By its decision issued on 24 November 2015 the Market Court prohibited sports shop XXL Sports & Outdoor Oy (XXL) from giving a misleading impression of the affordability of its prices and duration of its offers.
XXL has been emphasising the affordability of its prices by marketing its products at major discount rates. The discount rates have, however, been calculated from the recommended retail prices, which have not been generally applied to the product in question by XXL or other retailers. Therefore, XXL has been giving misleading information about the actual affordability of its prices.
In addition, XXL has been marketing products with offers that are valid for a limited time only, which gives consumers an impression that the offers are unique and that they need to make their purchase decision immediately. However, the products have been sold at the same discount price soon after the offer has expired.
In the opinion of the Consumer Ombudsman, as a result of misleading information given in XXL’s marketing a consumer may make a purchase decision that they would not have made without the information given. Since such marketing is in violation of the Finnish Consumer Protection Act, the Consumer Ombudsman took XXL to Finnish Market Court in February 2015.
In accordance with the Consumer Ombudsman’s requirements, the Market Court has prohibited XXL from comparing its sales price to the recommended retail price if this price does not correspond with the price that other retailers would normally apply to the product. In addition, the Market Court has prohibited XXL from presenting in its marketing the false claim that the offer product is available at a certain price only for a short limited period, even though the company sells the same product at the same price after the offer period. The injunctions were enforced with a penalty payment of EUR 100,000.
In its marketing XXL has also used a price promise according to which it aims to be the cheapest option on the market and to do everything in its power to ensure that the customers can count on getting the products at the cheapest price at XXL. The Consumer Ombudsman was of the opinion that the purpose of the price guarantee was to create an impression that XXL is the cheapest operator on the market.
The Market Court was of the opinion that the wording of XXL’s price promise does not mean that XXL would claim to have the cheapest prices. Instead, with its operations XXL aims to be the cheapest option on the market. In this respect, the Market Court rejected the Consumer Ombudsman’s requirement concerning the use of the price promise in marketing. However, in the opinion of the Consumer Ombudsman, this does not mean that using a price guarantee or other similar expressions in marketing would always be legal henceforth.
Read more: Consumer Ombudsman took XXL to Finnish Market Court for misleading marketing (FCCA press release of 3 March 2015)