(Guidelines for Ethical Business Practices)

The Direct Marketing Association of Malaysia’s (DMAM) Guidelines for Ethical Business Practices are intended to provide individuals and organizations involved in direct marketing with principles of conduct that are generally accepted nationally and internationally. These Guidelines reflect DMAM’s policy of high level of ethics and the responsibilities of the Association and direct marketers to the consumer and the community – a relationship that must be based on fair and ethical principles and practice.

Membership of the Direct Marketing Association MALAYSIA (DMAM) should abide by ethical practices. Endorsement to this effect means the public will have confidence in dealing with DMAM member companies.

What distinguishes the Guidelines, which are self regulatory in nature, is that all members are urged to support them in spirit and not to treat these provisions as obstacles to be circumvented by legal ingenuity. The Guidelines are intended to be honoured in the light of their aims and principles.

These Guidelines are also part of the DMAM’s general philosophy that self-regulatory measures are preferable to governmental mandates whenever possible. Self-regulatory actions are more readily adaptable to changing techniques, economic and social conditions, and they encourage widespread use of sound business practices.

Because dishonest, misleading, immoral, salacious or offensive communications make enemies for all advertising/marketing including direct response marketing, observance of these Guidelines by members concerned, is imperative.

TERMS OF THE OFFER

HONESTY. All offers should be clear, honest and complete so that the purchaser may know the exact nature of what is being offered, the price, the terms of payment (including all extra charges), and the commitment involved in the placing of an order. Before publication of an offer, direct marketers should be prepared to substantiate any claims or offers made. Advertisements or specific claims which are untrue, misleading, deceptive, fraudulent or unjustly disparaging of competitors, should not be used.

• CLARITY. A simple statement of all essential points of the offer should be clearly displayed in the promotional material. When an offer illustrates goods which are not included or cost extra, these facts should be made clear. An offer must be set out in such a way that it can be easily understood by the reader.
• PRINT SIZE. Print which by its small size or placement, or other visual characteristics is likely to substantially affect the legibility of an offer, or exceptions to it, should not be used.
• ACTUAL CONDITIONS. All descriptions and promises should be in accordance with actual conditions, situations and circumstances existing at the time of the promotion. Claims regarding any limitations (such as time or quantity) should be legitimate.
• DISPARAGEMENT. Disparagement of any person or group on grounds of race, colour, religion, national origin, sex, marital status or age is unacceptable.
• STANDARDS. Solicitations should not contain vulgar, immoral, profane, or offensive matter nor promote the sale or pornographic material or other matters not acceptable for advertising on moral grounds.
• ADVERTISING TO CHILDREN. Offers suitable for adults only, should not be made to children.
• PHOTOGRAPHS AND ART WORK. Photographs, illustrations, artwork, and the situations they represent, should be accurate portrayals and current reproductions of the product, service or other subject in all particulars. Where it is impossible to show the exact size, dimensions should be stated in the text where applicable.
• SPONSOR AND INTENT. No one should make offers or solicitations in the guise of research or a survey, when the real intent is to sell products or services or to raise funds.
• IDENTITY OF SELLER. Every offer and shipment should sufficiently identify the full name and street address of the direct marketer so that the consumer may contact the individual or company by mail or phone.
• UNSOLICITED OFFERS AND ORDERS BY MINORS.
• Except in the case of trade and professional samples, suppliers shall under no circumstances send merchandise to any addressee and claim payment without first having received a request for the supply of such merchandise.
• Suppliers shall not make deceptive use of proforma invoices.
• Suppliers shall maintain reasonable checking procedures to minimize the irritation caused by hoax orders.
• Marketers should make every effort not to accept orders or commitments from minors without the consent of the minor’s parent or guardian.
• Reasonable care shall be taken not to convey to minors offers suitable for adults.

• POSTAGE AND HANDLING CHARGES. Postage or shipping charges and handling charges, if any, should reflect as accurately as practical actual costs incurred.

