Else Beekman
The Ministry of Social Rights, Consumer Affairs, and Agenda 2030 has imposed fines totaling €90,000 on two major e-commerce companies for misleading discounts during the last Black Friday. Additionally, there are six ongoing sanction procedures against major online retailers for similar violations, with proposed fines exceeding half a million euros.
“False discounts” refer to the practice where retailers inflate product prices just before a discount period and then reduce them to the original price during the sale. This creates the illusion of a significant discount for consumers, which is not actually the case.
For instance, a pair of sports shoes was sold for €29.99 between November 18 and 19 last year. On November 20, the price increased to €48.95, only to drop back to €29.99 on Black Friday (November 24). This made it appear as though there was an €18.96 discount, which was factually incorrect.
Legal framework and enforcement
According to the Spanish Retail Trade Regulation Act, the discounted price must be the lowest price that was applied to the product in the previous thirty days. This law is designed to ensure consumers can make fair comparisons. Violations of this law can result in fines of up to €100,000 per case, or more, depending on the extent of the unlawful profit.
Ongoing investigations
Current investigations conducted by the Directorate General of Consumption utilise the European Commission’s Price Reduction Tool to monitor price changes. These investigations revealed that 60% of the companies checked were guilty of these deceptive practices. Moreover, this affected more than 20% of the products examined.
Continued monitoring during summer sales
The Ministry has announced that monitoring will continue during the recently started summer sales. The goal is to identify and combat further misleading discount practices.
Also read: Spanish Consumer Organisation warns against Black Friday offers