(ECJ 18 October 2012 case 428/11, 6th Chamber)
Practices by which companies give consumers the false impression of having won a prize, when in fact they must incur a cost, even negligible, in order to receive the prize, are prohibited.
The dispute involved five British companies which had notified consumers they had won a prize and offered them a number of options to find out precisely what they could claim (via premium rate call, SMS or post).
The Office of Fair Trading (OFT) had referred the case to the High Court of Justice which had ordered the companies to cease such unfair practices. The companies had appealed the decision before the Court of Appeal, which had adjourned the proceedings in order to seek a preliminary ruling by the ECJ on interpretation of point 31 of Annex 1 of the Directive of 11 May 2005 according to which an aggressive practice is established by "creating the false impression that the consumer has already won, will win, or will on doing a particular act win, a prize or other equivalent benefit, when in fact either, there is no prize or other equivalent benefit, or taking any action in relation to claiming the prize or other equivalent benefit is subject to the consumer paying money or incurring a cost", in order to demonstrate whether the practice is established even if the cost incurred by the consumer in relation to claiming the prize is negligible.
The ECJ considers that such a practice is reprehensible and that it was irrelevant (i) that the cost imposed on the consumer be negligible as compared with the value of the prize or that it does not procure the company any benefit, and that (ii) the actions related to claiming the prize may be completed via several methods offered to the consumer by the company, one of which at least is free of charge.