There has been a remarkable increase in the volume of Scotch whisky cask sales in recent years, attracting interest from buyers across the world. As a result, the number of intermediaries involved in facilitating cask sales has also seen a sharp rise, with some companies promising double digit percentage returns on investments. However, the marketing practices of certain cask sales businesses has now prompted the attention and scrutiny of the UK Advertising Standards Authority (ASA), which has recently upheld two complaints relating to misleading and irresponsible advertising.

In an earlier blog, we presented an overview of the core legal principles relevant to cask purchases and key considerations for consumers when purchasing casks of scotch whisky. We now turn our attention to the heightened regulatory scrutiny from the ASA and consider what businesses need to do to maintain compliant marketing practices.

Advertising claims

Another challenge facing trusted intermediaries is that the cask purchase market is now a highly competitive market and companies looking to advertise their services to consumers must also navigate the compliance requirements of UK advertising rules. Earlier this week the ASA published two separate rulings upholding complaints of misleading advertising practices by two cask purchase companies, namely: (i) Blackford Casks Ltd t/a Whisky Investment Partners; and (ii) London Cask Co Ltd t/a London Cask Company (the "Cask Purchase Rulings").

Blackford Casks Ltd t/a Whisky Investment Partners

Online advertisements from this company drew complaints to the ASA around specific claims guaranteeing high-percentage annual return from cask investments. The infringing adverts appeared in an online display ad, company website and two paid-for Facebook posts from 2022.

One of the adverts included a claim that: "Cask Investment Get Returns up to [sic] 12% Per Annum”. The ad linked to a page on the Whisky Investment Partners’ website with the heading ‘What is the best performing asset class of 2020? Whisky.’ Smaller text underneath stated: “We help investors get involved in a billion-pound market that has shown average returns of 8-12% over the last couple of decades,” with a button to download a free guide.

The ASA investigation raised four findings concerning misleading advertising and irresponsible marketing practices. All four findings were upheld. To summarise these findings:

  • The ASA considered that consumers would understand the investment return claims to mean that they could expect to achieve an annual return of up to 12% in the online ad, and a return of between 8%-12% in the Facebook post.
  • The use of an investment case study and investment claims presented therein related to past investment performance and the adverts did not make it clear to consumers that past performance was not necessarily a guide for future returns.
  • The ASA interpreted the advertisement to infer that cask investment is a secure way to invest savings or fund retirement and would generate substantial returns. As investments are not guaranteed and could expose consumers to losses it was determined that these statements amounted to irresponsible advertising.
  • The ASA noted that in addition to the cost for the cask of whisky, there were other upfront costs and ongoing costs throughout the ownership of a cask that were omitted from the ads. Further, the cask purchase would be subject to terms and conditions, but these were not referenced in the adverts. The ASA therefore concluded that the adverts had failed to set out an offer for a financial product in a way that allowed it to be easily understood by the target audience and therefore omitted material information.

London Cask Co Ltd t/a London Cask Company

Similar claims were made by London Cask Co, which had a newspaper ad in The Guardian in 2022 that featured the text: “Earn an average of 13%* per annum investing (sic) whiskey.” The adverts also referenced the 2020 Knight Frank Wealth Report, featuring the statement: “Over the past 10 years, rare whiskey prices have increased by an impressive 586%.” The ASA's investigation identified that Knight Frank’s annual Whisky Index uses data from Rare Whisky 101, which tracks the UK auction prices of 100 bottles of rare Scotch whisky, as opposed to casks. As such, the use of data evidencing the growth of rare bottles of whisky is not directly comparable to whisky cask sales.

It was also noted that London Cask Co had two customers who had bought and sold casks of whisky through the company although those customers had sold their casks soon after they bought them and neither had made a return on their purchase. As such, the claim that consumers could earn average annual returns of 13% was not substantiated and was held to be misleading.

Analysis and key messages

To briefly summarise the key themes from the ASA emerging from the Cask Purchase Rulings:

  • Advertisers must make it sufficiently clear that the value of investments in cask whisky was variable and could go down as well as up, that past performance was not necessarily a guide for future performance. Offers for financial products should be clear and easily understood, specifically, risks should be made clear. Further, advertisers must be careful to avoid omitting material information such as details on applicable terms and conditions, fees and ongoing or future charges i.e. storage or exit fees.
  • Any claims about return investments must be substantiated. Statements guaranteeing high percentage annual returns must be capable of factual substantiation. For example, London Cask Co Ltd attempted to rely upon an industry wide percentage growth statistic that was applicable only to bottles not casks. Also, out of their 180 casks sold, only 2 clients had completed onward purchases. On this basis, the ASA held that there was a lack of evidence to support their double-digit annual returns claims.
  • Statistics used must match the services offered by the advertiser. So, a growth statistic relevant to bottle sales cannot equate to cask sales.
  • Claims that cask purchases are a secure investment or retirement vehicle are irresponsible and should be avoided.
  • The ASA emphasised that the cask sales market is an unregulated market and so there was a greater need to ensure consumers are presented with all material facts to make an informed purchasing decision. In particular: (a) purchasing terms and conditions should be clear and unambiguous; (b) any applicable charges should be transparent and not hidden away; and (iii) information on transfer of ownership as well as options on exiting the investment should be made clear to consumers.
  • Following a cask purchase, if a buyer wishes to bottle their cask, excise duty will be triggered when the bottles are dispatched to the owner. The duty due is significant and will be based on the rate of duty applicable at that point - not when the cask was purchased. Thus the purchase price of the cask is only the initial outlay. Additional storage costs may apply – usually after a fixed period. Also, movement of the cask under bond is strictly controlled and can only be carried out by authorised operators, which will likely incur additional fees. As such, businesses must ensure that consumers are given clear and transparent information on these costs and the process that may trigger those costs. The lack of transparency on terms and conditions was one of the issues identified by the ASA in the Cask Purchase Rulings leading to the ASA upholding a complaint of misleading advertising practices.

Brodies has extensive expertise advising on advertising compliance and issues relating to the purchase of Scotch whisky casks. If you are looking to acquire a cask and would like to discuss how we can assist, or any of the issues covered in this blog, please get in touch.


Orla White

Trainee Solicitor