1. Stephen Groom What's in store in 2014?

2. osborneclarke.de 2 2 Predictions coming up…. Consumer rights big bang EU data protection reform Children's online games/apps Consumer credit advertising Big data-new data portability rights Intellectual property-new parody exception Nuisance calls and spam Prize promotions in Northern Ireland Cosmetic surgery and interventions ads The death of OBA cookies?

3. osborneclarke.de Consumer Rights Act 2014 ("CRA") #1 Implements the Consumer Rights Directive (2011/83/EU) and introduces other "Consumer Bill of Rights" measures Not to be confused with: –Consumer Rights Directive (2011/83/EU) ("CRD") to be partly implemented by the CRB –Consumer Bill of Rights precursor to the CRB –Consumer Rights (Payment Surcharges) Regulations 2012 in force since April 2013 –Consumer Contracts (Information, Cancellation and Additional Payments) Regulations 2013 implement most of the CRD due for sign-off soon –Consumer Protection from Unfair Trading (Amendment) Regulations not yet signed off CRA to replace and supersede eight measures including … –Supply of Goods (Implied Terms) Act 1973, Sale of Goods Act 1979, Supply of Goods and Services Act 1982 (B2C), Sale and Supply of Goods Act 1994, Sale and Supply of Goods to Consumers Regulations, Unfair Contract Terms Act 1977 (B2C) and Unfair Terms in Consumer Contracts Regulations 1999 3

4. osborneclarke.de Consumer Rights Act 2014 #2 Specific rights & remedies for consumers buying digital content Enhanced rights & remedies for consumers buying goods or services Improves consumer protection from unfair contract terms Clarifies powers of enforcers to investigate possible breaches Makes it easier for consumers and businesses to challenge anti-competitive market practices Headliners for advertisers: –Digital content descriptions must match any description provided, including functionality and interoperability info required by the CRD –New obligation to ensure that services must comply with all information supplied –Terms relating to price will only be exempt from unfair contract terms rules if they are "transparent and prominent" –TSOs can attach a range of enforcement measures to orders or undertakings 4

5. osborneclarke.de Consumer Contracts (Information, Cancellation and Additional Payments) Regulations 2013 #1 Will implement all parts of the CRD not already implemented They will supersede –Consumer Protection (Distance Selling) Regulations 2000 and –Cancellation of Contracts made in a Consumer's Home or Place of Work etc. Regulations 2008 Like rest of CRD, due to become part of UK law by 13 December 2013 and in force by 13 June 2014 Out of scope: similar to existing distance sales regulations eg financial services, gambling, package travel, package tours Cancellation rights exclusions: similar to existing eg concert tickets CRD is a maximum harmonisation measure 5

6. osborneclarke.de Consumer Contracts (Information, Cancellation and Additional Payments) Regulations 2013 #2 Headline points for advertisers –New 14 calendar day cancellation right instead of 7 working days –Distance sellers must provide a model withdrawal form for consumer use –New "14 calendar days after cancellation" deadline for returning goods –Revised pre-contract disclosure requirements –Pre-ticked boxes expressly prohibited –Trader must ensure that the consumer "explicitly acknowledges" that there is an obligation to pay –Confirmation of the contract must be sent to the consumer on a durable medium (as defined) 6

7. osborneclarke.de Consumer Protection from Unfair Trading (Amendment) Regulations 2013 Implements Article 27 of the CRD Introduces new rights of redress for consumers in respect of "prohibited practices" These include rights : –"to unwind" –to a discount –to damages Prohibited practice must have been a "significant factor" in the consumer's decision 7

8. osborneclarke.de Consumer rights big bang in 2014-predictions 13 December 2013: Consumer Contracts (Information, Cancellation and Additional Payments) Regulations 2013 ("CCRs") signed off but not  Consumer Protection from Unfair Trading (Amendment) Regulations ("CPUTARs") or  Consumer Rights Bill Demands for consolidation of all these and Consumer Rights (Payment Surcharges) Regulations 2012 rebuffed but 13 June 2014: CRA, CCRs and CPUTARs in force 8

