Children’s toys are always on sale in November and December. Not very coincidental of course. But most of the time it’s not really an offer either. A few weeks earlier, the regular price of the product was often lower than the offer price in November. Prices and discounts should never be misleading, but until now it was the ACM that determined what was misleading. That will soon be a thing of the past, if there is a legal regulation.
New rules about discount
Since 28 May 2022, the Prices Act has been amend in response to European regulations. It now contains the following:
[There] may be rules regarding the disclosure of price reductions.
This was stat in the new version of the prices law that came into effect on May 28, 2022. This regulation (an Order in Council) will be issued, but has not yet been implemented.
The new arrangement has already be. It states that the ‘from price’ must be the lowest price of the past 30 days. That may sound simpler than it actually is. There are quite a few exceptions.
Don’t raise the price first and then lower it again
You can always ask the prices you want. The only thing that is not allow is to refer to the highest price you have ever ask.
Do you want to mention a starting price or a discount percentage? Then you have to calculate that from the lowest price you have ask in all 30 days before.
Suppose on October 1 the price was $100, on October 5 you lower it to $90 and on October 31 you lower the price to $89. Then you cannot say that you are giving a €11 discount. After all, the lowest price within 30 days was €90. The discount is therefore only €1.
If the product was €90 for a long time, it may therefore not be increas to €100 for a short time and then lower it again to €90 and thus be able to say that there is 10% discount. After all, the lowest price in those 30 days was already €90, so there is no question of a discount.
Exception if the price keeps getting lower
Are you holding a sale where the discount keeps getting lower? Then you can still keep mentioning the original price. In this way you can also say that there was only a 20% discount before and a 70% discount later.
You can keep naming the suggest retail price
What probably remains possible is to make a comparison with the suggest retail price. That is independent of the prices you have ask yourself. It is important that no starting price is mention, but that it is clear to everyone that this is a suggest retail price.
New products are allow on sale
There is also an exception for new Australia School Email Lists products that have been on the market for less than 30 days. This regulation will not apply to that.
The idea is that you should be able to easily sell new products at a discount, because this is better for everyone. Of course, the price should still not be misleading.
Exception for perishable goods
Perishable products are also exempt from the rule. The starting price may simply be the price that was used immediately before the discount. The idea behind this is that it is more important that we combat food waste and that you can therefore make it attractive to buy the products.
When do these rules come into effect?
The European rules should have entered into force from May 28, 2022. What I describe above was already approved by the Council of Ministers in May 2022 and was subsequently sent to the Council of State for advice, but the new rules have still not entered into force. It is unclear when this will happen. The rules can therefore also be adjusted a bit.