Advertising and the Sale and Supply of Alcohol Act 2012

Friday 2 May 2014

Authors: Marija Batistich and Kristin Wilson

First published in NZ Winegrower, April-May 2014 edition.

The new provisions of the Sale and Supply of Alcohol Act 2012 that came into force on 18 December 2013 may have dampened the holiday spirit for wine sellers advertising summer promotions. This article follows in further detail from the one in the previous issue on these new restrictions which mean that extra care has to be taken before advertising discounts, competitions or giveaways that involve alcohol, especially if these advertisements are published outside licensed premises.

Prize competitions

The Gambling Act 2003 prohibits alcohol being given away as a prize in competitions where entrants have to pay or purchase a product to enter, if the outcome of the competition depends on luck. The Sale and Supply of Alcohol Act 2012 now means that there are additional restrictions that must be taken into account when advertising a competition where the prize involves alcohol, regardless of the entry requirements. If a business runs a competition where alcohol forms part of the prize, the promotion may not be advertised anywhere people could see or hear it outside of licensed premises. This will include promotions where people subscribe to a newsletter to go into the draw to win a prize, where the competition is a game of skill, and any ‘lucky dip’ competitions.

As well as restricting the ability to advertise competitions that include alcohol as a prize, the Sale and Supply of Alcohol Act 2012 prohibits the advertising of promotions where the purchase of alcohol is required in order to enter, or where a certain amount of alcohol is required to be eligible for a reward.

‘Seen or heard’ from outside licensed premises will include advertising that is conducted via email, print, broadcast, or social media, including Facebook. Special care may need to be taken at festivals or shows where only a stall is licensed rather than the venue as a whole, as any such advertising that could be seen or heard from an unlicensed area could be in breach of the Act.

Advertising for these kinds of competitions and promotions can be conducted inside licensed premises, provided that:

  • the advertising cannot be seen or heard outside such premises;

  • no promotion, signage or activity encourages excessive consumption of alcohol or faster than normal drinking; and

  • no promotion is aimed at or has special appeal to minors.

Advertising of special offers

The Sale and Supply of Alcohol Act 2012 makes it an offence to advertise outside of licensed premises any promotions that are likely to make people think there is a discount of 25% or more available on any alcohol product.

The Act will extend to situations where advertisers imply or hint the discount is at least 25% rather than explicitly stating the amount of the discount, for example offering “crazy discounts”, “massive discounts” or “deals so good we can’t tell you about them”. Any deals advertised that includes offers of “two for the price of one” are likely to fall foul of this law.

It is permitted to advertise discounts of up to 50% inside licensed premises. It is also permitted for discounts of greater than 25% to be promoted or advertised in the catalogue or similar price list of the holder of an off-licence endorsed for remote-selling of alcohol under section 40 of the Act.

Advertising two-for-one meal offers that include a glass of wine for each person may imply that there is a 50% discount off the full price of the wine, which would breach the law. In order to comply with these rules, it is recommended that any offering that advertises a discount on a wine and food package should either be expressed to only cover the food and have the wine at full price, or include a statement that explicitly sets out the discount that applies to the food and separately the discount that applies to the wine so as to ensure the discount on alcohol does not exceed 25%. These amended offers must however be genuine - if the advertising is such that it will lead people to believe there is more than a 25% discount off the alcohol, it will still breach the Act.

Product giveaways

Care should be taken when conducting any advertising that involves alcohol giveaways. Offers such as “buy one, get one free”, “One free bottle of wine when a reservation is made” or “free glass of wine with every main purchased” is likely to be considered to breach the rule against advertising alcohol at more than a 25% discount.

The Act also prohibits the advertising of promotions that involve free products or services being given to customers who purchase alcohol, if such advertising is visible outside of licensed premises. The wording of the legislation is not restricted, and this could include for example an offer of a free cheese platter when a bottle of wine is purchased at a restaurant, or a free cooler-bag or wine glass when alcohol is purchased from an off-licence.

The Act does provide that it is permitted to promote or advertise the complimentary sampling of alcohol for consumption on premises for which an off-licence is held.

Conclusion

The major impact for the wine industry of the restrictions on advertising contained in the Act is likely to relate to advertising that is conducted outside of licensed premises. At licensed premises, where such advertising cannot be seen or heard from outside, businesses will be able to offer discounts of up to 50%, will be able to give away alcohol, will be able to give away incentives and run competitions that involve the purchase of alcohol, and will be able to run competitions where alcohol is a prize (provided the Gambling Act 2003 is complied with), much as they have in the past.

Penalties for breaching this section of the Act can include a fine of up to $10,000 and a loss of licence for up to seven days, so this legislation should be kept in mind whenever advertising involving alcohol is contemplated.


Disclaimer

This publication is necessarily brief and general in nature. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.

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