International promotions are occurring at a rapid pace in every product category as more companies sell to a global audience.
While going global is not as hard as it seems, there are very important legal issues to consider. Here are just a few.
- Laws Vary Country to Country
You will need to take into account the law in every country where you are marketing. To do this, it is critical to have a team of local legal experts. Lawyers licensed in the U.S. are only authorized to provide legal advice to clients on the laws of the state in which they are admitted to practice. Have your U.S. counsel take the lead and start with a set of U.S.-compliant official rules.
- Don’t Forget About Cultural Issues
Bring in local experts to make sure your promotion’s advertising or the prizes you are giving away don’t violate any cultural norms.
- Be Flexible About the Promotion Structure
For example, recent legal rulings in Canada have called into question the ability to structure a skill contest with a purchase requirement, while Hong Kong and Italy place limits on cash prizes. There are typically easy work-arounds, such as providing an alternate prize or method of entry.
- Be Prepared to Administer the Promotion Differently
Certain countries will require that you advertise and administer the promotion in very specific ways. For example, some jurisdictions require publication in newspapers, while others require that the advertising and rules be in the language of the local jurisdiction. Drawings may need to be held locally and witnessed by specific individuals, and winners notified by very specific methods. Lastly, some promotions may need to be registered in foreign countries.
- Privacy
Privacy law varies from country to country and, believe it or not, U.S. laws relating to the collection and use of personally identifiable information are quite lax as compared to the European versions. Therefore, the collection, storage, transfer and use of personally identifiable information require special consideration.
- Don’t Rely on One “Representative” Country
Don’t assume that because one country in a particular region permits the practice that it will be OK in all jurisdictions in those regions. This is particularly true of Asian countries, where there certainly will be differences in the law from one country to the next. Subtle country-specific interpretations of the law can make a big difference.
- Budget Time and Money to Get It Done Right
This last issue is perhaps the most important of all. Coordinating the legalities in multiple jurisdictions is certainly a bit more time consuming and expensive than the U.S. Be ready to add at least a week or two to your time line if your promotion involves more than just one or two international countries. Be prepared to pay an additional US$1,000 to US$3,000 per country for legal fees.
Joseph Lewczak is a partner in the Advertising, Marketing and Promotions Department of Davis & Gilbert LLP, New York, NY. He can be reached at 212-468-4909.
For more articles on consumer promotions, go to http://promomagazine.com/
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