Distance Selling Code of Practice for wines & spirits · All Merchants displaying The ... Practice which supports it fully reflect the modern era of global ... Distance Selling Code

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THE WINE AND SPIRIT TRADE ASSOCIATION

Freight Forwarding for the wine and spirit industry

THE WINE AND SPIRIT TRADE ASSOCIATION

Distance Selling Code of Practice for wines & spirits

Published by The Wine and Spirit Trade AssociationInternational Wine & Spirit Centre

39-45 Bermondsey Street LONDON SE1 3XF t +44 (0)20 7089 3877 / f +44 (0)20 7089 3870 / [email protected]

Registered Number: 410660 England Limited by Guarantee

Updated 2011Copyright © The Wine and Spirit Trade Association

CONTENTSOVERVIEW 31. Thelogoandthecodeofpractice2. Theneedforacodeofpractice3. Whatdoesthedistancesellingcodeoffer

ANNEX A: THE DISTANCE SELLING CODE OF PRACTICE FOR WINES AND SPIRITS 5

1 INTRODUCTION 61.1 Definitions1.2 OriginsofTheCode&CommitmentofDSPMembers1.3 BasisoftheCode1.4 HandlingofComplaints1.5 Sanctions1.6 Footnotes

2. GENERAL OBLIGATIONS 102.1 MailOrder2.2 E-Commerce2.3 ConditionofuseoftheWSTADistanceSellingCodeLogoandpersonsauthorisedtouseit2.4 Under-agesales

3 DIRECT SELLING: OFFERS AND FULFILMENT 133.1 ConformityofGoodstoDescription3.2 Informationtobegiventoacustomerpriortoconclusionofacontract.3.3 ConfirmationofanOrder3.4 MailingandPackaging3.5 CashWithOrder3.6 RightofWithdrawal3.7 FulfilmentofOrders3.8 Jurisdiction

4 CUSTOMER COMPLAINTS 194.1 CompanyProcedures4.2 ReferralstotheWineandSpiritTradeAssociation4.3 MonitoringCompliancewiththeCode

5 SECURITY PROCEDURES (Company Systems) 21

6 PRIVACY PROCEDURES 236.1 CompanyProcedures6.2 GeneralRules6.3 Obtainingpersonaldata6.4 Objections6.5 SuppressionofInformation6.6 MailingListsrented-in6.7 MailingListrented-out6.8 Transferofliststoathirdcountry6.9 Unsolicitede-mail

7 CUSTOMER RECRUITMENT ADVERTISING 297.1 Media7.2 SupportforotherUKCodesofPractice7.3 Rules

ANNEX B: THE WSTA DISTANCE SELLING CODE LOGO 32ANNEX C: CODE OF PRACTICE ACCEPTANCE FORM 34ANNEX D: GUIDE TO EN PRIMEUR WINE 36ANNEX E: GUIDE TO WINE INVESTMENT: CAPITAL GAINS TAX AND INHERITANCE TAX 40ANNEX F: DISTANCE SELLING FRAUD PREVENTION GUIDELINES 43

Distance Selling Code of Practice for wines and spiritsTHE WINE AND SPIRIT TRADE ASSOCIATION

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OVERVIEW

The Distance Selling Code of Practice for Wines & Spirits

All Merchants displaying The WSTA Distance Selling Code Logoare bound by the WSTA Distance Selling Code (“The Code”)

1. THE LOGO AND THE CODE OF PRACTICE: THEIR SCOPE

AnypurchasemadefromamerchantdisplayingtheWSTADistanceSellingCodelogo(AnnexB)willbegovernedbythelawofEnglandandWaleswhethertheconsumerisbasedinanotherEuropeanmemberStateorelsewhereintheworld.ThelogoandtheDistanceSellingCodeofPracticewhichsupportsitfullyreflectthemoderneraofglobalcommunications.

2. THE NEED FOR A CODE OF PRACTICE

The Distance Selling Code of Practice: TheDistanceSellingCodeofPractice(attachedatAnnexA)hasbeendevelopedby leadingwinemerchants inUK toaffirmahigh standard of servicewhichreflectstheircommitmentbothtoconsumersandtoUKandEuropeanlegislation.MerchantsdisplayingtheWSTADistanceSellingCodelogoabidebytheCode.

A Fair Deal and Peace of Mind for Consumers: WhenmakingapurchasefromamerchantorsupplierdisplayingtheWSTADistanceSellingCodelogo,consumersareofferedafairdealandareensuredpeaceofmind.

3. WHAT DOES THE DISTANCE SELLING CODE OFFER:

Accessibility: All Distance Selling offers for sale will state clearly the name, address andtelephonenumberofthemerchantmakingthem,toensurethatthemerchantiseasilycontactablebythecustomer.

Conformity of Goods to Description: AllwinesdespatchedinresponsetoordersplacedasaresultofaDistanceSellingspecialofferoradvertisementwillbeofsoundqualityandwillconformwiththedescriptionadvertised.

Delivery: Withtheexceptionofbespokeshipmentsandwinesoffereden primeur,theDistanceSellingmerchantundertakestofulfilorderswithin30daysofreceivingthem.Shouldcircumstancesmakethisimpossible,thecustomerwillbeofferedasubstituteofatleastequalvalue,arefundor,ifheorshepreferstowait,alternativeagreedarrangementsfordelivery.

Right of Withdrawal: Havingacceptedanoffer, customerscanwithdraw fromanyDistanceSellingpurchase,exceptforbespokeshipmentsandwinesoffereden primeur,uptosevendaysafterreceiptofthegoodswithoutpenaltyandwithoutgivinganyreason.SeparatetermsapplytocustomerslivingoutsidetheEuropeanUnion.

Cash Refunds: willbegivenimmediatelybyaDistanceSellingmerchantwhoisinanywayinbreachofhispublishedtermsofbusiness.


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Data Protection: AllreasonablestepswillbetakenbytheDistanceSelling merchanttomaintainaccurate,up todatemailing lists, tosafeguard them fromunauthorisedor improperuseandtorespondpromptlytorequestsfromcustomersthattheirnamesbedeleted.DistanceSellingMerchantswillabidebyDataProtectionlegislationcurrentlyinforce.

Social Responsibility:DistanceSellingmerchantssupportUKcodesofadvertisingpracticeinrelationtotheadvertisingofalcoholicdrinks.Forexample,theywillnotattempttosuggestthatconsumingalcoholisinanywaymedicallytherapeutic,orgoodforthepersonalimage,socialsuccessorsexualprowessofthedrinker.

• TheDistanceSellingCodeofPracticefollowsatAnnexA

• TheWSTADistanceSellingCodelogoisavailableatAnnexB

• TheWSTADistanceSellingCodeacceptanceformisavailableatAnnexC

• AGuidetoEnprimeurwineisavailableatAnnexD

• AGuidetowineinvestment,CapitalGainstaxandinheritancetaxisavailableatAnnexE

• FraudpreventionguidelinesareavailableatAnnexF

THE DISTANCE SELLING CODE OF PRACTICE FOR WINES & SPIRITS

Annex A

1. INTRODUCTION

1.1

1.2

1.3

1.4

1.5

1.6

Definitions

Origins of the code & commitment of Distance Selling Panel (DSP) members

Basis of the code

Handling of complaints

Sanctions

Footnotes


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1. INTRODUCTION

1.1 Definitions

ForthepurposesofTheDistanceSellingCodeofPracticeforWinesandSpirits(“TheCode”),DistanceSellingincludes:

Mail Order: purchasingmade at a distance, i.e. when the customer does not attend thepremisesfromwhichthegoodsaresold;and/or

E-Commerce:anycommercialcommunication,orcommunicationincludingadvertisementsand offers for goods and services, which take place on-line i.e. through e-mail, Internetwebsites,interactivedigitalTV,CD-RomorWirelessApplicationProtocol.

1.2 Origins of The Code & Commitment of Distance Selling Panel (DSP) Members

• The Code has been devised in recognition of the fact that each Distance Selling PanelMember(the“DSPMember”)oftheWineandSpiritTradeAssociation(WSTA)hasitsowntraditions, culture and approach to “Distance Selling”, both in the satisfaction of existingcustomerrequirementsandtheexpansionofitsbusinessbynewcustomerrecruitment,andthatnoDSPMemberislikelytowishtojeopardiseitsbusinessandreputationbyoffendingitsexistingandprospectivecustomerbasethroughunethicalbusinesspractice.