SPECIAL OFFERS

USE OF THE WORD “FREE” AND OTHER SIMILAR REPRESENTATIONS

• A product or service which is offered without cost or obligation to the recipient may be unqualifiedly described as “free”.

If a product or service is offered as “free” for a nominal cost or at a greatly reduced price or the offer requires the recipient to purchase some other product or service, all terms and conditions should be clearly and conspicuously disclosed.

When the term “free” or other similar representations are made (for example, 2-for-1, half price or 1-sen offers), the product or service required to be purchased should not be increased in price or decreased in quality or quantity.

• BONUS OFFERS. When bonus or gift items are offered conditionally on the purchase of another item, the conditions must be stated in easily legible type.
• NEGATIVE OPTION SELLING. Offers which require the consumer to return a notice sent by the seller before each periodic shipment to avoid receiving merchandise, should contain all important conditions of the plan including:
• A full description of the obligation to purchase a minimum number of items and all charges involved and,
• The procedures by which the consumer receives announcements of selections and a statement of their frequency; how the consumer can reject unwanted items and how to cancel after completing the obligations.

The consumer should be given advance notice to periodic selections so the consumer may have a minimum ten days to exercise a timely choice.

Because of the nature of this kind of offer, special attention should be given to the clarity, completeness and prominent placement of the terms in the initial offering.

• CLEAR AND CONSPICUOUS DISCLOSURE OF RULES. Terms and conditions of contest promotions including entry procedures, the number and types of prizes, the closing date and eligibility requirements, should be disclosed in a clear and conspicuous manner in the promotion.

Contest promotions shall not be used as marketing incentives unless:

• All prizes are available and are awarded as described in the rules.
• The judging take place promptly, and fairly.
• The rules governing any contests are clearly stated at the point of entry.
• The results of the contest promotion conforms to the laws of the country or state applicable.

• PRICE COMPARISONS. Price comparisons may be made in two ways:
• Between one’s price and a former, future and suggested price or
• Between one’s price and the price of a competitor’s comparable product.

In all price comparisons, the compared price against which the comparison is made must be fair and accurate.

In each case of comparison to a former, suggested or competitor’s comparable product price, substantial sales should have been made at that price in the recent past.

For comparisons with a future price, there should be a reasonable expectation that the future price will be charged in the foreseeable future.

• GUARANTEES. If a product or service is offered with a “guarantee” or a “warranty”, the terms and conditions should either be set forth in full in the promotion, or the promotion should state how the consumer may obtain a copy. The guarantee should clearly state the name and address of the guarantor and the duration of the guarantee.

Any requests for repair, replacement or refund under the terms of a “guarantee” or “warranty” should be honoured promptly. In an unqualified offer of refund, repair or replacement, the customer’s preference shall prevail.

SPECIAL CLAIMS

• USE OF TEST OR SURVEY DATA. All test or survey data referred to in advertising should be competent and reliable as to source and methodology, and should support the specific claim for which it is cited. Advertising claims should not distort the test or survey results nor take them out of context.
• TESTIMONIALS AND ENDORSEMENTS. Testimonials and endorsements should be used only if they are:
• Authorised by the person quoted.
• Genuine and related to the experience of the person giving them, and
• Not taken out of context so as to distort the endorser’s opinion or experience with the product.

THE PRODUCT

• PRODUCT SAFETY. Products should be safe in normal use and be free of defects likely to cause injury. To that end, they should meet or exceed current, recognized health and safety norms and be adequately tested, where applicable. Information provided with the product should include proper directions for use and full instructions covering assembly and safety warnings, whenever necessary.
• PRODUCT DISTRIBUTION SAFETY. Products should be distributed only in a manner that will provide reasonable safeguards against possibilities of injury.

