Ads & Brands Law Digest: January 2024

Advertising and marketing

Enforcement Notice issued to non-UK based cosmetic surgery providers

The Committee for Advertising Practice has issued an Enforcement Notice to cosmetic surgery providers based abroad. It highlights the rules in the CAP Code which are designed to protect people, in particular young and other vulnerable audiences, from potential harm.

Over the last few years, more people have been looking to get procedures such as liposuction, breast augmentation and “Brazilian butt lifts” carried out outside the UK. CAP has seen an increase in ads targeting UK consumers for these services and, while some are following the rules, many are not.

This action follows on from ASA investigations which have led to thirteen ads targeting people in the UK from foreign-based cosmetic surgery clinics being banned. CAP will also be using enhanced monitoring to find problematic ads.

For more information, see here.

Regulatory 

Government responds to consultation on improving consumer price transparency and product information for consumers

The Department for Business and Trade has published its response to its consultation on improving consumer price transparency and product information for consumers.

It will be making changes to the rules on unit pricing, including to accommodate deposit return schemes, and ban “mandatory” drip pricing (although it will continue to monitor the situation with regard to optional fees).

In addition, it will be a banned practice to:

• commission or incentivise any person to write and/or submit a fake consumer review of goods or services,
• host consumer reviews without taking reasonable and proportionate steps to check they are genuine,
• offer or advertise to submit, commission or facilitate fake reviews.

These will be dealt with as amendments to the Digital Markets, Competition and Consumers Bill.

For more information, see here and here.

The CMA has begun a review of loyalty pricing by supermarkets.

With the rise in some supermarkets making cheaper prices only available for loyalty card members, the CMA announced that it would begin a review of loyalty pricing by supermarkets in January 2024. It has now started that review, which is part of a programme of work by the CMA to help tackle cost of living pressures in the groceries sector.

The review will consider issues such as:

• whether any aspects of loyalty pricing could mislead shoppers, for example whether the loyalty price is a genuine promotion or as good a deal as presented;
• whether any groups of shoppers are disadvantaged by this type of promotional activity;
• whether loyalty pricing is affecting consumer behaviour, and whether this has an impact on how supermarkets compete with each other.

The review is at an early stage and the CMA has not formed any views on the issues. It is now beginning its engagement with supermarkets. It will publish an update on its work in July 2024, and expect to complete its review by the end of the year.

For more information, see here.

CMA publishes results of unit pricing study

The CMA has also published the results of its unit price study, which it carried out as part of its review of grocery pricing.

Its consumer research showed that some shoppers already find unit pricing helpful. Importantly it highlights that there is scope for more shoppers to use unit pricing, and more regularly. The research highlights the types of purchases where shoppers find it can be most useful.

Its pricing analysis highlights the value of unit pricing when comparing between grocery items - revealing that shoppers’ commonly held assumptions about what products are cheapest on a per unit basis aren’t always right and that the pricing of some products relative to others can be surprising.

This will feed into the government’s review of the Price Marking Order.

For more information, see here.

ICO issues further warning to organisations to make advertising cookies compliant

In a follow up to warning letters sent in November 2023 to operators of some of the UK's most popular websites, the Information Commissioner's Office has published an update about the response from the organisations involved, and next steps towards tackling websites with non- compliant cookie banners.

The ICO says that it expects all websites using advertising cookies or similar technologies to give people a fair choice over whether they consent to the use of such technologies. To help achieve that goal, the ICO will be developing an AI driven solution to help identify websites using non-compliant cookie banners and will run a "hackathon" event early in 2024 to explore how this AI solution might be adopted in practice.

For more information, see here.

Government confirms smokefree generation and youth vaping plans

The UK government has confirmed its intention to bring forward a Tobacco and Vapes Bill as soon as possible.

Secondary legislation under the Bill will restrict the flavours, point of sale display and packaging of nicotine vaping products. There will be further consultation on these restrictions.

For non-nicotine vapes and other consumer nicotine products, such as nicotine pouches, the same flavouring, point of sale and packaging restrictions will apply as for nicotine vapes. In addition, the government will impose restrictions on selling non-nicotine vapes and other nicotine products to under-18s, a ban on someone else buying them for an under-18, and a ban on their free distribution (for example, as samples).

For disposable vapes, the UK, Scottish and Welsh governments plan to introduce a ban on their sale and supply, whether they contain nicotine or not, for environmental reasons. These governments will also work together to explore an import ban on disposable vapes. There will be at least a six-month implementation period for any ban.

The UK government also thinks there is a strong case to take action to reduce the affordability of vapes and is considering options, including a new duty, to achieve this.

The response confirms that the government will change the age of sale for all tobacco products, cigarette papers and herbal smoking products so that anyone born on or after 1 January 2009 will never legally be sold tobacco products.

In terms of enforcement, the government will introduce a £100 fixed penalty notice (FPN) for the underage sale, proxy purchase and free distribution of tobacco products, vapes (nicotine and non-nicotine) and regulate to extend these provisions to other consumer nicotine products. This FPN will apply in England and Wales as Scotland and Northern Ireland already have FPNs for underage tobacco and vape sales.