• EachDSPMemberundertakes tooffer forsaleonly thosewinesandspiritswhichareofsound,merchantablequality,usingaspecialisedand,wheneverpossible,apersonalservicewhichmakesworthwhiletheunavoidablewaitfordelivery.

• DSPmembersaremembersoftheWineandSpiritTradeAssociationandabidebytheArticlesofAssociationoftheWineandSpiritTradeAssociation.Theconditionsofmembershipoftheassociationaresetoutunder the ‘Membership’sectionof thearticlesofassociation(see:http://www.wsta.co.uk/images/stories/articlesofassociation.pdf)

• Aspects of this servicemay include free advice of the kind not always available at self-selectionretailoutlets,theprovisionofarangeofwinesandspiritswhichislikelytobelesswidelyavailableelsewhereand,becauseofDSPMembers’knowledgeandlong-establishedcommercialrelationshipswithproducers,theopportunityforcustomerstopurchaserareormaturingwinesandvintages1‘en primeur’.

• AdherencetoTheCodealsocommitseachDSPMembertoworkwithinthestatutorycodesofpracticeunderwhichtheregulatorybodiesofthedirectmarketingandadvertisingindustrieshaveagreedtoco-operatewiththeBritishGovernmentintheregulationofconsumer-friendlytrading practices, and in the acquisition, processing and utilisation of personal data formarketingproductsandservicestotheconsumer.

1 Wines sold ‘en primeur’ are wines in an unfinished state, either in bottle, cask or tank, lying in the producers’ cellars at the time of sale.

http://www.wsta.co.uk/images/WSTA/articlesofassociation.pdf


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1.3 Basis of the Code

ThisCodeofPracticeisbaseduponthe:

• Data Protection Directive (95/46/EC)(implementedintheUKbytheDataProtectionAct1998);

• Directive on Privacy and Electronic Communications (2002/58/EC) (theprovisionsofwhichareimplementedinUKlawbytheDataProtectionAct1998)

• Directive on Unfair Terms in Consumer Contracts (93/13/EEC) (implementedintheUKbytheUnfairTermsinContractsRegulations1999)

• Distance Selling Directive (97/7/EC) (implementedintheUKbytheConsumerProtection(DistanceSelling)Regulations2000);

• UK Rules for Direct Marketing(includingList and Database Management),andtherulesaffectingdrinksadvertisingissuedbytheCommittee of Advertising Practice and administeredbytheCouncilofthe[UK]Advertising Standards Authority(ASA).

(TheseBritishcodesofpracticeweredrawnup inconsultationwithall representativebodiesofthedirectmarketingandadvertisingindustries,andwiththeiraccompanyingsanctions(seebelow),havebeendesignedtosafeguardconsumersandtopromoteandenhancetheeffectivenessofself-regulation.)

• Direct Marketing Association (UK) Code of Practice for Electronic Commerce

• Social responsibility StandardsfortheproductionandsaleofalcoholicdrinksintheUK

1.4 Handling of Complaints

IntheeventofacomplaintinvolvingabreachoftheCode,aconsumer’sfirstrecourseshouldbetotheDSPMember;iftheproblemcannotberesolved,he/sheshouldwritetotheWineandSpiritTradeAssociation,39-45BermondseyStreet,LondonSE13XFgivingfulldetails.

Ifthereisadispute,bothpartieswillhaverecoursetoAlternativeDisputeResolution(ADR)ontheadviceof theUKCharteredInstituteofArbitrators,andsanctionsmaybe imposedagainsttheDSPMemberfoundtobeatfault.

1.5 Sanctions

SanctionsincludeexpulsionoftheDSPMemberfromtheDSP,and/orfromtheWineandSpiritTradeAssociation;andwithdrawalofentitlementtodisplaytheWSTADistanceSellingCodelogo.

Also,recommendationscanbemadetootherthirdpartieswhichmayresultin:


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• publicationofthebreachintheAdvertising Standards Authority Monthly Reportofcomplaintadjudicationswhichreceiveswidecoverageinthemedia;

• lossofrecognitionby,andanycommissionentitlementfrom,theDirect Mail Services Standards Board;

• suspensionand,ultimately,witholdingofaRoyal Mail Mailsortcontract;

• refusalbythemediatopublishordisseminatefurtherdirectresponseadvertisements,includingdirectmail;and

• whenappropriate,referralofthebreachtotheInformation CommissionerortotheDirector General of Fair TradingasthelegalbackstopstotheASA’sactivities.

1.6 Footnotes

FootnotesshouldberegardedasbeingpartofTheCode.

2. GENERAL OBLIGATIONS

2.1

2.2

2.3

2.4

Mail Order

E-Commerce

Condition of use of the WSTA Distance Selling Code Logo and persons authorised to use it

Under-age sales

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2. GENERAL OBLIGATIONS

• Memberswillnotknowinglyselltoconsumersundertheageof18.• Memberswillnotknowinglyacceptdistancesellingordersfromconsumersundertheage

of18.• Membersshouldhaveawrittenpolicyinplaceinrelationtounder-agesales.

2.1 Mail Order

It is recommended thatDSPMembers carrying outMailOrder sales should prominentlydisplaytheDistanceSellingMarkintheirpromotionalmaterial.Itisalsorecommendedthatsuchmembersshouldpublishdetailsofwhere their customerscanobtainacopyofTheCode.

2.2 E-Commerce

ItisrecommendedthatDistanceSellingPanelMemberswhocarryoutE-Commerce:

• includeontheirwebsiteahotlinktotheWSTAwebsitetoallowconsumerstoaccessinformationonTheCode;

• prominentlydisplayontheirsellingoffercommunicationtheDistanceSellingMark;and

• ensurethattheirwebsitesareinplainEnglishorotherappropriatelanguagesothatuserscaneasilyunderstandtheircontents.

2.3 Conditions of Use of the WSTA Distance Selling Code Logo and persons authorised to use it.

ItisaconditionofusethattheWSTADistanceSellingCodeLogoshallnotbeusedinanyprintedadvertisementsorprintedpublicitymaterialdirectedprimarily to themarket in theUnitedKingdomandintheIsleofManorinretailpointofsaledisplaycardsdistributedbytheRegisteredProprietorforusewithintheUnitedKingdomandintheIsleofManwithoutindicatingthatitisaCollectiveMark.

ThepersonsauthorisedtousetheDistanceSellingLogoaremembersoftheWineandSpiritTradeAssociationwhoarealsosignatoriestotheWSTADistanceSellingCode.SignatorieshavetosigntheformatAnnexCandagreetoabidebytheconditionsoftheWSTADistanceSellingCode.ARegisterofMembersiskeptbytheWineandSpiritTradeAssociationandisavailableonrequest.

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2.4 Under-age sales

Memberswillnotknowinglyacceptordersfromconsumersundertheageof18placedonlineorbypost.

Ageverificationforsalesofalcoholisamandatorylicensingcondition;DistanceSellershaveadutytoverifyageatthepointofsale.

Section10.67of theStatutoryGuidanceof theLicensingAct requiresdistancesellers tooperateanageverificationpolicyinrelationtoremotesales.Itstipulatesthat‘Companiesthatsellalcohol remotely (e.g.onlineorbymailorder)shouldoperateanageverificationpolicy,butas thesaleofalcoholdoesnotordinarily takeplaceondelivery, theconditiondoesnotinsuchcasesrequirephotoIDtobeshownatthepointofdelivery.Aslongasageverification has taken place already via anothermeans, these transactionswillmeet therequirementofthecondition.’

According tosection151(6)of theLicensingAct2003, there isno legalduty fordistancesellerstoageverifyatthepointofdelivery.It is legaltodeliveralcoholtoanunder18aslongastheorderisplacedbyanadultandthedeliveryismadetothatadult’shomeorofficeaddress.

Membersshouldfollowtheseguidelineswithrespecttotheirwebsites:

• Carryareminderoftheneedtoadheretothelegalpurchaseageinthecountryinwhichtheconsumerislocated.

• Useageverificationinrelationtoonlinesales

3. DIRECT SELLING: OFFERS & FULFILMENT

3.1

3.2

3.3

3.4

3.5

3.6

3.7

3.8

Conformity of Goods to Description

Information to be given to a customer prior to conclusion of a contract

Confirmation of an Order

Mailing and Packaging

Cash With Order

Right of Withdrawal

Fulfilment of Orders

Jurisdiction

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3. DIRECT SELLING: OFFERS AND FULFILMENT

3.1 Conformity of Goods to Description

Allproductsdespatched inresponsetoordersreceivedshouldconformto thedescriptiongiveninalladvertisingmaterial,includingcustomernewsletters,websitesandallrecruitmentmedia.

