Handpicked Media Ltd: non-disclosure of commercial blogging activity

Office of Fair Trading (OFT) closed consumer enforcement case.

From:
Competition and Markets Authority
Published
1 December 2010
Case type:
Consumer enforcement
Case state:
Closed
Market sector:
Communications
Outcome:
Consumer enforcement - undertakings
Opened:
1 July 2010
Closed:
1 December 2010

Case information

Case reference: CRE-E-25932

Complainant: OFT own-initiative investigation

Investigation against Handpicked Media Limited (Handpicked Media)

Issue

The engaging and remuneration of individuals in respect of online promotional activity in circumstances where it is not clearly identifiable to consumers that the promotion has been paid for.

Relevant instruments

Enterprise Act 2002, Consumer Protection from Unfair Trading Regulations 2008

Investigation summary

This investigation was opened by the OFT on its own initiative to investigate the engagement by Handpicked Media of bloggers on a commercial basis. The OFT was concerned that individuals engaged by Handpicked Media were publishing online content which promoted the activities of Handpicked Media's clients, without sufficient disclosures in place to make it clearly identifiable to consumers that the promotions had been paid for. This included publication on website blogs and microblogs (for example Twitter).

As a result of its investigation, the OFT formed the view that Handpicked Media may be operating in breach of the Consumer Protection from Unfair Trading Regulations 2008 (CPRs).  In particular, the OFT identified evidence of commercial practices which, it alleged to Handpicked Media:

  • constituted misleading omissions contrary to Regulation 3(4)(b) under the provisions of Regulation 6 of the CPRs, in that the promotion did not disclose material information (i.e. that the promotion had been paid for or otherwise remunerated), or provided that information in a manner that was unclear, unintelligible, ambiguous or untimely. As a result, this caused or was likely to cause the average consumer to take a transactional decision that would not have been taken otherwise, and

  • constituted unfair commercial practices, contrary to paragraph 11 of Schedule 1 of the CPRs, as they involved the use of editorial content in the media to promote a product where Handpicked Media had paid for the promotion without making that clear in the content or by images or sounds clearly identifiable by the consumer.

During the investigation Handpicked Media engaged constructively with the OFT and affirmed its commitment to full disclosure and transparency in relation to its activities.

As required in this case under the Enterprise Act 2002, the OFT consulted with Handpicked Media to ensure that the identified infringements are not continued or repeated. Following this consultation, Handpicked Media signed undertakings to comply with the law.

The Undertakings require that Handpicked Media does not continue or repeat the conduct of concern in this case.  For example, they prohibit any future promotion that does not clearly identify, in a manner prominently displayed with the editorial content such that it would be unavoidable to the average consumer, that the promotion has been paid for or otherwise remunerated.

Having secured these Undertakings, the OFT has now closed its investigation into this matter.

Published 1 December 2010