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Warning: Untrustworthy exhibitor directory offers from: Expoguide, Construct Data etc

Polish Chamber of Exhibition Industry as well as foreign national and international exhibition industry organizations, including UFI – the Global Association of the Exhibition Industry, AUMA – The Association of the German Trade Fair Industry, AEO – Association of Event Organisers (United Kingdom) and many others, for several years have been registering complaints from scammed exhibitors who contact them almost daily in matters regarding unofficial exhibitor directories and guides, offered by Expoguide, Construct Data etc.

We got to know that the German AUMA’s legal department has even documented several hundred cases already, which allowed them to be well informed on how the publishers of unofficial directories operate.

To protect interests of exhibitors, the participants of trade fairs and exhibitions in Poland, Europe and all over the world, Polish Chamber of Exhibition Industry also for many years has been informing Customers about ongoing activities of publishers of the above mentioned unofficial exhibitor directories, targeting exhibitors in the run up to trade fairs, offering them entries in unofficial sub-standard online directories.

It is crucial that all companies exhibiting as well as trade fair and exhibition organizers are made aware of this. The sheer scale and systematic way in which these publishers attack exhibitors and organizers of trade fairs and exhibitions, and, at the same time, the credibility of the exhibition industry, is outrageous.

The following information, produced in cooperation with UFI and AUMA aims to make exhibitors aware of the illicit activities of the publishers of unofficial directories and to provide assistance to the exhibitors concerned.

How to recognise untrustworthy offers

What is absolutely the most important thing to know is that:

  • a letter (a form) received from a publisher of an untrustworthy exhibitor directory resembles an organizer’s free catalogue (directory). It gives the impression of having been sent by a trade fair organizer. It usuallyrefers to an upcoming trade fair or exhibition which the exhibitor is due to attend. By including a printed customer number or the trade fair’s logo the letter implies that a business relationship already exists. De facto, these publications have nothing in common with the organizers or any of their events;
  • in some cases the letter can be accompanied by a form containing basic information on the exhibitor, along with a request to update it. To make it easier to reply, a postage paid envelope will be enclosed which can be used to return the updated and signed form;
  • moreover, often such forms give the impression of being an offer to provide a customer with an entry in an exhibitor directory free of charge. However, payment terms proposed by the publishers which stipulate long-term obligations to pay even several thousand euros are generally hidden in the small print in the bottom of the form/letter page. Unsuspecting exhibitors who sign and return the form to a publisher are then contracted into a three-year, non-retractable contract which could cost the exhibitor a significant amount of money, with no foreseeable benefits.

Recipients should be cautious if they notice any of the following:

  • if details of the fees and the duration of the customer’s obligations are mentioned only in the terms and conditions in the small print,
  • if a form is provided that already includes certain data,
  • if only the publication of a so-called basic directory entry or if only an online registration is free,
  • if the company in question is based abroad.

If in doubt you are advised to contact the organizer of the exhibition.

What should you do when receiving an offer for a directory entry?

Make absolutely sure that you can trust the offer being made. Do not sign a fraudulent offer. Inform your colleagues, in particular in your accounting department, to make staff aware of the situation, and so as to avoid future cases. Send a copy of the form to your chamber of industry and commerce or to the professional association representing your branch of trade.

What should you do if you have signed the form in error?

In most cases, it is only after exhibitors have received an invoice that do realize that they had mistakenly signed an agreement for a directory entry for which fees are due. In such cases it is possible to challenge the agreement, on grounds of error or fraudulent intent. Send a reply using a telefax machine which registers a transmission report, challenging the agreement and making clear that you do not intend to pay the invoice (see below for a form letter to Expoguide). Keep the telefax transmission report as evidence.

What happens if I do not pay?

The publishers of unofficial exhibitor directories often remain unimpressed by declarations to contest the issue and by a refusal to pay, so that exhibitors must be prepared for a publisher to pursue his claims even after they have challenged the agreement. They will usually then receive further invoices and reminders stating the publisher’s legal position. Later on, exhibitors will sometimes be threatened with collection agencies, who are often based abroad, or with legal proceedings ordering payment of debts, or with legal action. In general the purpose of these measures is only to intimidate exhibitors and to prompt them to pay.

It is good to know that none of the exhibition industry organizations is aware of any cases in which publishers of unofficial exhibitor directories have actually taken legal action against exhibitors. However, if you do receive a court payment order or if court proceedings are filed against you then you are advised to seek legal assistance.

What should you do if you have paid?

If the agreement is in breach of law or if it can be successfully contested then it may be declared void. This would result in no further obligation to pay fees and would mean that in theory any previous payments could be reclaimed.One should however weigh up the pros and cons of investing time and money to engage lawyers and courts.

Often the companies in question are based in a country outside Europe, cease operations, or are bankrupt. Furthermore, the legal situation is not always clear. While there are cases in which the courts have ordered that no further fees be paid, one should note that the actual content of these letters and their offers varies to a large degree, and that any rewording thereof constitutes new facts which must be legally reassessed. Furthermore, where companies are concerned, strict criteria are applied to their examining of the content of the terms and conditions in the small print. At the top of the Expoguide form, for example, it is stated in red that a directory entry will incur fees. It is therefore doubtful whether a court would uphold any appeal claiming this agreement to be void.

By courtesy of AUMA we present an example of a reply, taking Expoguide as an example. The letter refers to the German law.

Send your letter using a telefax machine which registers a transmission report.

"Dear Sir, With reference to your letter of… I do not intend to pay the sum you request. No valid agreement between us exists. According to § 134, BGB, the agreement is void as, according to § 3 Section 1, UWG, in conjunction with § 4 No. 3, UWG, you have engaged in unfair competitive practices. In the form enclosed you give the impression that a business relationship between us already exists, and in doing so you conceal the promotional nature of your letter. Furthermore, the clause indicating the fees for providing a customer entry and stating the duration of the agreement is not an effective part of the agreement, as it constitutes a surprise clause as defined in § 305 c, Section 1, BGB. The fact that a directory entry and an online update are free of charge, but that sending an update using the enclosed form and postage paid envelope incurs a fee of several thousand euros constitutes a surprise. The tone of the letter and the enclosed form give the impression that even if one updates information the directory entry remains free of charge. Thus, as a customer I would logically not expect to be charged a fee. By way of precaution I contest the agreement on grounds of error, in accordance with § 119, Section 2, BGB. When I signed your offer to provide an entry in the exhibitor directory I assumed that this entry would incur no fees. One only becomes aware of the actual fees for a directory entry after finding them hidden in the small print. By way of precaution I contend that, in accordance with § 138, BGB, the agreement is void on grounds of usury, as the extent of the services offered is wholly disproportionate to the fees. I shall not reply to any further correspondence from you or from a collection agency representing you. I expressly reserve the right to take legal action against you in this matter.”

contact: Silvia Bauermeister (lawyer), Legal Affairs/Business Development
s.bauermeister@auma.de

This information sheet only contains basic advice and does not claim to be a complete guide. Despite having taken the utmost carein compiling this information AUMA shall not be responsible for the accuracy of the content.

Source: Polish Chamber of Exhibition Industry archives, AUMA ; UFI

2014-07-15