9. osborneclarke.de EU data protection reform 21 October 2013: after 18 months of discussions "compromise draft" regulation signed off by LIBE committee of Euro MPs including new "mandatory" icons 25 October 2013: EU summit agrees that signing off on the new Data Protection Regulation by "early 2015" is a priority November 2013: Greece, holding the EU Presidency from 1/1/14, did not include the measure in its list of priorities December 6, 2013: next vote of Council's Justice Ministers on data protection reform: will EU Commissioner Reding's hopes of agreeing the measure before Euro elections in Spring 2014 be realised? Even when signed off, the measure provides for a 2 year lead-in period. 9

10. osborneclarke.de EU data protection reform prediction 6 December 2013: EU Ministers achieve no consensus on fast tracking the inter-institutional negotiation process Spring 2014: measure is not finalised before the Euro elections March 2015: after many more twists and turns a marginally more business- friendly Regulation is signed off March 2017: the new Regulation comes into force 10

11. osborneclarke.de Children's Online Games/Apps April 2013: OFT announces an investigation into methods used in online games to encourage children to make purchases October 2013: OFT publishes "Children's Online Games: Report and Consultation." The output of its investigation is distilled into 8 proposed principles OFT proposes to take action under the Consumer Protection from Unfair Trading Regulations ("CPRs") against traders in breach Trading Standards Institute comment: helpful guidance but Principles should be more clearly linked to the relevant legislation and rename the "Principles" "Best Practice Principles to ensure Legal Compliance in the Sector of Online and App-based games." 11

12. osborneclarke.de Children's Online Games/Apps-predictions March 2014: Following the OFT report consultation, the published Principles are more closely aligned to the CPRs and renamed "Best Practice Principles for Compliant Online and App-based Games"… and are accompanies by Guidance after concerns expressed in consultation responses that the OFT's notes to the Principles need further explanation June 2014: following a period of grace Trading Standards make it clear that enforcement action will be taken against games operators who breach the Principles and thereby breach the CPRs October 2014: Trading Standards launches the first prosecution against an online game operator for an "aggressive practice" in breach of the CPRs based on a breach of Principle 6 12

13. osborneclarke.de Consumer Credit advertising #1 April 2014: The Financial Conduct Authority takes over from the Office of Fair Trading the role of regulating the UK consumer credit industry October 2013: Financial Conduct Authority published a further consultation paper on its high level proposals for the new regime The Consumer Credit (Advertisements) Regulations 2004 and 2010 will be repealed and become part of the new FCA "Consumer Credit Sourcebook" ("CCS") Being clear, fair and not misleading will be the backbone to the FCA approach to consumer credit advertising The CCS adds guidance on aspects of the CCARs such as that statements about the speed of granting credit will be regarded as an "incentive" triggering the need to include an APR 13

14. osborneclarke.de Consumer credit advertising #2 FCA proposes to introduce a new risk warning for high cost, short term credit FCA will also in its rules reflect OFT Guidance on cold-calling and other unsolicited marketing activities: –firms must identify themselves and the purpose of the communication and –make sure it is an appropriate time of day –FCA may in the future consider banning cold calling Debt management companies ("DMCs") must not pass themselves off as a charitable, not for profit, government or local government organisation Before accepting leads from lead generation businesses ("LGBs"), DMCs must ensure that LGBs' websites and financial promotions comply with legal requirements 14

15. osborneclarke.de Consumer credit advertising-predictions 1 April 2014: FCA takes over the regulation of consumer credit and new rules for short term credit promotions come into force 1 September 2014: FCA responds to increasing concerns over nuisance calls promoting short term credit by carrying out its threat to propose a ban on unsolicited direct marketing telephone calls promoting these products 1 April 2016: after a two year interim regime the new consumer credit regime comes fully in force and the Consumer Credit Sourcebook rules on advertising replace the CCARs 15

