This article summarises a number of changes to the Consumer Protection Act (38/1978) entered into force on 15 June 2011. One of these changes concerns what entry requirements traders are allowed to set for consumers participating in a prize competition or a marketing lottery. Lotteries and competitions open only to those buying a product or service—i.e. ‘purchase required’ or ‘customers only’ lotteries—will now be allowed.
The previous rule in Finland was that everyone must be able to enter into marketing lotteries without payment of any kind. Since buying a product typically involves payment, the rule has meant that traders have been unable to hold purchase-required lotteries in Finland, with a limited exception for crossword puzzles and other small games in magazines and newspapers. Optional entry into the lottery by, for example, sending in a post card, has been a standard feature of Finnish marketing, since traders have been required to always offer a no-purchase alternative.
As a result of a ruling by the European Court of Justice (as further discussed below), this rule is now about to change. The Consumer Protection Act will be amended to allow traders to require that consumers buy a product or service before being able to enter into the lottery. In other words, traders will be able to raffle off, e.g. a DVD player among everyone who bought a TV during a particular week.
Despite of this change, lotteries will still have to comply with a number of other provisions in the Consumer Protection Act. Lotteries—whether they require a purchase or not—must still be held specifically for marketing purposes. It will not be possible to skirt gambling laws by only nominally selling products. Nor will, e.g. informational requirements be relaxed: the conditions for entering into and winning the lottery must still be made clear to all participants.
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The amendments in question are an outcome of the European Court of Justice’s holding in Case C-304/08 Zentrale zur Bekämpfung unlateren Wettbewerbs v Plus Warenhadelsgessellschaft. According to the ECJ, a similar rule found in the German Law on Unfair Competition (commonly referred to as the ‘UWG’) was incompatible with the European Union’s Unfair Commercial Practices Directive of 2005.
This is because the Unfair Commercial Practices Directive is a maximum harmonisation directive and specifies both the minimum and maximum levels of consumer protection law that members states must maintain. Before the UCPD, each member state was only required to meet certain minimum standards of consumer protection, but could also choose to maintain stricter standards. Now, however, the EU has set a maximum level of consumer protection that member states cannot exceed. The hope is that this will make it easier and more cost-effective for European businesses to engage consumers all over the EU.
Marketing lotteries are not the only thing affected by the UCPD. In 2009, the ECJ also found that rules banning combined offers to consumers were in conflict with the UCPD, thus requiring changes in a number of member states. In Finland, the Consumer Protection Act had already been amended in 2000 to allow combined offers. They are still subject to restrictions, however.
Since the ECJ’s ruling on marketing lotteries, a number of EU member states have to amend their respective consumer protection laws to allow purchase-required lotteries. Since the regulatory schemes for marketing lotteries have been quite different in the various member states, it is not immediately clear in all cases what amendments, if any, the ECJ’s ruling will require to each member state’s laws. It will therefore likely take some time before the laws governing marketing lotteries become truly harmonised throughout the EU.
The Finnish amendment to allow purchase-required lotteries requiring a purchase came into force 15 June 2011.