Talking Shop June 2021
Written By
Welcome to the June 2021 edition of our Retail & Consumer monthly news round-up
This newsletter focuses on key news and updates for retail and consumer-facing businesses around the world, including our latest briefings on the COVID-19 pandemic and its impact on the sector. You can find all our COVID-19-related updates for retail and consumer businesses on our dedicated InFocus page here.
At the end of the newsletter, you can find details of our recent news and events, which we think might be of interest to you and your team.
Please get in touch, or visit our webpage for more information about Bird & Bird's Retail & Consumer Group.
In this newsletter:
- Adtech
- COVID-19
- Competition & Consumer Law
- Data Protection
- Employment
- Franchising
- Intellectual Property
- Regulatory
- News & Events
Adtech
Global: Adtech for Retail & Consumer businesses - Q&A with Alex Dixie
Adtech specialist, Alex Dixie, joined our team in London earlier this year. In this video, Alex sits down (virtually!) with head of our Retail & Consumer group, Graeme Payne, to answer some key questions on adtech for businesses in the sector, including a summary of the big issues you should be aware of and some top tips for Retail & Consumer businesses wanting to make use of adtech.
COVID-19
UK: Government confirms additional protections which will support the retail and hospitality industry and COVID-19 related debt recovery
Earlier this year, the UK Government launched a consultation and call for evidence on commercial rents (read our article here). The consultation was an opportunity for the industry and its stakeholders to voice their concerns and provide suggestions as to what measures should follow the expiration of the commercial rent moratoria on 30 June 2021.
Although official results of the call for evidence are yet to be published, in a press release dated 16 June 2021 (see here), the UK Government has set out some of the next steps and protections for landlords and commercial tenants who are currently in disagreement over commercial rent arrears. We discuss the protections in further detail.
Competition & Consumer Law
Europe: European Commission publishes initial findings of inquiry into consumer Internet of Things
On 9 June 2021, the European Commission released its preliminary report presenting its key findings of its competition sector inquiry into markets for consumer Internet of Things (IoT) related products and services in the EU. This report was published following a sector inquiry launched in July 2020 as part of the Commission’s digital strategy. The findings are now subject to a public consultation, closing on 1 September 2021. The Commission’s analysis will also feed into its future enforcement and regulatory action.
Australia: Beware of consumer rights - $75,000 penalty imposed on Jayco for misleading a consumer about consumer guarantees
On 3 May 2021, the Federal Court imposed a penalty of $75,000 on Jayco Corporation Pty Ltd (Jayco) in respect of a contravention of section 29(1)(m) of Schedule 2 of the Competition and Consumer Act 2010 (Cth) (the ACL): Australian Competition and Consumer Commission v Jayco Corporation Pty Ltd (No 2) [2021] FCA 453.
Jayco is the largest manufacturer of recreational vehicles (RVs), such as caravans and campervans, in Australia. In December 2014, a customer purchased a new RV manufactured by Jayco from a dealer, Jayco Newcastle. The consumer found several “serious issues” with the RV, including that the pop top roof failed to raise, and water was not coming out of either of the water tanks on the RV. She made her concerns known to Jayco’s representatives on several occasions, including by emailing Jayco’s warranty team requesting “a full refund or a new replacement van”.
Denmark: Sportswear producer fined for resale price maintenance by Danish City Court
In 2017, a competitor to a Danish sportswear producer filed a complaint with the Danish Competition and Consumer Authority (“DCCA”) regarding resale price maintenance of said producer. The sportswear producer had put pressure on its distributors to respect the recommended price as a minimum price.
Following an investigation, the DCCA handed over the case to the Danish State Prosecutor for Serious Economic and International Crime in order for them to initiate criminal proceedings (as in Denmark fines for competition law infringements can be imposed only in the course of criminal proceedings). The resale price maintenance was documented in court with reference to e-mail correspondence between the parties. In its judgement, the City Court of Aalborg attached significant importance to a particular piece of correspondence containing the anti-competitive resale price maintenance.
