3 March 2015
The sports shop XXL Sports & Outdoor Oy (XXL) has used a price promise in its marketing without having made sure that its prices are lower than those of its competitors. In addition, the reduction in prices and the duration of the offers have been indicated in a way that contravenes legislation.
XXL, which began business in Finland in 2014, has used in its marketing a price promise comparable to a price guarantee according to which it aims to be the cheapest option on the market and to credit consumers the difference if they find an equivalent product at a cheaper price elsewhere. According to established legal praxis, marketing of this kind, in fact, constitutes a claim of being cheaper, which the marketer must be able to substantiate. According to the Consumer Ombudsman, XXL has not established in a reliable manner that its prices are cheaper than those of similar products offered by competitors.
XXL has also advertised the price reduction both in euros and percentages claiming that the discount has been calculated on the basis of a price that has not been previously charged at the same store. Under the Finnish Consumer Protection Act, a discount must be calculated on the basis of the price applied previously (immediately prior to the sale) on the same retail premises, on the same product.
In addition, XXL has indicated a short duration of the offer in its marketing and has given the impression that the offer is one time only. In reality, the advertised product has been sold at the same price also after the offer period.
The Consumer Ombudsman called for the Finnish Market Court to prohibit XXL Sports & Outdoor Oy from using in its marketing a price promise without XXL having made sure in a reliable manner that its prices are cheaper than those of similar products of competitors. The Consumer Ombudsman also called for the Market Court to prohibit the company from advertising its prices as reduced if the discount has been calculated on the basis of a price that has not been previously charged at the same store. Furthermore, the Consumer Ombudsman requires that the company be prohibited from claiming in its marketing that the offer product is available at a certain price only for a short, limited time, if the company sells the same product after the offer period at the same price.
The Consumer Ombudsman also calls for the injunction to be made more effective by imposing a penalty payment of EUR 200,000. A petition was filed with the Finnish Market Court on 27 February 2015.