KOMEKSIMAS FINED FOR MISLEADING ADVERTISING

On 21 May 2013, the Competition Council (Konkurencijos taryba, KT) imposed a fine of LTL 24,800 (EUR ~ 7,183) on UAB KOMEKSIMAS for misleading advertising and ordered the undertaking to terminate the dissemination of the advertisement concerned.

UAB KOMEKSIMAS is the owner of the online store www.b-a.lt involved in a retail trade of various products, including perfumery and cosmetics, furniture, building materials, leisure time goods, clothing and accessories.

Having noticed an article published in the online news portal Delfi, according to which, the products of cosmetics sold in the online store www.b-a.lt were much cheaper than alongside indicated market price, the KT launched the investigation.

During the investigation the KT determined that UAB KOMEKSIMAS in various periods of time in its online store www.b-a.lt had been promoting misleading advertisement of various types by offering to purchase goods for a certain lower price as compared with:

· the “Market price” of the relevant goods,

· the former price of the relevant goods (references to “Formerly cost”, “Old price”),

· the price of the relevant goods without any explanation of such price.

At the moment, the advertisement wherein all the prices of the goods offered by UAB KOMEKSIMAS are compared with crossed out prices without explanation is still being promoted in the online store www.b-a.lt.

As the KT determined, during the investigation no evidence had been provided that the price comparison advertised by UAB KOMEKSIMAS had been based on factual data, which would have proved the indicated prices to be a true reflection of the real prices, and therefore, such advertisement could have mislead the consumers. Consumers that visit the UAB KOMEKSIMAS online store may expect that the goods are sold for a lower price than in other trade places, and this may determine their choice to purchase the goods in this particular store. Moreover, such actions when prices of goods are presented by comparing them with higher prices bearing no reflection of reality grants UAB KOMEKSIMAS a competitive advantage against other online traders.

The KT draws attention to the fact that it is a common practice in various online stores to promote one’s offers by introducing the relevant price of the product alongside the crossed out price without any explanation, which in turn may mislead consumers and determine their choice to purchase goods in that specific online store. In the future, the KT is determined to carefully evaluate the advertisements promoted in the online stores and, thus, ensure that the information provided in those advertisements is correct and indicated prices are grounded on real factual data.

Notice

Misleading advertising means advertising which in any way, including its presentation, misleads or is likely to mislead the persons to whom it is addressed or whom it reaches and which, by reason of its misleading nature, is likely to affect their economic behaviour or which, for those reasons, harms or is likely to harm another person’s capabilities to compete (Law on Advertising, Article 2(4)).

Communication Division