Productswhicharefaulty,outofconditionorofpoorqualitywillneverknowinglybesoldasofsoundquality.IntheabsenceofanunconditionalguaranteebytheDSPMembertoreplaceanypurchasewhichisnottothecustomer’ssatisfaction,substituteswillonlybesuppliedwiththeexpresspermissionofthecustomer,orwherepublishedconditionsofsaleindicatethatsubstitutesmaybemadetofulfilorcompleteanorder.

3.2 Information to be given to a customer prior to conclusion of a contract.

3.2.1 WhenmakingaDistanceSellingofferbyanymeans,andingoodtimepriortoconclusionofthecontract,DSPMembersshouldinclude:

• Company details;

companynameandaddress(inthecaseofE-Commercetransactionsthismustbetheirmaine-mailaddressandtheirphysicaloff-lineaddress);

• the main characteristics of the goods;

• a contact point for enquiries;

legal,postalcontact,ande-mailaddress(ifapplicable);registeredcompanynumber;place of registration; country/state of establishment; terrestrial telephone number;hoursofbusiness;

• the price of the goods; and

alltaxes,duties,deliverycostsandanyotherchargesthatmayapplymustbestatedinapplicablecurrenciesandtheexacttotalpayablemustbeeasilycalculated;

• clear details of how to order;

• arrangements for payments, delivery or performance;

• existence of a right of withdrawal

• the period for which the offer or the price remains valid;

• for DSP members proposing to replace unavailable ordered items with previously unspecified substitutes, confirmation that this will be the case and that, if such substitutes are rejected by the customer, the DSP member will pay for return carriage.

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• in the case of en primeur sales, a warning that the value of such wines can fluctuate whilst in barrel or warehouse.

3.2.3The requirement to provide the DSPmember’s name and address does not prevent anadvertiserfromstatinginhisadvertisementanotheraddresstowhichconsumersaretosendtheir orders, and this addressmay be in the form of a box number, freepost number oralternativee-mailaddress.

3.2.4 Inparticular,inthecaseoftelephonecommunications,theDSPMember’sidentityandthecommercialpurposesofthecallmustbemadeclearatthebeginningofanycommunicationwiththecustomer.

3.3 Confirmation of an Order

3.3.1 WrittenConfirmation

Bythedateofthedeliveryofthegoods(or,inthecaseofanE-Commerceoffer,assoonasanorderisaccepted)DSPMembersshouldprovidecustomerswithwrittenconfirmationofthe:

• informationlistedinparagraph3.2.1;

• thetotalandfinalpriceoftheorder2;

• auniqueidentifyingordernumber;

• conditionsandproceduresforexercisingtherightofwithdrawal(seeparagraph3.6);

• addresstowhichthecustomermayaddresscomplaints(seeparagraph4);

• whereappropriate,theminimumdurationofthecontractinthecaseofcontractstobeperformedrecurrently;

• anyrestrictions,limitations(e.g.allocationsofproductsubjecttoavailability),conditionsofpurchase,geographicortimerestrictions;

• thetermsandconditionstowhichthetransactionissubject.

3.3.2 ElectronicConfirmation

InthecaseofE-Commercetransactionsthedetailslistedin3.3.1mustbeprovidedinadurablemediumwhichisavailableandaccessibletothecustomer.

3.4 Mailing and Packaging

DSP Members will carefully consider goods and their packaging (in the light of currentpackagingregulations)bearinginmindthatchildrenoftenhaveaccesstopackagesdeliveredtothehome,andensurethattheyarefitforpurpose.

2 Goods sold en primeur are subject to price fluctuations whilst in bond. In this regard, customers will be provided with as much information as is reasonable

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3.5 Cash With Order

3.5.1 Paymentbycreditcardorchequemustnotbecasheduntilthegoodsarereadyfordespatchinaccordancewiththeoffer3,althoughchequesforordersthatcanonlybepartfulfilledmaybecashedtopermitrefund.

3.5.2 DSPMembersareunderanobligationtoreturnallmoneypaidinadvancebythecustomer,eitherbycashrefundorbyanyothermeansagreedwiththecustomer,when:

• attention isdrawn to thebenefitofamoney-backor replacementguarantee(however

expressed),andnolimitisplacedintheadvertisementupontheperiodduringwhichsuchaguaranteeistobeeffective.Insuchacase,theDSPMembershouldbepreparedtomakearefundatanyreasonabletime,havingregardtothenatureoftheproduct;

• thecustomerexpressesawishtobereimbursedbecauseofdelaybeyond30daysinthefulfilmentoftheorder,unlessalongerdeliveryperiodhasbeenpreviouslyagreedwiththecustomer(seeparagraph3.7.3);

• for whatever reason, the product received by the customer does not conform to the

DSPMember’sdescription,ortheDSPMemberisinbreachofanypublishedtermsofbusiness. Insuchcases thecustomerwillnotbeexpected tobear thecostof returnpostageorcarriage(seeparagraph3.5.3);

• thecustomerwishestoexercisetheirrightofwithdrawal(seeparagraph3.6)

3.5.3 All refundsorcreditswhich theMember is required tomakewillbemadepromptlyuponthe customer’s request. In this regard, DSPMembers are under no obligation to acceptresponsibilityforgoodsreturnedbyacustomer,butwhichtheDSPMemberhasnotreceived,orforbespokegoodssuchasacustomer’s“ownlabel”orspecialrequirement,providedthattheDSPMemberisnotinbreachofcontractualobligations.

3.6 Right of Withdrawal

3.6.1 TheDSPMemberwillmakeclearwhetherthecustomerisexpectedtopayreturncarriagewhenexercisingtherightofwithdrawal.

3.6.2 SalestoCustomerforDeliveryWithintheEuropeanUnion

• TheCustomerwillhaveaperiodofatleastsevenworkingdaysfromthedayafterthedateofreceiptwithintheEUbythecustomerorhisagentofthegoodsinwhichtowithdrawfromthecontractwithoutpenaltyandwithoutgivinganyreason.Inthisregard,theonlychargethatmaybemadetoaconsumerexercisingtherightofwithdrawalisthedirectcostofreturningthegoods,providedthatthecustomerhastakenreasonablecareofthegoods.

• IftheDSPMemberhasfailedtofulfiltheobligationforwrittenconfirmationofanorder,(seeparagraph3.3),acustomerwillhavetheright of withdrawal up tothree monthsfromthedayafterthedateofreceiptofthegoods.

3 Except for goods sold en-primeur which are usually delivered at least a year after the order is placed

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3.6.3 SalestoCustomersforDeliveryOutsidetheEuropeanUnion

ThesamerightofwithdrawalwillapplytocustomersoutsidetheEuropeanUnion,exceptthatthecustomerwillhaveaperiodofatleastsevenworkingdaysfrom:

• thetimewhenthecustomerreceives4notificationfromtheDSPMemberthatthegoodsarereadyfordespatch,orfrom

• receipt of the goods by a designated shipping agent; inwhich towithdraw from thecontractwithoutpenaltyandwithoutgivingany reason, (seeparagraph3.7.4). In thisregard,thesevenday‘coolingoff’periodwillapplyonlyforaslongasthegoodsremainwiththeagent.

3.6.4 Winessolden primeur:DSPmemberswillmakeclearwhetherornottheyofferarightofwithdrawalfromen primeurcontractsand,ifso,underwhatcircumstances.

3.7 Fulfilment of Orders

3.7.1 DSPMemberswillnotintentionallycreateademandforproductswhichcannotbemet.

3.7.2 AllMailOrderandE-CommerceoffersandcustomerrecruitmentadvertisingwillindicatetheperiodwithinwhichtheDSPMembersundertakestofulfilorders.

3.7.3 SalestoCustomerswithintheEuropeanUnion

ForcustomerswithintheEuropeanUnion,theperiodforfulfillinganordershouldnotbegreaterthan30daysunlessagreedotherwisewiththecustomer,butseeparagraph3.7.5.

Ifitbecomesclearthatanordercannotbefulfilled(includingreceipt ofthegoods)withintheperiodstatedintheoffer,theDSPMemberwillofferwithin30days:

• arefund;• asubstituteofatleastequalvalue,givingdetailsaccordingly;or• ifthecustomerelectstowaitfortheoriginalorder,heshouldbegivenafirmdatefor

despatch.

