Newsletter from the Danish Consumer Ombudsman

15. January 2007

Section 9 of the Marketing Practices Act on sales promotions and special offers took effect 1 January 2007. See more about the consequences of this effectuation below.

In December 2006 the Consumer Ombudsman negotiated with major Danish telephone companies to block access to adult content delivered through text and multimedia message services. See more below.

New Danish Rules Open up for the Use of Sales Promotions

While most people associate sales promotions with gifts, it does in fact cover a range of sales-boosting initiatives: discounts, participation in competitions, winter sales and the like. All these sales initiatives are now regulated under section 9 of the Marketing Practices Act.

According to section 9, businesses and traders must now make sure to

  • state other terms that may apply to the offer;
  • state these other terms in a clear and easily accessible manner;
  • state the market value in the event that it is a gift that is the promotion; and
  • state in a clear manner if any provisos apply – e.g. in the event of limited supply, that it is a special offer or if the trader anticipates a situation in which he or she will not be able to satisfy the demand in a quantity that is reasonable in relation to the offer. 

Henrik Øe, the Danish Consumer Ombudsman, said:

‘The information duty set out in section 9 ensures that terms surrounding the promotion remain transparent and easy to understand for the consumer. The offer must be presented in a fair and loyal manner. The consumer must be able to evaluate the pros and cons of the offer - is it a good bargain or are there too many things to take into consideration? However, businesses and traders may also benefit from the liberalization of this area.’

Violations of section 9 are punishable.

1 January 2007 also saw the repeal of the bans on sales promotions and quantity restrictions.

See the abridged version of the guidance paper on sales promotions

Danish Consumer Ombudsman Halts Delivery of Adult Content to Children’s Mobiles

A consumer information programme televised in November showed just how easily young people below 16 could get their hands on erotic and sexual text and multimedia messages even as this was clearly a violation of the telephone companies’ own guidelines on the area. It prompted the Consumer Ombudsman to convene a meeting of representatives from the business to debate the problem.

Henrik Øe, the Danish Consumer Ombudsman, said:

‘The telephone companies must comply with the principles on good marketing practices; hence they should take neither direct nor indirect part in marketing adult content services to children. As a consequence of having agreed to the undertaking, the telephone companies must from now on monitor external content providers operating through their network. Further, they must block access to their network for content providers who market adult services. I am very pleased with this arrangement. In general, businesses must be very cautious when marketing services and the like to children and young people’.

Henrik Øe emphasizes that he will also keep the content providers under close watch.

Background

The telephone companies have established their own framework agreement on mobile content services. Pursuant to this agreement, services with specific short code numbers which are also available to children must not contain descriptions of adult material. The undertaking also lays it on the companies to maintain the part of the framework agreement on adult content services and other consumer protection rules.

Moreover, the telephone companies have pledged to establish an independent control unit to ensure that message services containing adult content are not marketed to children below 16. The control unit must be independent of economic interests and the day-to-day running of the companies. Its envisaged task will be to screen 10 per cent of all content services offered, amounting to approximately 500 services on an annual basis. The investigation should cover a representative sample of all content service providers in the market. The control unit should be in operation by 1 February at the latest to work on a trial basis for one year until further notice.

The conditions set out in the undertaking oblige the telephone companies to block the access to the contents offered by the service provider in the event that there are external providers who fail to observe the framework agreement by for instance offering services with adult content. According to the undertaking, the telephone companies must block the access to the network until the content provider has ceased to engage in this activity. In the event of recurrent violations, a quarantine of one month may be invoked.

The telephone companies as well as the control unit must report on the steps taken on a quarterly basis.

Pursuant to the Marketing Practices Act, an undertaking is a binding commitment to cease the performance of a specific marketing activity. In the event that the business or trader violates the undertaking, the Consumer Ombudsman may issue an enforcement notice to ensure that the undertaking is observed cf. section 23(2) of the Marketing Practices Act. If the enforcement notice is disregarded, the company may be penalised by fine, cf. section 30(1) of the above Act.

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