UK: CMA publishes guidance on sustainability claims
Sustainability (or environmental) claims are increasingly part of the purchasing experience for consumers. Such claims can be made in the context of advertising, on product labels and within accompanying product information such as e-newsletters. Sustainability claims will typically state that a product, service, brand or business has a low or positive environmental impact. Indeed, businesses’ environmental credentials are becoming a key aspect on which they compete with a clear shift in consumer behaviour seeking sustainable products. In the last year, the CMA launched a market investigation taking an in-depth look at environmental claims.
On 21 May, the UK CMA published draft guidance based on the data gathered throughout the market investigation. The guidance sets out principles to follow when making sustainability claims. It is also peppered with practical examples which put the principles in context.
UK: Limiting liability in consumer terms - High Court rules in favour of online customer in £1.7 million dispute with Betfred
In Green v Petfre (Gibraltar) Ltd (t/a Betfred), the High Court ruled that Betfred were liable to pay out a customer’s £1.7 million winnings on a side bet allegedly caused by a software defect, despite Betfred’s claims that their consumer terms excluded liability for such defects.
This judgment provides an important reminder for any B2C businesses, not just gambling operators, seeking to exclude their liability for software defects online (or indeed for anything else). In particular, online businesses should be asking themselves whether their exclusions of liability are sufficiently (1) specific; (2) prominent; and (3) fair. If they fall short in any of those three areas, they may not be enforceable.
Data Protection
Europe: EDPB recommends collecting consent to store credit card details for future transactions
On 19 May 2021, the European Data Protection Board (EDPB) adopted the pithily named Recommendation 02/2021 on the legal basis for the storage of credit card data for the sole purpose of facilitating further online transactions, in which it concludes that online retailers should only store credit card details where they have the consent of the individual to do so.
In the EDPB's view, consent 'appears to be the sole appropriate legal basis' for storing credit card details—not only due to the increased risks to consumers in the event of a data breach, but also as a matter of putting the consumer in control of their data. The EDPB therefore recommends that 'the consent of the data subject should be obtained before storing his or her credit card data after a purchase' for any future transactions.
Europe: Replacement Standard Contractual Clauses (SCCs) - European Commission publishes final text
On 4 June 2021, the European Commission published its final Implementing Decision adopting new standard contractual clauses for the transfer of personal data to third countries. This follows the draft implementing decision and clauses issued by the European Commission for consultation on 12 November 2020. The Implementing Decision will be effective on the 20th day following its publication in the Official Journal of the EU, meaning that the Clauses can be used from 27 June 2021.
Employment
Australia: Deliveroo worker found to be an employee by Fair Work - what does this mean for the gig-economy?
If the decision handed down on 18 May 2021 by the Fair Work Commission is upheld on appeal, the decision is a landmark case that has the potential to completely change the current operational model of gig-economy platforms.
Commissioner Cambridge of the FWC found in Diego Franco v Deliveroo Australia Pty ltd (U2020/7066) that Mr Franco, a former Deliveroo driver, was an employee of Deliveroo. As an employee different rights attach to termination of the relationship, and the FWC held that the dismissal was harsh, unjust and unreasonable. As a result, Deliveroo was ordered to reinstate Mr Franco’s employment. This is the first case in Australia where the FWC has found against the gig-economy platforms’ assumption that gig-economy workers are independent contractors.
Franchising
Australia: The drowning of ‘JUMP! Swim Schools’ - over $23 million in penalties ordered by the Federal Court
On 19 May 2021, the Federal Court imposed a penalty of $23 million on Jump Loops Pty Ltd (in liquidation) (Jump Loops), the franchisor promoting and selling swim school franchises under the “JUMP! Swim Schools” brand (Franchise), for contraventions of the Australian Consumer Law (ACL): Australian Competition and Consumer Commission v Campbell (No 3) [2021] FCA 528. Further, the Court ordered that Mr Campbell – the founder, sole director and managing director of Jump Loops – pay a penalty of $400,000; pay $500,000 in compensation to affected franchisees; and be restrained for a period of 3 years from being in any way, directly or indirectly, involved in carrying on business as or of a franchisor.
