End clap for fake online promotions

by time news
End clap for fake online promotions

A big string. E-commerce sites have accustomed consumers to barred prices. A recent example is noted by the specialized digital site NextImpact: Cdiscount posted a great promo on a Samsung brand phone in early May. Here it is sold at 399 € instead of the 659 €, ostensibly crossed out, before discount. Opportunity to seize!

Reference price

Only, the e-commerce site was selling this same phone for €449 a month earlier. The price has been increased as the promotion period approaches to show a bigger discount. The consumer sees nothing but fire.

An ordinance fills this loophole in consumer law from May 28: the online seller will now be obliged to display the lowest price practiced on his site over the last thirty days next to the promotion. It should be noted that, in the event of successive reductions, the reference price used is the price prior to the first reduction.

“A modernization of the legal framework for consumer protection”which had to be adapted “digital transformation” specifies the ordinance which modifies the consumer code. It was taken at the end of 2021 in transposition of a European directive.

New means of repression

“Various other texts taken at European Union level to thwart certain commercial strategies such as the shelving of promotional products only during the said promotion to avoid comparing with a previous price which does not, by nature, exist”, notes, however, the doctor of law Cédric Hélaine, in a comment on the specialized site Dalloz news.

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The General Directorate for the Prevention of Fraud (DGCCRF), attached to the Ministry of the Economy, will be responsible for ensuring the application of the text. Fines can now exceed the limit of €300,000 and even climb up to 4% of the sanctioned player’s turnover, in the event of a major infringement detected at Community level. The lack of means of this administration is however regularly pointed out.

Backtrack

However, a flaw dated 2015 has just been filled. At the time, it was Cdiscount that attacked (and overthrew) existing French legislation, taking its case to European judges. French legislation already provided for online promotions to be calculated on the basis of a reference price, the latter being the lowest price displayed over the last thirty days.

But the provision clashed with the 2005 EU directive on unfair commercial practices. France had adopted excessively restrictive legislation in this area: given that the rules in this area are harmonized at European level, “Member States cannot adopt (…) more restrictive measures than those defined by the said directive”,motivate, at the end of 2015, the judges of the Court of Justice of the European Union (CJEU). However, contrary to what is permitted by the European directive, French legislation provides “a general ban, without a case-by-case assessment to establish unfairness”, promotions without reference prices.

It was therefore necessary to wait for the revision of the European framework in this area in 2019, then the transposition of the directive into French law three years later to see this thirty-day rule reappear.

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