Warning: Theorem of Transparency on Advertised Price Discounts
Court opposes questionable advertisements featuring price reductions - Ruling Issued by Lower Court: (Occurrence of events detailed in the original text)
Stay tuned for the Federal Court of Justice's (BGH) determination today (from 10:00 AM) on the regulations surrounding businesses advertising price reductions for their products. In this instance, the Competition Centre is going after the grocery retailer Netto Marken-Discount, a contender distinct from Netto with the dog logo prominently present in the north and east of Germany.
Netto spread the word in a brochure, boasting a 36% price drop on a coffee product. The current price ($4.44) and the price from the previous week ($6.99) were disclosed, but the fine print provided in a footnote revealed the product was priced at $4.44 within the last 30 days.
The European Court of Justice has weighed in on the matter of reference prices
As per the Price Indication Ordinance, retailers advertising price discounts must also disclose the lowest price charged for the product within the last 30 days. The debate surrounding how to present such a reference price (e.g., whether footnotes suffice) was a bone of contention.
In September, the European Court of Justice ruled that sales promotions boasting about "price highlights" must always reference the lowest price of the past 30 days and the discount percentage should be calculated based on this. When the BGH will deliver its verdict against Netto remains uncertain (Az. I ZR 183/24).
- Federal Court of Justice
- Advertising Regulations
- Netto Marken-Discount
- Grocery Retailer
- Misleading Advertising
- Price Comparison
- Consumer Protection
- In light of the controversy over Netto Marken-Discount's advertising practices, the Community policy on Misleading Advertising, employment policy concerning consumer protection, and vocational training in advertising regulation could be reviewed to ensure clarity and transparency in promotional strategies in the business sector.
- To maintain financial sustainability and uphold business ethics, it is of utmost importance for Netto Marken-Discount to adhere to the ruling of the Federal Court of Justice on Advertising Regulations, considering the potential impact on their reputation and consumer trust, especially in the context of vocational training programs aimed at fostering ethical business practices.
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