Dummy Online Promotions: Will They End Soon?

“Save € 260”: this is the tempting discount that Cdiscount offered for the Samsung Galaxy S20 FE 4G smartphone in early May during the promotional process in France Days. Instead of €659 (its “old” price, according to Cdiscount, which shows this amount as a price crossed out), the device is offered at €399.

Fantastic deal? I’m not sure … because at the same time, many other sites offer this model at similar prices, between 380 and 400 euros, including Samsung in their own online store. Above all, Cdiscount itself sold this version of the Galaxy S20 at the price of 449 euros in early April, according to an old version of the page, preserved in a copy on archive.org. In short, the price cut-off of €659 is mainly used to be able to offer a huge discount – however, Next INpact has warned you to be wary of choppy prices!

New rule: lowest price in the last 30 days

This kind of fake advertisements prevalent on the Internet may disappear. A clause resulting from the European Directive on Consumer Protection Rules brings order to price reduction announcements (Directive 2019/2161 known as the “omnibus” directive, was transferred into French law at the end of 2021). It applies as of May 28, 2022, and neatly frames the reference price (or price crossed out) that is used to calculate discounts. To date, professionals are very free to choose this price, which allows for many excesses.

The price before the discount, which must be shown, must now correspond to ” The lowest price charged by the merchant to all consumers in the past 30 days prior to the application of the price reduction According to the new Article L. 112-1-1 of the Consumer Code. This amounts, more or less, to restoring the norm that existed in France prior to 2015.

This is to ensure that the discounts offered are authentic. This reference period is thirty days It aims to prevent traders from manipulating prices and offering false price cuts, such as raising the price for a short period of time before lowering it afterward by passing it off as a (significant) price cut that misleads the consumer It was stated in the guidance document published by the European Commission on this aspect.

this rule” So it ensures that the reference price is real and that it is not just a marketing tool to make the discount attractive. »

Europe is taking back what it removed

Today, the use of old or rarely applied reference prices in order to artificially inflate discounts is the subject of frequent criticism: consumer advocates talk about this topic, for example during Black Friday or during sales.

The irony of history: If the European Union is regulating these practices, it is through him that the turmoil arrived. In France, the rule of the lowest price that was applied in the 30 days preceding the reduction has already been included in regulations since… 1977! This matter 77-105 / S., studied by generations of jurists. More recently, it was included in the decree of 2008.

But this age-old principle has not resisted the rise of online commerce, whereby all shots are allowed to prevent an Internet user from clicking on a competitor. Thus, Cdiscount, which has been suspended for several controversial promotions, vowed to defy French regulations ten years ago. The European Justice agreed with him in September 2015. It considered that EU law does not allow such a restrictive framework.

So the French authorities abolished the 30-day rule. From that time until today, the regulations (Ordinance of March 11, 2015) leave plenty of wiggle room for physical stores and online selling sites. They freely set the reference price, provided they can justify it and not fall into misleading business practices.

The manufacturer’s recommended price cannot be used

Thus this period of very loose supervision, which is conducive to fancy upgrades, ends on May 28, 2022. But the return to status quo is not complete. The new rules are more restrictive than those in effect before 2015. At that time, the manufacturer’s recommended price was also accepted as a reference price. The European directive does not provide for this possibility.

This protection can prove invaluable for high-tech products, whose prices drop rapidly after they hit the market. Today, many offers use an outdated “brand suggested price” as the reference price. This is the case of the Cdiscount for the Galaxy S20 example: the written off price of 659 euros, which suggested a massive reduction, is indicated as “ Brand recommended price in June 2021 In fact, it hasn’t really been used for that long… With the new regulations, Cdiscount will no longer be able to use that amount as a spot rate.

However, the rule for the lowest price in the past 30 days will have some exceptions. It does not apply to price reductions on perishable products, in the case of successive reductions (for example, a second price reduction during sales), or when a seller compares its prices with those of other distributors.

Sanctions will depend on the zeal of the controls

For professionals, failure to comply with this new price frame of reference is considered a deceptive business practice, punishable by two years in prison and a fine of 300,000 euros.

Will e-merchants who are more active in promotion find new tricks to evade fair discount ads? Or can we finally hope for a big cleanup?

Particularly inherent are dubious promotions, so everything will depend on the frequency and severity of checks. The Fraud Suppression Department (DGCCRF) is responsible for this. But her work is constrained by her limited means: the lack of manpower is regularly condemned by the management unions.

To facilitate their work, Internet users can report suspicious discounts via the official signal.conso.gouv.fr platform. In the “Purchase (store or online)” section there are subsections “Price” and then “False Discount”.

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