16. osborneclarke.de Big Data-new portability rights November 2012: UK government challenged businesses to provide consumers with easy access to electronic data which was held on them 25 April 2013: after a disappointing response, a backstop power to compel businesses to do so was introduced at ss 89-91 of the Enterprise and Regulatory Reform Act 2013 Initially the industries affected are energy, mobile phone, current account and credit card services HMG will review progress in March 2014 Predictions: –April 2014 -HMG launches a review –November 2014 –"Midata" regulations introduced to consumer apathy 16

17. osborneclarke.de "Inspired by" advertising Parody and copyright: – 2011: Hargreaves Review green lights relaxation of copyright exceptions to allow parodies –June 2013 : IPO publishes draft secondary legislation –"copyright is not infringed by any fair dealing with a work for the purposes of caricature, parody or pastiche" Prediction: 1 December 2014- Copyright, Designs and Patents (Amendment ) Act 2014 introduces this amendment but the need to show fair dealing creates more rather than less challenges for "inspired by" advertising 17

18. osborneclarke.de Nuisance calls and spam Mass cold calling and spamming by PPI mis-selling claim management companies ("CMCs") is giving rise to serious concerns Inquiries by: –Nuisance Calls All Party Parliamentary Group-see Oct 2013 Report –Commons Culture Sport and Media Select Committee –Report soon Private member's bill proposes "opt in" call regime instead of "opt out" Numbers registered with TPS approaching 20,000,000 - TPS Assured launched MoJ/Treasury propose new penalties for use of info derived from practice ICO knocked back on appeals against monetary penalty notices("MPN") now seeks change of s.55A/55B DPA threshold: deliberate or negligent "serious breach.. likely to cause substantial damage or distress " HMG now looking at lowering the MPN threshold 18

19. osborneclarke.de Nuisance calls and spam-predictions January 2014: CMS Committee Report recommends lowering of threshold for imposition of MPNs to "serious nuisance or annoyance" March 2014: numbers registered with TPS reach 20 million (83% of UK residential fixed lines) May 2014: Financial Services (Banking Reform) Act passed, including provisions –empowering the FCA to impose fines up to £500,000 for the exploitation of personal data derived from cold calling practices in breach of the Claims Management Regulator's Standards June 2014: draft legislation tabled to reduce MPN threshold to "serious nuisance and annoyance" December 2014: new threshold in force 19

20. osborneclarke.de And the rest… Prize promotions and lotteries in Northern Ireland Prediction: December 2014 -NI Executive finally aligns its gambling legislation with Great Britain and allows purchase-to-enter prize draws Cosmetic Surgery and Interventions Prediction: September 2014 - following the DoH April 2013 Report, a new regime is launched including a public register of all practitioners and an advertising code prohibiting time limited deals, BOGOF, refer a friend and cosmetic procedures as prizes Behavioural targeting Predictions: 2014 - rumours of the "death of cookies" prove unfounded but still no fines imposed on cookie users who breach consent law 20

21. osborneclarke.de Face Forward 2014 Sum up New consumer rights laws– no real simplification, material associated costs and more exposure for all businesses selling to consumers, particularly online Telemarketing – by the end of 2014 we will know if it has a viable future as a sales channel and whether landlines have a viable future as a non sales communication medium Data privacy – EU reforms still some way off, but will existing data protection laws impacting direct marketing and OBA weather the current enforcement/credibility crisis? Advertising law enforcement – will trading standards step up to the plate? Intellectual property – creative free-for-all unlikely after new parody right comes on stream 21

22. osborneclarke.de 22 Any questions? Stephen Groom Osborne Clarke London T+44 (0) 207 105 7078 M+44 (0) 207 105 7079 stephen.groom@osborneclarke.com www.marketinglaw.co.uk