3.7.4 SalestoCustomersoutsidetheEuropeanUnion

InthecaseofoffersforsalemadetocustomersoutsidetheEU,despatch fromtheUKwilltakeplacewithin30daysofreceiptofanorder(seeparagraph3.7.5)unlessagreedotherwisewith thecustomer.Suchanorder isdeemed tobe fulfilledwhen thewinesorderedhavebeeneither(a)deliveredunderthecustomer’sinstructionsor(b)inthecaseofashipmentarrangedbytheDSPMember,deliveredtothedesignatedforwardingagent.

Ifitbecomesclearthatanordercannotbedespatchedwithintheperiodstatedintheoffer,theDSPMemberwillofferwithin30days:

• analternativedatefordespatch;• arefund;or• asubstituteofatleastequalvalue,givingdetailsaccordingly.Ifthispossibilityisprovided

forintheoffer,andhavingreceivedthegoods,thecustomerthenwishestoexercisehis

4 For example, by receipt of invoice.

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rightofwithdrawal,thecostofinsuringthegoodsagainstdeterioration/damage,andofreturningthemwillbebornebythecustomer.

3.7.5 Goodssold‘en Primeur’

The30dayperiodforfulfillingacontractdoesnotapplytogoodsoffered‘enprimeur’:giventheextendedperiodbetweenpurchaseanddelivery,termswillbemadecleartothecustomerwhenanofferismade.

3.8 Jurisdiction

Incasesofdispute,thelawofEnglandandWaleswillapply.

4. CUSTOMER COMPLAINTS

20 20 4.1

4.2

4.3

Company Procedures

Referrals to the Wine and Spirit Trade Association

Monitoring Compliance with the Code

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4. CUSTOMER COMPLAINTS

4.1 Company Procedures

DSPMembersmusthave inplaceacomplaintshandlingsystem(i.e. internalproceduresfordealingwithcustomercomplaints)whichisfair,effective,confidential,easytouseandspeedy. Specifically, a complaints handling systemmust, as aminimum, adhere to thefollowingprocedures:

• inthecaseofE-Commerce,consumersmustbeabletomakeaninitialon-linecomplainttotheDSPmemberviaaneasytouse“clickthrough”mechanism;

• theremustbe inplaceeffective in-houseprocedures forhandling complaints throughcustomerservices,oranamedindividualwhoisresponsibleforcomplaints/enquiriesandwhohastheauthoritytoresolvecomplaintsandanswerenquiries;

• complaintsmustbeacknowledgedpromptly,andnormallywithinfiveworkingdays.Ifthecomplaintiscomplicatedandwilltakelongertoresolve,thenatthistimedetailsmustbegivenastothelikelytimescaleforresolvingthecomplaint;

• appropriateactionmustbetakentoresolvecomplaints,suchasensuringthatthegoodsorserviceshavebeendelivered/replacedorarefundgiven.

4.2 Referrals to the Wine and Spirit Trade Association

WhereacomplaintaboutimplementationofTheCodecannotsatisfactorilyberesolvedorwhereacustomerspecificallyrequestsit,DSPMembersmustdirectcomplaintstotheWine&SpiritTradeAssociation.

TheWineandSpiritTradeAssociationwillreferthemattertoasubgroupoftheDSPwhichwillincludetheDSPmembercomplainedagainst,theDSPChairman,DeputyChairmanandoneotherDSPmember.

ThisGroupwillexaminethereasonsforthecomplaintand,ifnecessary,seektorectifytheproblem(anditsrootcauses)withinanagreedtimeframe,andreporttotheDSP.

Afterconsultationwiththecustomer, if thecomplaintcannotberesolvedwithinanagreedtimeframethepartiestothedisputewillbereferredtoAlternativeDisputeResolution(ADR)asadvisedbythePresidentorVicePresidentoftheCharteredInstituteofArbitrators:

IntheeventofthecomplaintresultingfromapersistentandfundamentalbreachoftheCode,theGroupwillreferthematterto:

• theDSPwithaviewtopossibleexpulsionoftheoffendingmemberfromthePanel,and

• theAssociation’sExecutiveboardwithaviewtopossibleexpulsionfromtheWSTA.

4.3 Monitoring Compliance with the Code

TheSecretarytotheDSPshallmonitorcompliancewiththeCode.

5. SECURITY PROCEDURES (Company systems)

Security Standards

DSP Members obligations 5.2

5.1

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5. SECURITY PROCEDURES (Company Systems)

5.1 ItisrecommendedthatDSPMembersuseBS7799(Code of Practice for Information Security Management)asabasisfortheirsecuritystandards.

5.2 DSPMembersmust:

• provideeasy-to-use,securepaymentmechanisms,andmustgiveclearinformationonthelevelofsecuritysuchmechanismsafford;

• ensurethatasecuritypolicyfortheirsystemshasbeendevelopedandreviewed;

• identifyanindividualwhoisresponsibleforthesecurityoftheCompany’ssystems.His/herresponsibilitiesshouldinclude:

» scheduledreviewsofthesecuritysystem

» ensuring that changes to the system (including maintenance and disposal ofcomponentpartsofthesoftwareandhardware)aremadeinasecuremanner.

» ensuringthatsecurity-criticalchangesrecommendedbythesupplierofthesystemoranyofitscomponentsaremadeinasecureandtimelymanner

• assuretheintegrityofthecontentavailableonitswebsite;

• assuretheintegrityandconfidentialityoftransactionsandtheintegrityandconfidentialityofinformationaboutsuchtransactionswhetherstoredoncomputersorintransitacrossnetworksandagainstbothinternalandexternalthreatsandabuse.

• ensurethatcontractedthirdpartiesinvolvedinthefulfilmentofatransaction

• maintainanequivalentlevelofsecurityinrespectoftransactionsandinformationaboutsuchtransactions.

• ensure that, for the purposes of investigating a complaint or dispute andwhere theDSPhasa legitimateinterestin informationabouttransactions,thisinformationismadeavailabletoitinaccordancewiththeproceduresagreedbytheDSP.Similarly,correctproceduresmustbefollowedwhenreleasinginformationtoathirdpartyforthepurposesoflegalproceedings.

• takeallreasonablestepstoprotecttheDSP’slogoagainstmisuse;

• ensure that any contracting third party operating part of the service, operates inaccordancewiththerequirementsofTheCode.

6. PRIVACY PROCEDURES

6.1

6.2

6.3

6.4

6.5

6.6

6.7

6.8

6.9

Company Procedures

General Rules

Obtaining personal data

Objections

Suppression of Information

Mailing Lists rented-in

Mailing List rented-out

Transfer of lists to a third country

Unsolicited e-mail

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6. PRIVACY PROCEDURES (Company List and Database Practice) Inthissection,theCodeofPracticeappliestomailinglistsanddatabases(whetherelectronic

ormanual)whichareusedtomarketDSPMembers’productsandservices.Withregardtoobtainingand/orcompilingdata, theprocessing,managementandutilisationofdata,andtheaccuracyof listscontainingpersonal informationabout individuals,DSPMemberswillconformwiththeData Protection PrinciplessetoutintheData Protection Act 1998.

6.1 Company Procedures

6.1.1 DSPMemberswillhave inplaceappropriatemeasures toensure theprivacyofpersonaldata,inparticularwheretheprocessinginvolvesthetransmissionofdataoveranetwork,andagainstallotherunlawfulformsofprocessing.

6.1.2 Thecarryingoutofprocessingbyasub-contractorwillbegovernedbyacontractbindingthesub-contractortotheDSPMemberstipulatingthatthesub-contractorshouldactonlyoninstructionsfromtheDSPMember.

6.2 General Rules

6.2.1 EUDataProcessingLegislation:GeneralPrinciples

Although data-processing systems are designed to serveman, theymust, whatever thenationalityor residenceof thedatasubject, respecthis fundamental rightsand freedoms,notablytherighttoprivacy,andcontributetoeconomicandsocialprogress,tradeexpansionandthewellbeingofindividuals.

6.2.2 Personaldatawillbeprocessedonlyifatleastoneofthefollowingconditionsismet:

• thecustomerhasgivenhisconsent(see6.3.4);or

• processingisnecessaryforfulfillingtheorder.

6.2.3 AccuracyofInformation

• DSPMemberswilltakeallreasonablestepstoensurethattheirlistsareaccurateandup-to-date,thattheyavoidduplicationofmailingstothesamenameandaddress,andthatpromptactionistaken,uponcustomerrequest,tocorrectpersonalinformation.