• PRODUCT AVAILABILITY. Direct marketers should only offer merchandise when it is on hand or when there is a reasonable expectation of its receipt.
• UNORDERED MERCHANDISE. Merchandise should not be shipped without having first received a customer’s permission. The exceptions are, samples or gifts clearly marked as such, and merchandise mailed by a charitable organization soliciting contributions. As long as all items are sent with a clear and conspicuous statement informing the recipient of an unqualified right to treat the product as a gift and to do with it as the recipient sees fit, at no cost or obligation to the recipient.
• SHIPMENTS. Subject to acceptance of an unpaid order, goods offered from stock must be shipped within 30 days of receipt of order or the time limit as stated in the original order.

If there is a delay in shipping goods, the customer must be advised in writing within 30 days or of receipt of order, provided a proper method of communication is possible.

DMAM members are reminded that they should abide by any Consumer Protection Acts in force.

CREDIT AND DEBT COLLECTION

• EQUAL CREDIT OPPORTUNITY. A creditor should not discriminate on the basis of race, colour, religion, national origin, sex, marital status or age. If the individual is rejected for credit, the creditor should be prepared to give reasons why.
• DEBT COLLECTION. Unfair, misleading, deceptive or abusive methods should not be used for collecting money. Direct marketers should take reasonable steps to ensure that those collecting on their behalf, comply with this guideline.
• PERSONAL INFORMATION. All list owners, brokers and compilers should be protective of the consumer’s right to privacy and sensitive to the information collected on lists and subsequently considered for transfer.
• Information supplied by consumers such as, but not limited to, medical, financial, insurance or court data, should not be included on lists that are rented or exchanged when there is a reasonable expectation by the consumer that the information would be kept confidential.
• NAME REMOVAL (LISTS). List owners should provide a service of suppressing or removing a name from their lists when requested to do so.
• LIST USAGE AGREEMENTS. List owners, brokers, compilers and users should make every attempt to establish the exact nature of the list’s intended usage prior to the sale or rental of the list. Owners, brokers and compilers should not permit the sale or rental of their lists for an offer that is in violation of any of the Ethical Guidelines of DMAM.

• LIST ABUSE. No list or list data should be used in violation of the lawful rights of the list owner nor of the agreement between the parties; any such misuse should be brought to the attention of the lawful owner. List owners shall not offer for sale or rental any lists that do not contain the quality and type of names claimed.

TELEPHONE MARKETING

• REASONABLE HOURS. All telephone contact should be made during reasonable hours.
• DISCLOSURE AND TACTICS. All telephone solicitations should disclose to the buyer during the conversation the cost of the merchandise, all terms, conditions and the payment plan and whether there will be postage and handling charges. At no time should “high pressure” tactics be used.
• USE OF AUTOMATIC ELECTRONIC EQUIPMENT. No telephone marketer should solicit sales using automatic electronic dialing equipment unless the telephone immediately disconnects when the called person hangs up.
• TAPING OF CONVERSAITONS. Taping of telephone conversations should not be conducted without consent of all party.
• TELEPHONE NAME REMOVAL/RESTRICTED CONTACTS. Telephone marketers should remove the name of any contact from their telephone lists when requested to do so. Telephone marketers should not call telephone subscribers who have unlisted or unpublished telephone numbers unless a prior relationship exists.

CODES AND STANDARDS OF PRACTICE

• Direct marketers should operate in accordance with state and locals laws governing advertising, marketing practices and the transactions of business by mail, telephone, printed or broadcast media.
• Agencies, consultants and suppliers of services and goods to direct mail and direct marketing advertisers, shall exercise all reasonable endeavour to ensure that any direct mail or mail order advertisement or telephone marketing activity to which they are contributing their goods or services, conforms with these codes and standards of practice.
• Mailings that promote material that can be construed as pornographic, salacious, vulgar or offensive are unacceptable to, and will not be countenanced by, the Direct Marketing Association of Malaysia.
• In its continuing efforts to improve public confidence in and direct marketing, DMAM Ethical Guidelines will be maintained, updated periodically and distributed to its members