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Inertia selling to businesses (EW, S; NI equivalent regulations)

1. Introduction

1.1 The Unsolicited Goods and Services Act 1971 came into force in Great Britain on 12 August 1971 (equivalent regulations were made for Northern Ireland with effect from 19 January 1976 (Unsolicited Goods and Services (Northern Ireland) Order 1976). The law was enacted to regulate the perceived abuse of “inertia selling” by means of offers of un-ordered goods and services followed by demands for payment. This was especially prevalent regarding offers of entries in trade directories.

1.2 The 1971 Act was amended in 2000 when the [Consumer Protection (Distance Selling) Regulations 2000] came into force (see separate section). The latter introduced new rules relating to inertia selling to consumers and amended the 1971 Act so that it applied only to sales to businesses.

1.3 Unsolicited Goods and Services Act 1971: the Act creates offences of demanding payment for unordered goods and services, and for unordered trade directory entries unless certain strict conditions are met.

2. Unsolicited goods and services

2.1 The Unsolicited Goods and Services Act 1971 (“UGSA”) defines the following:
“Unsolicited”:  means, in relation to goods sent to any person, that they are sent without any prior request made by him or on his behalf.
“Asserting a right to payment”: any invoice or similar document stating the amount of any payment is be regarded as asserting a right to the payment unless it complies with the following conditions.

2.2 Conditions to be met for invoice or statement not to be treated as a demand
The conditions are set out in Part 2 of the Schedule to the Regulatory Reform (Unsolicited Goods and Services Act 1971) (Directory Entries and Demands for Payment) Order 2005):    (a)  it is clear, legible and comprehensible; and
(b) it contain the following statement, displayed in uppercase lettering
“THIS IS NOT A DEMAND FOR PAYMENTTHERE IS NO OBLIGATION TO PAYTHIS IS NOT A BILL”

2.3 Demands and threats regarding payment
The 1971 creates two main offences regarding demands for payment for unsolicited goods. The offences are committed by a person who, not having reasonable cause to believe there is a right to payment, in the course of any trade or business
(i)   makes a demand for payment, or asserts a present or prospective right to payment, for what he knows are unsolicited goods sent or delivered to another person with a view to his acquiring them for the purposes of his trade or business; or
(ii)  with a view to obtaining any payment for what he knows are unsolicited goods sent as aforesaid:
(a) threatens to bring any legal proceedings; or
(b) places or causes to be placed the name of any person on a list of defaulters or debtors or threatens to do so; or
(c) invokes or causes to be invoked any other collection procedure or threatens to do so

2.4 Enforcement
2.4.1 Civil enforcement: there are no specific civil enforcement measures. Legaleze comment: however any claim by the “inertia” seller for recovery of  could be met with the defence of illegality; the receiver may have a duty to keep the goods and not damage them at least for a reasonable period but specific advice should be taken.
2.4.2 Criminal penalty: on summary conviction the offences under (i) and (ii) above are punishable by a fine up to level 4 and level 5 respectively on the  <standard scale>.

3. Directory entries

3.1 A person (“the purchaser”) is not be liable to make any payment, and is entitled to recover any payment made by him, for including or arranging for the inclusion in a directory of an entry relating to that person or his trade or business, unless:
(a) the purchaser or someone on his behalf has signed an order complying with the order content requirements (see below); or
(b) the purchaser or someone on his behalf has signed a note complying with the order content requirements giving his agreement to the charge and before the note was signed, a copy of it was supplied, for retention by him, to him or to someone acting on his behalf; or
(c) the purchaser or someone acting on his behalf has transmitted an electronic communication which includes a statement that the purchaser agrees to the charge and the communication meets the electronic order content requirements (see below); or
(d)  the charge arises under a contract which complies with the requirements for renewed and extended contracts (see below).

3.2 Order content requirements
Requirements for an order for a directory entry: the requirements are:
(a)  an order for an entry in a directory must be made by means of an order form or other stationery belonging to the purchaser  which may be sent electronically but which must bear his name and address; and
(b) the note of a person's agreement to a charge must:
(i)  give reasonable particulars of the entry in respect of which the charge would be payable; and
(ii) specify the following particulars (these are set out in Part 1 of the Schedule to the Regulatory Reform (Unsolicited Goods and Services Act 1971) (Directory Entries and Demands for Payment) Order 2005):

(a)  the amount of the charge;
(b)  the name of the directory or proposed directory;
(c)  the name of the person producing the directory;
(d)  the geographic address at which that person is established;
(e)  if the directory is to be available in printed form, the proposed date of publication of the directory or of the issue in which the entry is to be included
(f)  if the directory or the issue in which the entry is to be included is to be put on sale, the price at which it is to be offered for sale and the minimum number of copies which are to be available for sale;
(g)  if the directory or the issue of the directory in which the entry is to be included is to be distributed free of charge (whether or not it is also to be put on sale), the minimum numbers of copies which are to be so distributed; and
(h)  if the directory is or is to be made available in a form other than printed form, adequate details of how it may be accessed.

