The Advertising Standards Authority (ASA) has issued an enforcement notice for whisky cask investment companies, laying out new terms by which their advertisements must abide to ensure consumers are not misled.

The enforcement notice states that ads for whisky cask investment must make clear the risks inherent in investment (i.e. that their value can go down as well as up) and should not imply guaranteed returns. It also says that ads must prominently feature "material information" – that which a consumer needs to make an informed decision on a purchase; the ASA says this material information must include that whisky cask investment is currently unregulated, that the value of investments is variable, and that terms, conditions, and fees are applicable for the service.

It also stresses the need for whisky cask investment companies to be socially responsible, ensuring their ads "do not irresponsibly take advantage of consumers' lack of experience or credulity".

The notice comes into force on 2 January 2024. It covers ads in all media (i.e. print, visual, and digital), and applies to both paid advertisements and non-paid advertising such as email newsletters and social media content. 

The publication of the notice comes after two whisky cask investment companies were ruled against by the ASA in August for running "misleading" adverts.

The terms and conditions that the ASA says "should be made clear to consumers" are: that new-make spirit has to be matured for three years, during which time its alcoholic strength could reduce, but that the strength must be at least 40% ABV for it to be considered 'whisky'; that the volume of spirit in a cask will decrease over time; a consumer's right to cancel and the cost to do so; and how an investment is realised and any conditions around this process.

As well as detailing information that must be presented in a whisky cask investment ad, the ASA enforcement notice also requires companies to consider how their ads may be received by their audience, reflecting both "the spirit and the letter" of relevant legislation: "When creating an ad, you should consider the presentation of the content in its entirety, the context in which it appears and the likely interpretation of claims by the target audience."

Further requirements in the enforcement notice include that all claims of returns (e.g. x per cent per annum) must be representative, supported by documentary evidence, and show clearly how the rate was calculated; that qualifications can be used to clarify claims, but not to the extent that they mislead the consumer or contradict previously stated information; and that any endorsements used, for example logos from awards or other industry organisations, must be genuine. The notice also adds that a company should only state that it has been "featured" in the press if the press coverage was an editorial feature – using this language if the company paid to feature "is likely to be considered misleading". 

The ASA enforcement notice can be read in full here.

In response to a recent increase in the number of UK-based companies offering investment in cask whisky, a new industry body, the Cask Whisky Association, was established in September 2023. However, it has been the subject of some controversy since its launch with claims of "vested interests" among its founder members.