ITPEC IP October 2024 Question 76

Topic: Legal Affairs

Among company’s actions A through C below, which of the following lists all and only the acts that may be problematic in terms of compliance?

A:In order to increase awareness of the name of a new product among consumers, a campaign is implemented where anyone can apply for a prize by answering a simple quiz that just asks a part of the product name is published widely in media such as newspapers, the relevant company’s website, and magazines, and one of the applicants is chosen at random to receive a prize of 100,000 yen.B:When a company received an order for an advertisement from an advertiser, the company posted an article on its popular website as a general article that favorably reviews a certain product without indicating that the article is an advertisement.C:A bag with a design inspired by France was manufactured domestically and was put on sale with a tag featuring a photograph of Paris and the French flag, but without noting the country of production.

Explanation

B and C — both mislead consumers: B hides that an article is an advertisement, and C suggests a French origin for a domestic product.

  • •A — an open prize campaign: anyone can apply without buying anything, the quiz is announced widely, and the winner is drawn at random. With no purchase condition this is not a premium tied to a transaction, and the prize amount itself is not the issue. Not problematic
  • •B — an advertiser-ordered article posted as an ordinary favorable review without disclosing that it is an advertisement is stealth marketing, a misleading representation. Problematic
  • •C — Paris photographs and the French flag on a domestically made bag, with no country of production shown, can lead consumers to believe it was made in France: a misleading indication of origin. Problematic

Answer (d)

Why not others:

  • •(a) A, B — includes the lawful open campaign and misses the misleading origin labelling in C
  • •(b) A, B, C — includes A, which imposes no purchase condition and misleads no one
  • •(c) A, C — includes A and misses the undisclosed advertisement in B

Key rule: Compliance in sales promotion is about not misleading consumers: disclose that advertising is advertising and do not imply a false origin, while an open prize campaign with no purchase condition is not a problem in itself.

Legal Affairs · AI-written, may contain errors

Practice this exam

This question comes from an official ITPEC past paper. ITPEC Practice is an independent study tool and is not affiliated with ITPEC. See the official IP past-paper collection or Report an issue.