Saudi Arabia: Franchise law update
Partner Melissa Murray and Associates Eddie Chiu and Mayowa Olusola in our UAE Franchising team have written an article published on the International Bar Association (IBA) website on Saudi Arabia franchise law, which you can read here. Melissa is a member of the IBA International Franchising Committee, which plays an educational role for the legal profession, judiciary and legislators, and enables members to examine and comment upon legislative and regulatory proposals affecting international franchising.
Intellectual Property
Global: Fashion-related IP decisions - 2020 round-up
In 2020, courts in Europe, Australia and Singapore delivered a series of important rulings of interest to and affecting the fashion sector. The Bird & Bird IP team contributed this round-up of the most significant fashion-related intellectual property judgments issued in the period 1 January—31 December 2020 to the Journal of Intellectual Property Law & Practice.
Global: It’s nearly BBQ season… but hold the meat! Tips to make your plant-based food brand thrive
Veganuary has been and gone, but there’s no better time to discuss the plant-based meat revolution. 2020 saw a huge rise in consumer demand for vegetarian and vegan options, and a particular surge in the growth of alternative protein sources. Supermarkets, restaurants and cafés are dedicating more resources towards plant-based, meat-free options to accommodate shifting consumer preferences.
Whether consumers are dabbling in plant-based preferences or in it for the long haul, one thing is clear – they’re demanding authenticity, transparency and integrity from the brands they choose to support. It's clear that brand protection will be central to the long-term viability of businesses looking to get a piece of the (quite substantial) plant-based pie. We have outlined some easily digestible pieces of advice to take away...
Australia: A warning to the brand that cried Wolff
In overturning a first instance judgment of the Australian Federal Court to find that VAGISAN is deceptively similar to VAGISIL, the Full Court of the Federal Court of Australia has stressed that the “central idea” of a trade mark – particularly if it is a striking feature – is central to a deceptive similarity analysis, and that descriptive elements shared by two trade marks should not be automatically disregarded when comparing the marks.
Australia: auDA introduces stricter licensing rules for .au domain names
The Australian administrator for the .au country code top level domain, .au Domain Administration Limited (auDA), has introduced the .au Domain Administration Rules: Licensing (Rules). The Rules consolidate and update more than 30 auDA Published Policies dealing with registrant obligations and the complaints process into a single uniform licensing scheme. The Rules are a corollary of the policy reform recommendations of the 2017 Policy Review Panel (Review) and the auDA Management Response to the Review. The CEO of auDA, Rosemary Sinclair AM, stated that the introduction of the Rules “signifies an important step forward in .au governance – modernising the policy framework, ensuring the .au domain can respond to the changing needs of Internet users, and continuing to build trust and confidence in .au namespaces”.
UK: Your chance to influence the future regime governing exhaustion of IP rights
The UK Government has launched a much-anticipated consultation on the exhaustion of IP rights. It is widely recognised that there will not be a consensus given the contentious nature of this subject, but the Government needs to make a decision on the future regime governing exhaustion. It is therefore calling for as many responses as possible to help in gauging the volume of parallel imports and the impact of any changes to the rules.
Regulatory
Europe: Innovation in the plant proteins space - regulatory environment and launch strategies for plant-based foods in Europe
Plant-based products and vegetable alternatives to dairy and animal protein-based products have been around for a while already. Initially based on tofu, seitan and others, their success and the growing consumer interest in diets based on less traditional animal proteins has led to high diversification and has stimulated research in new alternatives.
Consumer demand is growing, in a context where the (re)introduction of a significant vegetal component into the diet is often perceived and presented both as having nutritional and health benefits, but also as contributing to the development of more sustainable consumption patterns and more in line with a certain conception of animal welfare. In the context of the accelerating development of these vegetable alternatives and broadening of the offer on the market, the regulatory framework applicable to these products must be a focus of attention for food business operators.
