A European Commission review of 314 online stores during Black Friday and Cyber Monday found 30% improperly displayed price reductions.
European Commission Report Reveals Widespread Discount Deception
The European Commission, along with consumer protection authorities from 23 EU countries, investigated 314 online stores during Black Friday and Cyber Monday. The investigation revealed that a significant 30% of these retailers misrepresented discounts, violating price indication directives.
The coordinated “sweep” action, led by the European Commission, aimed to verify compliance with EU consumer law regarding pricing practices. Authorities from 23 member states, as well as Iceland and Norway, analyzed the practices of the selected online stores.
Key Issue: Misleading Discount Claims
A crucial finding was that 30% of retailers presented discounts in a manner inconsistent with the price indication directive. This directive mandates that the reference price must be the lowest price applied during the 30 days preceding the promotion; incorrect labeling constitutes consumer deception.
Unfair Commercial Practices Identified
The investigation uncovered other unfair practices, including hidden fees and pressure tactics to encourage purchases. Specifically, 36% of sellers added optional products to the shopping cart, in 40% of cases without the customer’s explicit consent.
Further violations of the unfair commercial practices directive were identified: 34% used price comparisons without clarifying their basis (60% of the time), 18% employed pressure techniques like false scarcity claims (over half of which were misleading), and 10% used “drip pricing” – concealing fees until the final stage of checkout.
Commission Urges Fair Treatment of Consumers
Henna Virkkunen, Vice-President of the European Commission, emphasized in a statement that while Black Friday and Cyber Monday offer opportunities for both businesses and consumers, these occasions are not an excuse to break the rules. She stressed the expectation of fair treatment for consumers, regardless of the shopping environment.
Enforcement and Consumer Rights
National consumer protection authorities within the EU, coordinated through the CPC network, can now initiate proceedings against offending retailers. Polish consumers can report violations to the Office for Competition and Consumer Protection (UOKiK).
The CPC (Consumer Protection Cooperation) has a proven track record of success, having previously secured commitments from Booking.com to revise its presentation of offers, discounts, and prices, and from Airbnb to improve transparency in its listings. Facebook, Twitter, and Google+ also updated their terms of service and implemented procedures for handling problematic content reported by consumer protection authorities.
Frequently Asked Questions
The European Commission’s “sweep” action during Black Friday and Cyber Monday involved the analysis of 314 online stores by authorities from 23 EU countries, Iceland, and Norway. The investigation found that 30% of retailers improperly displayed discounts, violating the price indication directive.
The price indication directive requires that the reference price for a discount must be the lowest price applied during the 30 days prior to the promotion. Incorrectly stating this price is considered misleading to consumers.
The investigation revealed that 36% of retailers added optional products to shopping carts, and in 40% of those cases, this was done without the customer’s explicit consent, a practice illegal within the EU.
“Drip pricing,” the practice of concealing fees (such as shipping costs) until the end of the purchase process, was observed in 10% of the controlled online stores.
National consumer protection authorities within the CPC network can initiate proceedings against offending retailers. Polish consumers can report violations to UOKiK.