• NotificationofthedeathofanindividualheldonaDSPMember’smailinglistshouldbeacteduponassoonaspossibletostopallfuturemailings.Inappropriatecases,thelistusershouldpromptlyreferthenotifierofthedeathtotheMailing Preference Service

• DSPMemberswhorenttheirliststothirdpartieswillsatisfythemselvesthattheusetowhichtheirlistisput,andanyliteratureusedinthepromotion,conformsbothtothespiritandtheletteroftheData Protection Code of Principles.

6.2.4 Maintenanceofrecords

• DSPMemberswillmaintainrecordswhichpermitofficialrequests(ie,fromthe Information

25


Commissioner),forthesourceofmailingliststobeidentified:suchinformationwillbesuppliedpromptly.

• At all times, personal information will be held securely and safeguarded againstunauthoriseduse,disclosure,alterationordestruction.

6.2.5 RightofAccess

Provided that the request for informationsentbye-mailoranyother ‘durablemedium’ isnotunreasonable,acustomerwillhavetherighttoobtainfromtheDSPMemberwithin40workingdays:

• confirmationastowhetherornotdatarelatingtohimarebeingprocessed;• therecipients(orcategoriesofrecipients)towhomthedataaredisclosed;• communicationtohimofthedataundergoingprocessing;• knowledgeofthelogicinvolvedinanyautomaticprocessingconcerninghim.

6.3 Obtaining Personal Data

TheDSPMembermust take responsibility forallpersonal informationobtained,heldandused.

6.3.1 PurposeforwhichtheDataisIntended

TheDSPMember or the data user (if they are different) should ensure that the generalpurpose forwhichpersonal information - includingan individual’s nameandaddress - isbeingsuppliedshouldbetransparentlyclearwhenand/orwherearequestfordataismade.

Inparticular,theDSPMember(orthedatauser)mustprovidethecustomerwiththefollowingdata,exceptwherehealreadyhasit:

• theidentityoftheDSPMember(orofthedatauser);

• otherfurtherinformationsuchas:

therecipients(orcategoriesofrecipients)ofthedata,andanyintendeddisclosuretoothercompaniesincludingthoseassociatedwith,orformingpartofthesamegroup,wheresucharelationshipiseithernotobviousornotgenerallyknown;

whetherrepliestothequestionsareobligatoryorvoluntary;

theexistenceoftherightofaccesstoandtherighttorectifythedataconcerninghim;

therighttorefusearequestforthedirectmailingofinformationabout‘similarproducts’;

specific reference to the collection of information through ‘cookies’ and trackingtechnologies.

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6.3.2.ObtainingDatafromaDirectResponseAdvertisement

DSPMembersobtainingpersonal information throughdirect responseadvertisementanddirectmailmay use such information tomake follow-up offers, exceptwhere specificallyexcludedbyasubsequentsuppressionrequest.

6.3.3 UseofDatainthePublicDomain

Published personal informationwhich fallswithin the public domain can be usedwithoutinformingtheindividualsconcernedinadvance,providedthatsuchinformationisnotlistedontheMail Preference Service (MPS) Suppression File.

6.3.4 UseofDataforotherPurposes

• Whenitisproposedtousepersonalinformationforapurposesignificantlydifferentfromthatforwhichitwasoriginallyintended,thedatasubjectshouldbeaskedforhisinformedconsentbeforefurtherprocessingcancontinue.

• DSPMembersusingandsupplyinglistsareresponsibleforensuringthattheliststheyuseormakeavailabledonotincludeindividualswhohaveobjectedtotheuseoftheirnames.

• The processing of personal data revealing racial or ethnic origin, political opinions,religiousorphilosophicalbeliefs, tradeunionmembership,andtheprocessingofdataconcerninghealthorsexlifeisnotallowed.

6.4 Objections

• Customershave the right toobject, on requestand freeof charge, to theprocessingof personal data for thepurposesof directmarketing.Theyalsohave the right tobeinformedandtheirconsentobtainedbeforepersonaldataaredisclosedforthefirsttimetothirdpartiesorusedontheirbehalfforthepurposesofdirectmarketing.

• AllDSPMembersshouldbeabletoidentifythoseindividualsontheirmailinglistswhohaveobjectedtothemregardingtheuseoftheirdata.DSPMemberswhomaketheirlistsavailable to thirdpartiesshouldbeable to identify individualswhohaveobjectedtotheirpersonalinformationbeingusedorwhohavenotbeengivenanopportunitytoobject.

6.5 Suppression of Information

• DSPMembersholdingdatabasesand/orusing rented-in listswill respondpromptly torequestsfromindividualsforsuppressionofanyoftheirpersonalinformation.

•• Requestsmadeby individuals to receiveno furtherpromotionalmailings fromaDSP

Membercompanywillmeetwithimmediatecompliance.

6.6 Mailing Lists Rented-in

6.6.1General

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In cases where lists are rented-in for processing, DSP Members will 5disclose to theircustomers:

• theidentityoftheDSPMember;

• thepurposeoftheprocessing;and

• anyfurtherinformationsuchas:

thecategoriesofdata(seeparagraph6.3.1);ortheexistenceoftherightofaccesstoandtherighttorectifythedataconcerninghim.

6.6.2 MatchingtheCustomertotheProduct

Members renting-in lists will use their best endeavours to ensure that the category ofindividualsisnotinappropriatetotheproductorserviceonoffer,particularlywherespecificcriteria(e.g.ageorincome)mustbesatisfied.

6.6.3 AccuracyofData

• Inordertoensurethatrented–inlistscontainthelatestcorrectionsandsuppressions,theintervalbetweenthedateofsupplyofthelistandthedateofmailingsshouldpreferablybenolongerthan90daysbutshouldnotexceedsixmonthsunlesssuppressionsand/orcorrectionshavebeenincorporated.

• If individuals included on a rented-in list request corrections to inaccuracies in theirpersonaldata,theDSPMemberwillinformthelistownerwithinsixtydays.

6.6.4 SuppressionofData

Ifindividualsincludedonalistrequestthelistusertorefrainfromfurthermailings, their nameswill be suppressed from that and, if possible, any subsequent listsrented-in.

6.7 Mailing Lists Rented-Out

6.7.1 DSPMembersrenting-outtheirlistsshouldensurethatprospectivelistusers:

• giveanassurancetoobservetherequirementsoftheData ProtectionPrinciples bothinitsgeneralandspecificrules;

• satisfythemthattheformandcontentoftheintendedmailingconformswiththegeneralrequirementsoftheData ProtectionPrinciples;

• eitherreturnthelisttotheDSPMemberorincorporatesuppressionsand/orcorrections,ifthedistributionofthemailingisdelayedbymorethansixmonths;

• passbacktothemallrequestsforcorrectiontoanindividual’sdatawithin60daysoftheirreceipt.

5 Full disclosure will be made to a customer before data is made available to a third party. However, this is not necessary if the customer is already in possession of the facts to be disclosed.

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MembersandtheirlistbrokersshouldensurethatanyconsumerlistofferedforrentalisnotusedunlessitisrunagainsttheMail Preference ServiceSuppression File.

With regard to list rental, Members should hold records to demonstrate compliance with therequirements of Data Protection Principles and make these available, upon request, to theAdvertising Standards AuthorityandtotheCommittee of Advertising Practice.

6.8 Transfer of Lists to a Third Country

ADSPMembermust not transfer lists for processing to aThirdCountry (ie any countryoutsidetheEU)unlessithasbeenconfirmedthattheThirdCountryensuresanadequatelevelofprotection,seeEUDirective95/46/ECArticles25&26.

DSPMembersintendingtotransferdatatoaThirdCountrywhichisnotconsideredtohaveanadequatelevelofdataprotectionmustdrawupacontractwithdifferentrecipientsofthedataunless:

• theindividualhasgivenanunambiguousconsenttothetransfer;and

• thetransferisnecessaryfortheperformanceofacontractbetweentheDSPMemberandtheindividualorfortheimplementationofpre-contractualmeasurestakeninresponsetoarequestfromtheindividual.

6.9 Unsolicited e-mail

• Unsolicitede-mailmustbeclearlyidentifiableassuch;

• DSPMembersmustnotsendrandom,untargeted,unsolicitedcommerciale-mail

• DSP Members must use appropriate e-mail preference services and must not sende-mailcommunicationstoindividualswhohaveregisteredobjectionstoreceivingsuchcommunications;

• Unsolicitede-mailmustincludeamechanismfortheconsumertoregisteranobjectiontoreceivingfurtherunsolicitedcommunications.

