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Poster for Black Friday offers. AFP
Spain's ministry for consumer affairs opens proceedings against major online retailers for fictitious Black Friday sale prices

Spain's ministry for consumer affairs opens proceedings against major online retailers for fictitious Black Friday sale prices

Some traders could face big fines after allegedly raising prices on products in the days preceding Black Friday, then putting them back to the original price to make out it was a special offer

Alfonso Torices

Tuesday, 7 May 2024, 23:04

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Spain's Ministry of Social Rights, Consumer Affairs and 2030 Agenda has opened proceedings against several large e-traders on suspicion that, during the 2023 Black Friday sales and marketing campaign, they sold certain products to their customers under the guise of being at discount prices when in fact they were not.

The investigations that have led to the opening of these proceedings point to the fact that they had allegedly deceived their customers by selling products as being 'on offer'. It is claimed that some products had had their prices artificially increased just a few days before Black Friday, only to be back on sale again at the same original price during the final days of November - Black Friday week. As a promotional concept Black Friday is a winner, pulling in over just a few days the highest number of e-commerce transactions for the whole year.

The Spanish ministry that champions consumer rights is headed up by Pablo Bustinduy. He has not revealed the company names nor the number of those who have been targeted. What has been revealed is that the businesses under investigation market a very wide range of products (household appliances, electronics, sports and beauty cosmetics) that can equally be purchased in high street shops and department stores. The minister holding the purse strings has pledged to impose sanctions to set an example as to how he will punish those who abuse or mislead consumers. If their offences are considered serious enough, they can be fined up to 100,000 euros or between four to six times the profits earned from their illicit activities.

We are reminded by ministerial sources that article 20 of the law in Spain governing retail commerce states that, whenever items are offered at a reduced price, the previous price must be clearly shown on each item so the consumer can make a proper comparison. The law also makes it clear that, in this case, the previous price must be the lowest price to have been applied to identical products for the previous 30 days.

The Ministry's Directorate General for Consumer Affairs opened the investigation that led to the proceedings last October, more than a month before the actual Black Friday event. The reason? The investigating office had already seen signs that several of these large online sales companies were carrying out unfair and misleading commercial practices. In fact, the Organisation of Consumers and Users (OCU) had previously carried out another related investigation in which it found that only 35% of the products on sale during these days of global promotion were truly at sale prices. Of the majority, 40% were costing the same as before the Black Friday campaign and 25% had even gone up in price.

The official investigation was carried out by the experts in the Subdirectorate General for Inspection and Sanctioning Proceedings. They monitored 1,140 products in high demand on a daily basis to check whether these online sales platforms delivered what they promised, which in many cases they did not.

The case of a television

This type of alleged fraud is best understood with a real example from one of the large online sales platforms that has had proceedings opened against it. Between 15 and 20 November 2023, this trader sold a particular tv set for 526.99 euros. On 21 November, the day before the start of Black Friday, it raised the cost of this set to 629.99 euros. During the big promotion from Wednesday 22nd to Tuesday 28th, it brought the price back to the initial 526.99 euros. In other words, the 103 euros it claimed as a 16% price reduction was a fake discount.

As a result of this price monitoring, enough evidence was found to open disciplinary proceedings against two large operators. The experts within the ministerial department for consumer affairs are completing their investigation against a number of other online companies for similar illicit practices.

The spokesperson for consumer affairs stated that the opening of these disciplinary proceedings does not prejudge the final outcome of the investigation, which must be completed and resolved either way within a maximum of nine months.

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