2 Introduction
2. On 29 April 2004 the Government laid before Parliament
a proposal for the Regulatory Reform (Trading Stamps) Order 2004
in the form of a draft of the Order and an explanatory memorandum
from the Department for Trade and Industry (the Department).[1]
3. The proposed Order would repeal the Trading Stamps
Act 1964 (the 1964 Act). It would also repeal section 1(2)(c)
of the Supply of Goods and Services Act 1982 (the 1982 Act), so
that the 1982 Act would in future apply in situations where goods
are exchanged for trading stamps. The proposal would also give
effect to various other minor consequential amendments and revocations.
4. Trading stamp schemes are a specific form of consumer
sales promotion in which customers are given redeemable tokens
("stamps") when making purchases from participating
retailers. These stamps are collected and then exchanged for
goods, either from the retailers' own shops or from showrooms
operated by the organizer, or promoter, of the trading stamp scheme.
Green Shield Stamps are the most well-known historic example
of a trading stamp scheme. Retailers wishing to provide customer
incentive schemes now tend to operate electronic reward card systems
involving the issue to customers of a loyalty card which allows
accumulation of electronic 'reward points'. The Department believes
that schemes of this kind fall outside the scope of the 1964 Act.
Although some voucher-based incentive schemes do still exist,
these may or may not fall within the compass of the 1964 Act,
depending on the exact form which they take.
5. The Government's intention in promoting this proposal
is to remove the provisions of the 1964 Act which regulate the
operation of trading stamp schemes and to provide that all customer
loyalty schemes which involve the exchange of tokens for goods
are governed by the single legislative framework in the 1982 Act.
6. The House has instructed us to examine the proposal
against the criteria specified in Standing Order No.141 (6) and
then, in the light of that examination, to report whether the
Government should proceed, whether amendments should be made,
or whether the Order should not be made.[2]
7. Our discussion of matters arising from our examination
is set out below. Where a criterion specified in Standing Order
No. 141(6) is not discussed in the report, this indicates that
we have no concerns to raise about that criterion. In the course
of our examination, we requested further information from the
Department about a number of issues relating to the proposal.[3]
The Department's responses are reproduced as Appendices B and
D to this Report.
1 Copies of the proposal are available to Members of
Parliament from the Vote Office and to members of the public from
the Department. The proposal is also available from the Cabinet
Office website:www.cabinet-office.gov.uk/regulation/rra/rro/proposals.asp Back
2
Standing Order No. 141(2) Back
3
Appendix A. A further letter is reproduced at Appendix C. Back
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