Read more >
Czech Republic: What does the latest Food Act amendment mean for consumers and businesses?
The Czech Act on Food and Tobacco Products No. 110/1997 Coll. (“Food Act”) has been recently amended and most of the changes became effective as of 12 May 2021. The amendment implements new EU regulations and also amends other laws, including Regulations of Advertising Act (No. 40/1995 Coll.), Public Procurement Act (No. 134/2016 Coll.), and Act on Banks (No. 21/1992 Coll.). It brings significant changes, such as a ban on so-called dual food-quality, stricter conditions for designation of “Czech Food” and regulation of food containing edible insects. It is thus important for food business operators as well as consumers.
News & Events
Our Retail & Consumer team launches sustainability report in conjunction with the firm’s consultancy arm, OXYGY
We recently surveyed our clients on the impact of sustainability on business priorities, innovation and leadership in their companies. We asked our Retail & Consumer clients – who typically do not have a sustainability title – to provide their perspective on a range of sustainability-related topics, including the extent to which they are involved in helping shape and execute their organisation’s sustainability strategies and tactics.
We are delighted to announce the launch of the survey report, which we hope will provide you with insights to help move your business forward. We very much appreciate the time taken by all respondents to provide their perspective on this increasingly important topic, and look forward to supporting those who share our vision of sustainability as an essential driver of the business of the future.
Find out more and access the full report here.
Welltodo launches its 2021 Wellness Innovation Blueprint
This 70+ page resource maps out the rapidly expanding wellness industry ecosystem and the brands driving innovation and growth globally. Featuring 500+ of the industry’s most innovative brands, it is segmented by the 25+ key industry categories and sub-categories that Welltodo has identified as being the fastest-growing. Access the report here.
Our Wellness team has worked closely with Welltodo for a number of years. We partner with them on the Welltodo Founder Series - a leading event series for forward-thinking brands, start-ups, influencers and investors in the Wellness industry - and are the title sponsor of the Welltodo Summit.
Webinar: New French Supreme Court criminal case law - high risks within the context of corporate reorganisations and M&A
01 July 2021, 15:00 PM (BST); 16:00 PM (CEST); 07:00 AM (PDT); 09:00 AM (EDT)
We will be holding a webinar on the recent evolution of French case law on the criminal liability of an absorbing company for facts committed before the merger by the absorbed company. On 25 November 2020, the French Supreme Court (Cour de cassation) ruled that in the event of a merger, the absorbing company may now, under certain conditions, be criminally liable for facts committed by the absorbed company prior to the occurrence of the merger.
We will analyse the issues and consequences of this new case law and suggest preventive measures for your corporate/M&A reorganisations to avoid or, at least, reduce the criminal risk.
Click here to register.
Did you miss our webinar on Hotel Franchising?
Bird & Bird, AlixPartners, EP Business in Hospitality and HVS recently teamed up to present a webinar exploring hotel franchising.
We provided an overview of hot topics and themes in the franchise world and asked whether franchising is the way forward for hotel owners, before speaking with a panel of industry experts to discuss the pros and cons of hotel franchising.
Watch the webinar here if you missed it.
We recently co-hosted a live virtual event with GHD Advisory and ITPEnergised on the new investment reality - why ESG matters
We discussed how companies can address ESG factors in their decision-making process and the ESG risks associated with investments. The event gave some great insights on how to tackle current and future climate risks for businesses and provided a practical take on procurement techniques, sustainable financing structures and responsible investing into and by organisations. This included an exploration of the importance of the supply chain when setting and exceeding ESG targets and commitments with Graeme Payne (head of our Retail & Consumer group) and Stanislas Milcent (Quality, Food Safety, Environment, Research & Development Director at Moet Hennessy).
You can watch the event here if you missed it. The Bird & Bird team, in collaboration with GHD Advisory and ITPEnergised, has also produced a report on the topic, which you can view here.
