The aim of this prohibition is to prevent dishonest market operators from luring consumers into a transaction or into paying money or other consideration by falsely creating the illusion that they have won or may win a price. It also precludes traders from charging consumers for claiming a prize, given that - in principle - the payment of any consideration inevitably undermines the credibility of the use of the word "prize".
The assessment of the first category of situations (i.e. no prize) described in the first indent of the provision is fairly straightforward. In order not to violate the prohibition, traders must always be in a position to demonstrate that they have awarded the prize/s or the equivalent benefit/s in the exact terms stated in his/her announcement to the consumer. Failing this, the practice would be caught by the prohibition.
The second part of Annex I, n. 31 (i.e. the prize or benefit is subject to the consumer paying money or incurring a cost) covers dishonest practices whereby, for instance, consumers are informed that they have won a prize but that they have to call a premium rate line to claim it.
Another example concerns cases where the consumer is initially informed that he has won a prize and then he finds out that he must order another good or service to receive the advertised prize or the equivalent benefit.
E.g. Advertising leaflet distributed in the mail stating "You have won a free CD", where the consumer is eventually told "order now our selection of shower gels, fill in your address and you will receive your "prize".