions, including competitions, prizes, free gifts, special offers and loyalty schemes are very popular with our readers and help to promote as wide a distribution of the printed press as possible.
Please contact me if you need any further information on the issues raised in this letter.
Angela C Mills