• DSPMembersmustclearlyidentifytheorganisationonwhosebehalfanelectronicmailcommunicationforthepurposesofdirectmarketinghasbeentransmitted.

7. CUSTOMER RECRUITMENT ADVERTISING

7.1

7.2

7.3

Media

Support for other UK Codes of Practice

Rules

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7. CUSTOMER RECRUITMENT ADVERTISING

7.1 Media

TheCode’srules(seebelow)applytoadvertising:

• ontheinternet,whetherthroughonlineorwirelesscommunicationdevices;

• onviewdataservices;

• TV-shoppingmedia;

• innewspapers,magazinesandotherprintedpublications;

• materialsuchasbrochuresandleaflets,whetherthesearemailedordelivereddirectly,orreachtheirpublicasinsertsinnewspapersorotherpublication,throughdistributioninshopsoratexhibitions,orinotherways.

7.2 Support for other UK Codes of Practice

DSPMemberssupportthePortmanGroupCodeofPracticeontheNamingPackagingandMerchandisingofAlcoholicDrinks,andadhere to theBritishCodeofAdvertisingPracticerulesontheadvertisingofalcoholicdrinks(iethatinappealingtothosewhobuyandenjoyalcoholinmoderation,advertisementsshouldavoidanythingthatcanreasonablybeseenaslikelytoleadtotheadoptionofstylesofdrinkingthatareunwiseforthedrinkersorasourceofsocialandmedicalproblemsforthecommunity).

7.3 Rules

7.3.1. Advertisementsshouldbesocially responsibleandshouldnotencourageexcessivedrinking.Inparticular,theyshouldnotexploittheyoung,theimmature,orthosewithmentalorsocialincapacities.

7.3.2 Advertisementsshouldnotbedirectedatpeople under the age of 18,whetherbyselectionofthemediumorcontextinwhichtheyappear,orbyreasonoftheirstyleorpresentation.

7.3.3 Noadvertisementshouldfeatureanycharacters, realorfictitious,whoarelikely,whetherbecauseoftheirapparentyouthorotherwise,toattracttheparticularattentionoradmirationofpeopleunder18andthereby,inanyway,toencouragethemtodrink.

7.3.4 Peopleundertheageof18shouldnotappearinadvertisementsexcept whentheirpresencewouldbeneitherillegalorunusual;forexample,asparticipantsinsucheventsasfamilycelebrations.Whentheyaresoshown,itshouldalwaysbeobviousthattheyarenotdrinking.

7.3.5 People shown drinkinginadvertisementsshouldalwaysclearlybeadults,andtoensurethatthisimpressioniscreated,advertisersshouldnotengageasmodelspeopleunder25,orpeoplewholookastheymaybeunder25,ifthesepeoplearetobeshowninanyadvertisementeitherdrinkingorabouttodrink.

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7.3.6 Advertisementsshouldnotsuggestthatdrinking,orthechoiceofaparticulardrink,leadstosocial acceptanceorpopularity,orthatalcoholisthemainreasonforthesuccessofanyeventoroccasion.

7.3.7 It is legitimatetopromotetheconsumptionofparticulardrinksonparticularoccasions,orunderparticularcircumstances(forexample,Champagneatcelebrations),butifthisisdone,theadvertisermust takecarenot toallow the implication tobedrawn that thechoiceofagivendrink isanythingmore thanevidenceof thegood tasteof thedrinker– that, forexample,itcanmakehimorherbetterlikedormoresuccessfulthanthosewhodonotdrink,orwhodrinksomethingelse.

7.3.8 Noadvertisementshouldbecapableofbeingunderstoodasachallengetopeopletodrink.Inparticular,suggestionsthatdrinkingisanessentialattributeofmasculinityshouldbeavoided,asshouldanythingwhichsuggeststhatthebrave,thetoughandthedaringowethesecharacteristicstotheirdrinking.Noadvertisementforadrinkshoulddepictorrefertoitinthecontextofaggressive oranti-socialbehaviour.

7.3.9 Noadvertisementshouldsuggestthatthefemininityorattractivenessofwomenisenhancedbydrinkingorbythechoiceofaparticulardrink.

7.3.10 Advertisementsshouldnotsuggestthatimmoderate drinking,howeverportrayed,issensible,admirableoramusing. Particularcarerequirestobetakenwithadvertisementsforsalespromotionswhichrequiremultiplepurchases.

7.3.11 Advertisementsshouldavoidanyimplication,particularlywhenshowingmenandwomentogetherthatalcoholgenerally,oraparticulardrink,offersthekeytosuccessinpersonal relationshipsofanykind,orthatitcanmakedrinkersmoreattractiveorsuccessfulinsuchrelationshipsthannon-drinkers,orthosewhodrinksomethingelse.

7.3.12 Advertisementsfordrinkshouldnotsuggesttheenhancement of mental ability or physical capacity. Inanyadvertisementwhichfeaturessportsmen,particularcareisrequiredtoavoidthe implicationbeingdrawn that theirperformance,orsuccess, is related to theiralcoholconsumption.

7.3.13 Advertisements should not suggest that drink has therapeutic properties or that it canresolvepersonalproblems;inparticularthatitisacceptabletouseitasameansofremovinginhibitions,resolvingtensionorsoothingagitation.Advertisementsshouldnotsuggestthatregularsolitarydrinkingisadvisable.

7.3.14It islegitimatetobaseanadvertisementupontheabilityofanalcoholicdrinktoslakethedrinker’sthirst.

7.3.15 Advertisements should not depict activities or locations in connection with which theconsumptionofanydrinkwhateverwouldbeunsafeorunwise.Particularcarerequirestobetakenwithadvertisementswhichdepictpoweredvehiclesofanykindandespeciallymotorcars.

Annex B

THE DISTANCE SELLING CODE LOGO


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ANNEX B - THE WSTA DISTANCE SELLING CODE LOGO

ItisaconditionofusethattheWSTADistanceSellingCodeLogoshallnotbeusedinanyprintedadvertisementsorprintedpublicitymaterialdirectedprimarilytothemarketintheUnitedKingdomandintheIsleofManorinretailpointofsaledisplaycardsdistributedbytheRegisteredProprietorforusewithintheUnitedKingdomandintheIsleofManwithoutindicatingthatitisaCollectiveMark.

SignatoriestotheWSTADistanceSellingCodemayuseanyofthefollowinglogos:

Annex C

CODE OF PRACTICE ACCEPTANCE FORM


35

ANNEX C – CODE OF PRACTICE ACCEPTANCE FORM

TheDistanceSellingCodeofPracticewasadoptedbytheDistanceSellingPaneloftheWSTA.

InordertousetheWinebyMaillogo,memberscompaniesareaskedtoconfirmthattheyacceptthetermsoftheCodeandabidebyitinalldealingswithcustomers.Pleasewouldyouindicateyourcompany’sacceptanceoftheCodebysigningthisletterandreturningittotheAssociation.

WSTA DISTANCE SELLING CODE OF PRACTICE

IconfirmthatmycompanyabidesbytheWSTADistanceSellingCodeofPracticeadoptedbytheWSTADistanceSellingPanel.

COMPANY……………………………………………………………….

NAME ……………………………………………………………….

POSITION ……………………………………………………………….

CONTACTNUMBER ……………………………………………………………….

EMAIL ……………………………………………………………….

SIGNATURE …………………………………………………………

DATE …………………………………………………………

Annex D

GUIDE TO THE EN PRIMEUR WINE

MARKET


37

ANNEX D - GUIDE TO THE EN PRIMEUR WINE MARKET TheDistanceSellingPanelproducedaguideaimedatconsumerswishingtoinvestinEnprimeurwinestoadviseofthecheckstheyshouldmakebeforeinvestinginwine.Thechecklistisdesignedtoprotectbuyersfromtheriskofwinefraud.Membersareadvisedtoreproducethisadviceontheirwebsitesand/orusealinktotheWSTAwebsite.

• Whatisenprimeur?• Howdoesitwork?• Whybuyenprimeur?• Whydoproducerssellenprimeur?• Whenareenprimeurwinesdelivered?• Whenispaymentdue?• Istherearisk?• Checklist-askthesequestionsaboutthemerchantofferingenprimeurwine

What is en primeur?

