The Advertising Standards Authority (ASA) has referred complaints about promotional offers website Groupon to the Office of Fair Trading (OFT).
The ASA yesterday said it had “serious concerns” about Groupon’s ability to adhere to the Advertising Code.
It added: “It is in the public interest that we refer the matter to the OFT, the OFT being better placed to address any underlying issues concerning Groupon’s trading practices generally.”
The OFT said it had started an investigation of its own initiative in July.
It said in a statement: “The OFT has opened an investigation into the trading practices of MyCity Deal Limited (trading as Groupon UK (‘Groupon’)).
“The OFT is considering whether Groupon is complying with consumer protection legislation, including in relation to certain of its advertising practices.
“The opening of this investigation follows complaints the OFT has received in relation to Groupon’s trading practices.
“As part of its investigation, the OFT is also considering concerns that have been raised with the OFT by the Advertising Standards Authority (‘ASA’), in light of complaints the ASA has received.
“This investigation is ongoing and the OFT will not be in a position to determine whether it considers the law has been infringed until it has completed its investigations and assessed the available evidence.”
The ASA said in a statement that it was referring complaints that specifically concerned Groupon’s failure to conduct promotions fairly, such as not making clear significant terms and conditions, failure to provide evidence that offers were available, and exaggeration of savings claims.
“In 2011, the ASA has formally investigated and upheld complaints against Groupon’s advertising on 11 occasions.
“We have also informally resolved 37 cases.”