Electronic order content requirements

Requirements for content of an electronic order:  the requirements are:
(a)  before the electronic communication was transmitted the following information was communicated to the purchaser:
(i) the amount of the charge;
(ii) the name of the directory or proposed directory
(iii) the name of the person producing the directory
(iv) the geographic address at which that person is established;
(v) if the directory is or is to be available in printed form, the proposed date of publication of the directory or of the issue in which the entry is to be included;
(vi) if the directory or the issue in which the entry is to be included is to be put on sale, the price at which it is to be offered for sale and the minimum number of copies which are to be available for sale;
(vii) if the directory or the issue in which the entry is to be included is to be distributed free of charge (whether or not it is also to be put on sale), the minimum number of copies which are to be so distributed;
(viii) if the directory is or is to be available in a form other than in printed form, adequate details of how it may be accessed; and
(ix) reasonable particulars of the entry in respect of which the charge would be payable.
(b) the electronic communication can readily be produced and retained in a visible and legible form.

3.3 Renewed and extended contracts
Requirements for a new or extended contract: the requirements are:
(a) a person (“the purchaser”) has entered into an earlier contract (“the earlier contract”) for including in a particular issue of a directory (“the earlier directory”) of an entry (“the earlier entry”) relating to him or his trade or business;
(b)  the purchaser was liable to make a payment under the earlier contract for the inclusion of the earlier entry in the earlier directory;
(c)  the new contract is a contract for including in a later issue of a directory (“the later directory”) of an entry (“the later entry”) relating to the purchaser or his trade or business;
(d) the form, content and distribution of the later directory is materially the same as the earlier directory;
(e) the form and content of the later entry is materially the same as the earlier entry;
Note: The test for deciding if a directory is “ materially the same” is whether a reasonable person in the position of the purchaser would view the two directories as being materially the same, or the later directory or the later entry as being an improvement on that of the earlier one.
(f) if the later directory is published other than in electronic form:

  (i) the earlier directory was the last, or the last but one, issue of the directory to be published before the later directory, and
(ii) the date of publication of the later directory is not more than 13 months after the date of publication of the earlier directory;

(g) if the later directory is published in electronic form, the first date on which the new contract requires the later entry to be published is not more than 13 months after the last date on which the earlier contract required the earlier entry to be published;
(h) if it was a term of the earlier contract that the purchaser renew or extend the contract:

  (i)     before the start of the new contract the publisher gave notice in writing to the purchaser containing the following information (which is set out in Part 3 of the Schedule to the Regulatory Reform (Unsolicited Goods and Services Act 1971) (Directory Entries and Demands for Payment) Order 2005):
*  the fact that the earlier contract is to be renewed or extended;.
*  the commencement date of the new contract;.
*  the cost to the purchaser of the new contract; and.
*  the fact that the purchaser may, within 21 days, write to the person by whom the notice is given withdrawing his consent to the renewal or extension of the contract; and
  (ii)     the purchaser has not written to the publisher withdrawing his agreement to the renewal or extension of the earlier contract within the period of 21 days starting when he receives the notice referred to in sub-paragraph (i);
(i)     if the parties to the earlier contract and the new contract are different:
(a)  the parties to both contracts have agreed to replace the earlier contract with the new contract; or
(b)  the publisher has before making the new contract given to the purchaser the following information (which is set out in Part 4 of the Schedule to the Regulatory Reform (Unsolicited Goods and Services Act 1971) (Directory Entries and Demands for Payment) Order 2005):
*  the name of the publisher; and.
*  the fact that, if the purchaser enters into the new contract,  the other party to the new contract will be the publisher; and the parties to the earlier contract and the new contract will be different.

4. Unsolicited sexual publications

4.1 Sexual techniques publications: it is an offence to send or cause to be sent to another person any book, magazine or leaflet (or advertising material for any such publication) which he knows or ought reasonably to know is unsolicited and which describes or illustrates human sexual techniques.

4.2 Penalty: the above offence is punishable on summary conviction to a fine not exceeding level 5 on [the standard scale].  A prosecution in England and Wales for this offence under requires the consent of the Director of Public Prosecutions.

5. Enforcement of the 1971 Act

5.1 Civil law enforcement: the 1971 Act has no specific civil law remedies except those dealing with when a publisher may require a purchaser to pay for a directory entry (see 3 above).

5.2 Criminal law enforcement: the effect of the Act is to create the offences described above. The Act imposes <director’s criminal liability>.

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The basics: contract for sale
Legal tender
Limitation and exclusion clauses
Sale of goods
Supply of services
Discrimination
Inertia selling to businesses
E-commerce
Sales to consumers
Unfair terms
Sales to consumers, distance selling
Doorstep selling
Marketing and advertising regulation    introduction
Advertising Codes
Advertising to businesses and    comparative advertising
Advertising to consumer regulations
Approved trader schemes
Direct marketing by telephone, email,    text message, fax and post
Data protection in relation to marketing