Enprimeur, or openingofferwines, refers to the releaseandsaleofwinebygrowersand theirmerchantsbeforetheyarebottledandreadyforphysicaldelivery.Themainareasthatareregularlyinvolved in this process areBordeaux, Burgundy and theRhône; and vintagePort. Thewinesthemselvesaredeliveredsometimeaftertheenprimeursaleduringwhichtimethewinescompletethematurationprocess,usuallyinbarrels.Theyarethenbottledbeforefinallybeingdeliveredtothemerchantandbecomingavailabletothecustomer.

How does it work?

Typicallywinemerchantswillbeinvitedtotastewineswhiletheyarestillmaturing,andsometimebeforetheyarereadytodrink.Theirexperienceenablesthemtosayhowtherawwinethattheyaretastingwilltastewhenitisafinishedproduct,andjudgewhetherthewineisworththepricethatthegrowerisaskingforit,eventhoughittastesquitedifferentfromthefinaldrinkablewine.Thewinemerchantoffersthewinesitselectstocustomersintheformofapromisetodeliverthatwinelater,atafixedpricenow.ThispriceexcludesUKExciseDutyandVAT.Ifthecustomerchoosestobuy,hepaysthemerchantandaninvoiceisraisedwhichstatesthatthecustomerhasarighttothewineatafuturedate.OftenmerchantsalsoissueannualstatementsconfirmingthewinesthathavebeenpaidforandwhenthosewinesarelikelytobedeliveredtotheUK.

Whenthemerchantfinallyreceivesthebottledwine,thecustomerhasvariousoptions.Hecantakepersonaldelivery,paytheUKExciseDutyandVATandstore,drinkorsellthewinesashechooses.Manycustomersprefertohavethewinestoredbymerchantsorspecialistsratherthanathome.Thiscanbe“underbond”whichmeansthatthepaymentofDutyandVATisdelayedwhilethewineisinaproperlyregisteredandcontrolledwarehouse.OthermerchantsasktheircustomerstopaytheDutyandVATwhenthewinearrivesintheUKregardlessofwhethertheytakepersonaldeliveryorstorethewinewiththem.

Why buy en primeur?

Demandforsomewinescanexceedtheirsupply,and it ispossible thatallofagrower’swine issold before it is bottled. It can thenbe very difficult or expensive to obtain thatwineat a laterstage.Inaddition,buyingenprimeurgivesassurancesabouttheprovenance,sincethecustomeriseffectivelybuyingdirectlyfromthegrower.Thecustomercanalsobecertainoftheconditionsinwhichitisstored;buyingatalaterstage,perhapswhenthewineisreadytodrinkmanyyearslater,


38

doesnotenablecontroloftheseconditions.Thecustomeralsohastheabilitytospecifythebottlesize.Finally,ithasbeenthecasethatfinewine,inlimitedsupply,hasincreasedinprice.

Customershavebeenabletosellataprofit.Itmustbesaid,however,thatthereisnoguaranteeofthis,andthepriceofwine(asinthecaseofmanyotherassets)canfallaswellasrise.Ratherlikeart,itisgoodadvicetobuywinethatyouwillenjoy,ratherthancountonitappreciatinginvalue.

Ontheotherhandtherearerisksandcostsassociatedwithbuyingwineenprimeur.Thefirstoftheseisthatthewinemaynotturnouttobeasgoodasprojectedbythemerchant.Secondly,moneyistiedupwhilethewinematureswhenitcouldbeearninginterest.Thirdly,moneyhasbeenpaidtoamerchant,andbythemerchanttoagrower,withouttakingpossessionoftheproductitself.

Why do producers sell en primeur?

Thebigadvantageforproducersisliquidity.Withoutthisearlysaletheywouldrequiremorecapitaltofinancetheiroperationswithoutincomeforseveralyears.Sellingenprimeurmeansbettercashflow.

When are en primeur wines delivered?

Thisvariesbyregion.ThelargestregionisBordeauxandtheenprimeurofferofthepreviousyear’svintageistypicallymadeinJuneofthefollowingyear.Deliveryofthebottledwinewillthentakeplace18monthstotwoyearslater(i.e.about2½yearsaftertheharvestorvintage).SomecustomerswillpayDutyandVATshortlyafter thewinesarrive in theUK;otherswilldelaythispaymentandmayevensellthewinewithoutpayingDutyandVAT(inotherwordswhileitisstillstoredinbond).

When is payment due?

Subjecttoawinemerchant’stermsandconditions,paymentisduewhenthecustomer’sorderisacceptedbythemerchant.Somemerchantshaveclosingdatesfortheirenprimeurcampaigns,andifdemandexceedssupplytheywillallocatethewine,perhapsbyballot.Othermerchantssellona“firstcome,firstserved”basis.Inallcasespaymentisasignificanttimebeforedelivery.

Is there a risk?

Winepricescan fallaswellas rise. Winescan turnout tobe lessattractive thanexpected. Inadditionthereisaclearriskinpayingforaproductwhichisdeliveredaconsiderabletimelater,andtherehavebeeninstanceswhereamerchanthassoldmorewinethanhehasmanagedtoobtainfromthegrower.Somepeoplewill thenbedisappointed!Therehavealsobeenbankruptciesofmerchantsorgrowersbetweenthetimeofpaymentanddeliveryofthewine,andasaconsequencecustomershavenotbeenabletoobtaindeliveryofthewinethattheypaidfor.Itisalsopossiblethatagroweroversellshisoutput,andwhenthetimecomestodeliverisnotabletodoso,despitehavingbeenpaidbythemerchant.

Therehavebeeninstancesoffraudandnon-deliveryofwine,despitethepaymentandcontracts.

Sotherecertainlyareriskstobuyingwineinthisway.However,dealingwithareputablemerchantcanreducetheseconsiderably.


39

Checklist – ask these questions about the merchant offering en primeur wine:

• Considerthesizeandreputationofthemerchant.Large,establishedbusinessesaremuchless likely to suffer bankruptcy or engage in dubious trading; they will be independentlyauditedandtheiradministrationwillbemoreprofessionalandsubjecttochecks.

• Howlonghasthebusinessbeentrading?• Howmuchcashandotherassetsdoes thecompanyhavecompared to theirenprimeur

purchases?• Whatistheturnover,creditratingandnumberofemployees?• Howisthemanagementsupervised?• Considerwhether themerchantoffersguaranteesorcarries insurance. Somemerchants

ensurethatifagrowerdoesnotdeliverthewineasarrangedthatfundsarereturnedtothemerchantandsotothecustomer,throughabankguaranteeorinsurance,orwineobtainedfromanothersource.

• Doesthemerchantownthewineheisofferingforsale,ordoeshejusthopetobuyitfromthegroweroncehehasyourorder?

• Arepricescompetitive?Dotheyincludedelivery?• WherecantheybestoredoncedeliveredtotheUK?Arethesefacilitiessecureandclimate

controlled?Whatistherentalchargeanddoesthisincludeinsurance?• Whatpaperwork,suchasinvoicesandstatements,willyoureceivetoensurethatyoucan

proveyourentitlementtothewinethatyouhavepaidfor?• Isthetitletoyourwineclearlyestablished,throughlabellingand/orstatementsandinvoices?• Isyourwinestoredseparatelyfromthecompany’sownwine?

Annex E

GUIDE TO WINE INVESTMENTS:

CAPITAL GAIN TAX AND INHERITANCE TAX


41

ANNEX E: GUIDE TO WINE INVESTMENTS: CAPITAL GAIN TAX AND INHERITANCE TAX

AdvicefoundinthepublicdomaininrelationtoInheritanceTax(IHT)andCapitalGainsTax(CGT)asfarasfinewineisconcernedvaries,greatlyandleadstoconfusionforbusinessesandconsumers.Thedocumentisprovidedasguidanceandaimstoclarifythesituation.

1/ Inheritance Tax: wine valuation

SometradersandconsumersmayhavebeenleadtobelievethatforInheritanceTaxpurposeswineisvaluedatthepurchasepriceratherthanthevalueatthedateofdeath.HMRCrecentlyconfirmedthatthiswasincorrectandthatforIHTpurposesthevalueofanypropertyisthepriceitmightreason-ablybeexpectedtofetchifsoldintheopenmarketatthattime.

HMRC’s clarification published in August 2010:‘Ithasbeenbrought toHMRC’sattention that information in thepublicdomain indicates that forInheritanceTaxpurposeswinecellarsarevaluedatthepurchasepriceratherthanthevalueatthedateofdeath.Thisisincorrect.

