© Springer-Verlag Berlin Heidelberg 2015Pierre Kobel, Pranvera Këllezi and Bruce Kilpatrick (eds.)Antitrust in the Groceries Sector & Liability Issues in Relation to Corporate Social ResponsibilityLIDC Contributions on Antitrust Law, Intellectual Property and Unfair Competition10.1007/978-3-662-45753-5_31
31. United Kingdom
Hogarth Chambers, London, UK
In addition to receiving the comments of the UK Competition Law Association, the author would like to thank Peter Malone of Clifford Chance (London) for his comments in relation to the discussion in Sect. 31.7. All errors and omissions remain those of the author.
31.1 CSR Policies Adopted by UK Undertakings
There are numerous types of policies that fall under the umbrella term of ‘corporate social responsibility’. The UK does not have any specific method of categorising CSR policies; however, they appear to fall into one of three distinct categories as set out below. These categories group CSR policies by looking at the aim of a given policy.
The first category of CSR policies comprises policies relating to any attributes that are intrinsic to the products/services offered by a company. Examples of this type of policy are:
companies making commitments about the environment, e.g. that the carbon footprint for a certain product does not exceed a stated amount;
companies making commitments over the working conditions of its staff or workers both domestically and overseas; this sort of policy would also include a commitment to providing foreign suppliers with a living wage (as in the case of Fair Trade products);
companies making commitments about the quality of their products, e.g. that they only use locally sourced produce.
The second category comprises policies where a company provides its own staff for work on projects that are outside the normal remit of the company in question. Examples of this type of policy include
companies allowing staff to undertake local community projects on company time;
companies sending staff into schools to educate children. This can be in relation to the market in which the company itself operates,1 or it could be something completely outside the scope of the company, such as helping children to learn to read. Put simply, this would cover any form of work that is seen as objectively beneficial and for the public good.
The third category includes policies whereby a company donates money (or something else of value, e.g. old equipment such as computers) to a charitable institution or to other community projects.
CSR policies can originate from one of three places—government regulation, the company themselves or NGOs. Of these three, only the last two types of CSR policies are considered in this report.
31.2 Categorisation of NGO Policies
NGO policies can also be broken down into two further categories. First are those policies that emanate from NGOs that are in some way associated with the industry in question, for example trade bodies. Second are those policies that emanate from NGOs that are truly independent of the industry, for example Greenpeace campaigning on environmental issues.
The key difference between an internally set policy and an NGO set policy is that with the NGO policy, there is potentially more accountability as the NGO will be, to different extents, outside of the control of the company.
31.3 Legal Rights That May Apply to Breach of a CSR Policy
Whether or not any of the above gives rise to legal concerns depends on how the policy is implemented and presented to the outside world. It is important to note that the way these policies are conveyed to the public varies tremendously, and this impacts upon whether or not they give rise to legal concerns. The promotion of CSR policies in the UK can be achieved by actual marking on products, through corporate statements or news reports, in company literature or through traditional advertising.
There is a patchwork of legal rights that may, under certain circumstances, give rise to a cause of action. These include trademark infringement, breach of contract, passing off and various statutory torts relating to advertising and trading standards.
31.3.1 Sanctions Under UK Law for Breach of a Voluntarily Adopted CSR Policy
There is no law in the UK aimed specifically at preventing or sanctioning a business that has breached a voluntarily adopted CSR.
The UK has a range of general IP laws and associated consumer protection laws that may provide for legal recourse against a company that breaches its own voluntary CSR policy. However, the applicability of these laws is entirely dependent on the policy in question, how the company has marketed this policy to the public and the manner in which is has been breached.
The terms of any given CSR policy play a crucial role in determining whether or not breaching it will provide for a legal remedy. The difference between a company saying that they ‘only use dolphin-friendly tuna’ and that they ‘endeavor to only use dolphin-friendly tuna’ is significant from a legal point of view: one is an absolute statement; the other a strong intention or commitment. The latter of these is considerably more difficult to police. It is therefore relatively easy for companies to word their CSR policies in a manner that would allow them to almost completely avoid the possible legal remedies set out below.
31.3.2 Consumer Protection from Unfair Trading Regulations 2008
The most relevant legal scheme is that governed by the Consumer Protection from Unfair Trading Regulations 2008 (hereinafter ‘CPUTR 2008’).2 This scheme applies where there is a misleading commercial practice that contravenes the requirements of professional diligence and materially distorts the economic behaviour of the average consumer.3
126.96.36.199 Legal Test for When a Commercial Practice Will Be Misleading
A commercial practice will be deemed misleading if it either:
contains false information and is therefore untruthful in relation to any of the matters set out below or if it or its overall presentation in any way deceives or is likely to deceive the average consumer in relation to any of the matters set out below, even if the information is factually correct, and it causes or is likely to cause the average consumer to take a transactional decision he would not have taken otherwise4; or
concerns any marketing of a product (including comparative advertising) that creates confusion with any products, trademarks, trade names or other distinguishing marks of a competitor,5 or it concerns any failure by a trader to comply with a commitment contained in a code of conduct that the trader has undertaken to comply with,6 if the trader indicates in a commercial practice that he is bound by that code of conduct7 and the commitment is firm, capable of being verified and is not aspirational.8
188.8.131.52 Factors to Be Considered Under the CPUTR 2008
The factors that fall under this scheme and that are to be considered include, inter alia:
the nature of the product,
the extents of the trader’s commitments,
the motives for the commercial practice, and
any statement or symbol relating to direct or indirect sponsorship or approval of the trader or the product.9