The Business Protection from Misleading Marketing Regulations 2008 ('Business Protection Regulations' or BPRs) ban misleading advertising. They also set out the rules on comparative advertising which web advertisers, direct marketeers and sales promoters need to think about when doing business online.
The Business Protection Regulations transpose EU Directive 2006/114/EC on Misleading and Comparative Advertising into UK law. The directive prohibits businesses from advertising products in a way that misleads traders. It sets out conditions under which the law permit comparative advertising to consumers and businesses.
The BPRs have a consumer equivalent: the Consumer Protection from Unfair Trading Regulations 2008 (CPRs).
The Business Protection Regulations
These Regulations deal mainly with the potential misleading of traders, although there are rules on comparative advertising that can be targeted both at traders and consumers.
Part 1 of the Regulations prohibits misleading advertising and also lays down strict guidelines for comparative advertising. It also ensures misleading advertising is not promoted by any code owner (namely a body responsible for a code of conduct).
Parts 2 and 3 deal with the criminal offences and defences, and the enforcement duty respectively.
- prohibit businesses from advertising products in a way that misleads traders;
- set out conditions under which the law permit comparative advertising to consumers and business.
If your business advertises goods or services to other businesses, or if in your advertisements to businesses or consumers you make comparisons that identify a competitor, or products offered by a competitor, the regulations are likely to apply to your business.
The Business Protection Regulations also apply to bodies which create and/or monitor business codes of conduct where the members of the code may engage in the above practices.
What is advertising?
Advertising means “any form of representation which anyone makes in connection with a trade, business, craft or profession to promote the supply or transfer of a product”. This includes face-to-face oral statements, tele-marketing and online marketing. The definition includes descriptions on accompanying goods (including claims on packaging) as well as general advertising.
Regulation 3 of the BPRs prohibit advertising that is misleading to traders. There are four main issues to take into account when deciding if the advertising is misleading:
- the product characteristics (13 in total, including availability, composition and specification)
- the price or manner in which the price is calculated
- the conditions on which the product is supplied or provided
- the nature, attributes and rights of the advertiser (five in total, including identity and assets)
Comparative advertising is advertising which identifies a competitor or competitor's product as a comparison against your own products or brand. Comparison advertising must meet the conditions set out in the regulations.
These conditions relate to aspects of the fairness of the comparison to a competitor or a competitor’s product which is made in the advertisement. If the comparison does not satisfy these conditions the law does not allow comparative advertising. This applies even if it does not mislead traders or consumers and alter their economic behaviour.
Regulation 4 states that comparative advertising is permitted only when all of the following conditions of the advertisement are met:
- it is not misleading under the BPRs or the CPRs
- it compares products that meet the same needs or are intended for the same purpose
- it objectively compares one or more material, relevant, verifiable and representative feature(s) of those products (may include price)
- it does not create confusion among traders, either between the advertiser and competitor, or between trade marks (or similar) of products of the advertiser and those of a competitor
- it does not discredit, denigrate or take unfair advantage of a competitor's trade mark (or similar)
- for products with designation of origin, it relates in each case to products with the same designation
- it does not take unfair advantage of the reputation of a trade mark (or similar) of a competitor or of the designation of origin of competing products
- it does not present products as imitations or replicas of products bearing a protected trade mark or trade name
Misleading Actions and Misleading Omissions
Regulation 5 states that a code owner is not permitted to promote (in a code of conduct) advertising that is misleading under the BPRs or comparative advertising that does not meet the listed conditions.
The CPRs prohibit 'misleading actions' and 'misleading omissions' that cause, or are likely to cause, the average consumer to take a different transactional decision - that is, any decision taken by the consumer concerning the purchasing of the product or whether to exercise a contractual right in relation to the product, including decisions not to act. This does not only relate to pre-shopping but includes after-sales and continues for the lifetime of the product.
Comparative advertising would be considered a misleading action (regulation 5 of the CPRs) if it either:
- contains false information or is likely to deceive the average consumer
- the marketing of the product creates confusion, or the trader fails to comply with a commitment in a relevant code of conduct
And if in both cases the consumer makes a transactional decision he would not have normally made.
Comparative advertising would be considered to be a misleading omission (regulation 6 of the CPRs) if:
- material information is omitted, hidden or unclear, and as such the consumer makes a transactional decision he would not have normally made
Supervision and enforcement
The BPRs contain criminal offences for a breach of regulation 3 (general misleading advertising). Prosecution can be taken by the Competition and Markets Authority, trading standards services, and the Lord Advocate in Scotland. The maximum penalty is a fine and two years' imprisonment.
Enforcers can also apply for a court order requiring you to comply. If the order is not complied with the maximum penalty is a fine and two years' imprisonment. This is also the only enforcement action that can be taken in respect of breaches of regulation 4 (comparative advertising not meeting the relevant requirements) and regulation 5 (promotion of misleading advertising by code owner).
The Business Protection from Misleading Marketing Regulations 2008 (text)