Section160IHTA1984statesthatforInheritanceTaxpurposesthevalueofanypropertyisthepriceitmightreasonablybeexpectedtofetchifsoldintheopenmarketatthattime.

ThereforeitisclearthatawinecellarmustbevaluedatitsopenmarketvalueforInheritanceTaxpurposesatthetimeoftherelevantoccasionofcharge.’

LegaladvicereceivedbytheWSTAhasalsoconfirmedthisinterpretation.

References:InheritanceTaxAct1984-Section160http://www.hmrc.gov.uk/ihta/part_6_chapter_1/ihta160.htm#TopOfPageHMRCTrustsandEstatesNewsletterAugust2010:http://www.hmrc.gov.uk/cto/newsletter-aug10.pdf

2/ Capital Gains Tax (CGT)

Dependingoncircumstances,finewinemayormaynotattractCGTwhenitisresold.Afterreceiv-ingnumerousqueriesonthesubject,thefollowingguidancewasissuedbyInlandRevenue(nowHMRC)initsTaxBulletin42:

‘Wherebottledwineispurchased,eachbottleisachattelforCapitalGainsTaxpurposes.AsgainsonthedisposalofchattelswhicharealsowastingassetsaregenerallyexemptfromCapitalGainsTax,Section45(1)TaxationofChargeableGainsAct1992(TCGA),thenthefirstquestioniswhetherbottledwineisawastingassetornot.

ForCapitalGainsTaxpurposesawastingassetisonewhosepredictablelife,fromthepointofviewofthepersonacquiringit,doesnotexceed50years,Section44(1)TCGA.Whilstthis definition would clearly apply to cheap table winewhichmayturntovinegarwithinarelativelyshortperiod,eveninunopenedbottles,ourviewisthatit would certainly not apply to port and other fortified wineswhicharegenerallyrecognisedtohaveaverylongstoragelife.

Betweentheseextremes,thereareanumberoffinewineswhicharequitedrinkableafterasubstan-tialperiod[…].Withthesethebasicconsideration[…]iswhetherthewinehasturnedtovinegaror

http://www.hmrc.gov.uk/ihta/part_6_chapter_1/ihta160.htm#TopOfPage

http://www.hmrc.gov.uk/ihta/part_6_chapter_1/ihta160.htm#TopOfPage

http://www.hmrc.gov.uk/cto/newsletter-aug10.pdf


42

hasmerelymatured.[…]inpractice,mostwineisdrunkwellbelowtheageof50yearsandinthatsenseitisverydifficulttoconsidertheissueinisolation.

However,wherethefactsjustifyit,wewouldnormallycontendthatwineisnotawastingassetifitap-pearstobefinewinewhichnotunusuallyiskept(orsomesamplesofwhicharekept)forsubstantialperiodssometimeswellinexcessof50years.Ifaparticularbottleofwineisnotawastingasset,thenanygainaccruingonitsdisposalmaynever-thelessbeexemptwherethedisposalproceedsforthatsinglebottledonotexceed£6,000,Section262(1)TCGA.

Wherehowever,anumberofbottlesaresoldtothesamepersoninoneormoretransactions,thenthequestionmightariseastowhetherthebottlesthemselvesconstitutea“set”.Iftheydo,thenthe£6,000limitwouldapplytotheoverallsaleproceedsratherthanthepricefetchedforanyindividualbottle,Section262(4).Thisisaquestionoffactandwoulddependon:

(a)whetherthebottlesare“similarandcomplementary”-whichwouldrequirethewineinthemtohavebeenproducedfromthesamevineyardinthesamevintageyear,and(b)whetherthebottlesareofgreaterworthwhensoldcollectivelythanwhensoldindividually’.

Reference:http://www.hmrc.gov.uk/bulletins/tb42.htm

3/ Wine valuations: CGT exemption does not apply to IHT

TherehasbeenconfusionaboutthefacteventhoughsomewinesmaynotattractCGT,theymaystillattractIHT.HMRC’sTrustsandEstatesdepartmentofferedthefollowingadviceinNovember2010:

‘CGT&IHTaretwoseparatetaxesandthepositionforIHTcannotbeexpressedanymoreclearlythanitwasinourAugustNewsletter.WhilstitmaybethecasethatsomewinesdonotattractCGT(thatthisisbecausetheyareconsidereda“wastingasset”),thereisnoequivalentexemptionforIHT.

Putverysimply,IHTischargedontheopenmarketvalueofalltheassetsthatsomeoneownswhentheydie-andifthatincludesawinecellaroraninvestmentinwine,itwillbetheopenmarketvalueofthewineatthedateofdeaththatisliabletoIHT.’

http://www.hmrc.gov.uk/bulletins/tb42.htm

Annex F

DISTANCE SELLING FRAUD PREVENTION

GUIDELINES


44

ANNEX F: DISTANCE SELLING FRAUD PREVENTION GUIDELINES

Thisdocumentaimsat listing themost frequentlyencountered typesof fraud, the things to lookout forandpossiblepreventionmethodstouse.Youwillfindundereachsubjectheadera listofcommonlyusedfraudulentpractices.ThemainfocusisonDistanceSellingorders,thoughsomeofthepracticesarealsousedinfacetofacetransac

1/ Things to look out for:

Contact details• Onlyamobilenumberandawebbasedemailaddressareprovided• Wrongtitlesareusedwithcontactnames(e.g.MrJaneSmith)• Badspellingandgrammar• Deliveryaddressdoesnotmatchthebillingaddress• Deliveryaddresstoanexistingbusinessbuttosomeonenotlistedasanemployee• Deliveryandcontactsdetailsbasedinpostcodeswherefraudulentactivityishigh• DeliverytoaPObox• Orderfromhighriskcountries

Product Type• Certainproducts tend to attract fraudsters, due to their high resale value.Products such

asChampagne,BordeauxwineandSpiritsareallrelativelyhighvalueproductsandhavethereforeahighresalevalue

Order Value• Ordersoveracertainvaluemaybefraudulent.Businessmaywishtosetanorderthreshold

abovewhichadditionalverificationmaybetriggered

Order Type • Highvalueordersforsamedayornextdaydeliveryhavetobetreatedcautiously.• Ordersover thephonetobecollected instorearealsorisky. Ifsomeoneiscollectingthe

orderinstore,thenrequiringthecardholdertobepresentisanadditionalsafeguard• Orders on behalf of a business or awell known institution (e.g. theBBC) for immediate

deliveryarealsocommonscams.• Orderfromoverseas

Order Format• Spellingmistakes• Badgrammar• Wrongtitleforcontact(e.g.MrsJohnSmith)• Ordersentfromaweb-basedemailprovider• Changestothedeliverymadeatthelastminute

Delivery types• Veryshortdeliverytimes• Customerinahurryorpersistent,requiringsamedaydeliveryorveryshortdeliverytime.

2/ Possible Prevention methods

• Checkcustomer’sorderhistory(existingornewcustomer?)


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• Usethirdpartychecks,real-timeauthorisationchecksormanualchecksiftheorderexceedsacertainvalueorisforcertaintypesofproductsthatareof‘highrisk’

• Askforlandlinenumberaswellasamobilenumber

• Useascorecardsystemwhichtriggersadditionalverificationandchecks(norisk,lowrisk,reasonableriskandhighriskaccordingtoordervalueandproducttype)

• Onlyacceptcertainpayment typesandmakesurepaymenthasclearedbefore releasinggoods

• Onlydelivertoaddressthat isdifferenttothebillingaddressif thecustomerhasanorderhistory

• Ifbusinessaddressisusedasanalternativeshippingaddress,oriftheorderisplacedonbehalfofawellknowninstitution,checkthatthecardholderworksthere

• UseGooglemaps’‘streetview’toviewthedeliveryaddressonline

• Followuponlineorderswithaphonecalltocheckthecontactdetails

• UseprivacynotesinTermsandConditionswarningpotentialfraudstersthatfraudulentactivitywillbereportedtothePolice,asfollows:‘For the purposes of the prevention or detection of offences, and/or the apprehension or prosecution of offenders, we may share any information that we collect with the Police, other public or private sector agencies or representative bodies in accordance with the relevant legislation. Information shared in this way will not be used for marketing purposes.”

Documents

Distance Selling Code of Practice for wines & spirits · All Merchants displaying The ... Practice which supports it fully reflect the modern era of global ... Distance Selling Code