Wig seller failed to provide consumer with supplier's address in breach of distance selling rules, rules ad watchdog

Out-Law News | 18 Jul 2012 | 2:46 pm | 2 min. read

An online toupee-seller broke advertising rules by not providing customers with the address of its foreign supplier and not explaining that customers returning goods would have to pay customs duty, the UK's advertising watchdog has ruled.

The Advertising Standards Authority (ASA) upheld three complaints from a consumer who had raised issues about information contained on the 'returns & refunds' page on the wigshow.co.uk website. ASA ruled the claims made in the returns policy were misleading and could not be substantiated. It ordered the firm not to use the ad in its current form again.

The consumer bought a wig from WigShow but when they sought to return it the company told her she could only receive a refund worth up to 50% of her order costs and that she would need to pay customs duty. The wig was supplied from Hong Kong but the parcel the wig had arrived in did not detail the supplier's address.

WigShow's returns policy had explained that the company would "re-credit the original purchaser's credit card for the sum paid less the postal costs" but the firm had separately explained to ASA that they could either offer £45 compensation or a £55 refund. ASA deemed the company's online claims to be misleading and without substantiation. It also said the firm had breached distance selling rules contained in the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code).

"We considered the claim ... had not been substantiated and concluded that it was misleading," the watchdog said in its adjudication. "The website did not state the full geographical address of the advertiser. The complainant said that, when the wig arrived, the parcel indicated that it had been sent from Hong Kong but that the full geographical address of the supplier was not provided. We therefore concluded that the website breached the Code."

"The complainant said they were informed that, in order to return the wig, they would need to pay customs duty. Because there was no information on the website stating that additional international fees were payable, we concluded that it was misleading," it also found.

Under the CAP Code marketing communications that are materially misleading or likely to mislead are prohibited. The Code also bans marketing communications that mislead consumers "by omitting material information ... by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner".

'Material information' is defined under the Code as "information that the consumer needs to make informed decisions in relation to a product." The context and the medium and how advertisers make material information available to consumers through "other means" in cases where the time or space puts constraints on the medium, help determine whether missing material information or the way it is presented is "likely to mislead the consumer".

The rules also require advertisers to "hold documentary evidence" that can support the claims they make in adverts. The evidence must be of a sufficient standard that it is likely to be regarded as objective by consumers and is "capable of objective substantiation," according to the Code.

Marketing communications for distance selling, such as over the internet, are also bound by extra Cap Code rules. Those communications "must make clear the marketer’s identity and geographic address" and that information must be "given in a form that can be retained by consumers."

In addition marketers must provide consumers with written information on a number of aspects of their business and consumers' rights "at the latest by the time that goods are delivered or services begin." Among the information that must be included is "the full geographical address of the suppliers for any consumer complaints."