For more information, see here.

High Court overturns IPO Decision invalidating Oatly’s POST MILK GENERATION trade mark

This month we include brief summaries of two cases in which branding for alternatives to meat and dairy foodstuffs has received mixed reactions from the IP Offices and courts in the UK and EU.

Regular readers of this Digest will recall that Oatly have previously won a notable victory in the EU courts, which found that their slogan “It’s like milk but made for humans” was sufficiently distinctive to render it registrable for their oat-based milk substitutes. More recently Oatly have been seeking to defend their registration of the phrase POST MILK GENERATION in the United Kingdom (in classes relating to T-shirts, and oat-based drinks, creams and sauces). The mark had initially been registered in 2020 on the basis that it was suitably distinctive, etc, but in response to objections lodged by Dairy UK (“the voice of the UK dairy industry”) it was subsequently declared invalid. The Hearing Officer at the UK Intellectual Property Office (IPO) rejected suggestions that the mark was likely to deceive the public, but did come to agree with Dairy UK that regulations on agricultural products require that the term “milk” can only be used for marketing purposes in relation to milk or milk products (i.e. “mammary secretions”). As section 3(4) of the Trade Marks Act prevents a mark from being registered if “its use is prohibited… by any enactment or rule of law”, this was found to render Oatly’s mark invalid (except in respect of T-shirts, as they were not an agricultural product).

Oatly appealed against the IPO Hearing Officer’s ruling. In the High Court the judge analysed the legislative background to and purpose of the relevant agricultural regulations, and concluded that they were concerned to ensure that the “designations” used to describe products are clear, i.e. to ensure that “only those products that truly are dairy products are marketed and sold as such.” But crucially the judge concluded that by “designations” is meant the actual names or descriptors of the products themselves, not more general marketing language. Thus Oatly would have fallen foul of the regulations if it had called its product “oat milk”, but by contrast use of the phrase “Post Milk Generation” in its marketing was not using the word milk as a “designation” of the product. Moreover, average consumers would understand that the mark was referring to people “who no longer consume dairy milk”, and thus there was no suggestion that Oatly would be seen as claiming that its products were dairy products. The judge therefore found in Oatly’s favour, confirming that its mark is valid in all of the classes originally registered.

For more information, see here.

EU General Court rules MYBACON mark deceptive in respect of fungi-based meat substitutes

In the case discussed above, the IPO Hearing Officer had decided that Oatly’s mark was not deceptive in the sense of leading consumers to think that they were actually purchasing a dairy product – that it contained the phrase “post milk” was surely sufficient to flag this up. By contrast, when Myforest Foods Co attempted to register an EU trade mark MYBACON for their fungi-based meat products they were less successful: their application was rejected at the EU Intellectual Property Office at both examination and Board of Appeal levels, and that rejection has now been confirmed on further appeal to the EU General Court. At each level, the mark was rejected under Article 7(1)(g) of the EU Trade Mark Regulation on the basis that it would be of such a nature as to deceive the public as to the nature or quality of the product (i.e. making consumers think it was animal-based bacon rather than a fungi-based substitute).

In rejecting the appeal by Myforest, the General Court has usefully clarified a number of points that may be relevant to other businesses seeking marks for their meat-alternative or dairy-alternative products. First, it rejected arguments that the typical consumers of meat-alternative products are inherently more careful in their approach to shopping (including checking of ingredients) and that this should be taken into account in deciding whether consumers were likely to be deceived by the MYBACON mark. On the contrary, the Court said that the relevant consumers to be considered were not limited just to vegetarians or vegans – the product was equally available to meat-eaters also; and thus it would be inappropriate to consider the mark from the point of view of a consumer who would be particularly careful and likely to check ingredients.

Secondly, Myforest argued that terms such as “burger”, “steak”, “sausage” and “bacon” have become generic for describing certain types of foodstuff, whether or not they are meat-based. This argument too was rejected by the Court: even if such usages could in certain circumstances render the mark non-deceptive, “the Board of Appeal was only required to establish that the sign was deceptive in one of its possible perceptions”. Thus, for so long as a significant proportion of consumers will read “bacon” as meaning meat-based, it does not matter that other consumers might have a more nuanced reading.

Finally (in the specific context of fungus-based proteins), the Court rejected an argument that the “MY-“ element of the mark (and of their company name Myforest) flagged up that it was made of mycoprotein, rather than of meat. Again, Myforest could not rely upon an argument that “their” vegan consumers would understand the “My-“ prefix as short for myco-protein – the product was marketed to consumers in general. Instead the “MY-“ prefix can be read as the English first person possessive pronoun. As the Court put it: “The fact that some consumers will understand the sign applied for as meaning ‘meat from the back and sides of a pig, dried, salted and usually smoked, developed for my requirements’ is sufficient for finding that the sign is deceptive.”

For more information, see here.