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If you intend to run a competition or promotion as a marketing activity where a customer must purchase goods to be eligible to enter, then the promotion will be governed by the Gambling Act and your promotion will have to meet the requirements of a Sales Promotion Scheme. In addition, you must ensure that the promotion is not misleading or deceptive in terms of the Fair Trading Act. In particular, you should consider the following issues.
- Prizes should not differ in appearance from those shown in the promotion.
- Where the word "win" is used in relation to a promotion, the additional words such as "be in to win" or "you could win" should be used so that consumers are not misled into believing that everyone will win a prize.
- Where items are to be given away for free in a promotion, the price of the product should not increase during the promotion.
- Any "free" items to be given away should be available for the duration of the promotion.
- There must be consistency in the description of the prizes throughout the promotional material.
- Any representations made eg, "..for the best price in town" must be true.
- Any prizes supplied by you in a promotion will be subject to the 5 minimum statutory guarantees set out in the Consumer Guarantees Act 1993. These guarantees include the following:
- That the goods will be of acceptable quality. This means that the goods must be free from minor defects, acceptable in appearance and finish, fit for the purpose, safe and durable; and
- The goods will comply with their description.
- If you are not the manufacturer of the prizes then as a protection from liability under the Consumer Guarantees Act, you may wish to obtain an indemnity or guarantee from the actual manufacturer to repair or replace any goods offered as prizes which are faulty or defective.
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