CCPC warns businesses must act independently when setting prices during reopening phase
July 1, 2020
- CCPC engages with trade associations following public statements to warn against co-ordination
- Any new prices & charges must adhere to competition and consumer protection law
- Consumers are entitled to have their rights and interests protected by law
Wednesday, 1st July: As many businesses across Ireland reopen this week, the Competition and Consumer Protection Commission (CCPC) is issuing a warning to businesses that, despite economic challenges, they must act independently in their commercial decisions, particularly when setting prices and charges. The warning comes on the back of engagement between the CCPC and a number of trade associations after they made public statements about new potential charges and price increases, which their members may apply. Businesses are also reminded that they have additional responsibilities under consumer protection law, when setting new or additional fees, or making changes to business practices.
COMPETITION LAW & PRICE COORDINATION:
As a result of the current crisis, businesses may be reviewing their prices or considering whether or not to introduce additional charges to cover the cost of providing a service which is in line with Government public health requirements. Businesses are free to do so, however the CCPC is reminding businesses that they must make such decisions independently and advise consumers of these costs before they make a purchase. Similarly, trade associations are free to advise their members on how to address the challenges they are facing. However, the practice of trade associations suggesting future prices, or coordinating ways of passing on costs to consumers, could constitute an infringement of competition law. As a result the CCPC has engaged with a number of trade associations in recent weeks to remind them of their obligations under competition law.
Isolde Goggin, Chair of the Competition and Consumer Protection Commission commented: “The CCPC is acutely aware of the new challenges that businesses across the country are facing at this time, however, businesses must be mindful that the rules set out by competition law remain unchanged. Whilst the CCPC recognises the importance of businesses and representative bodies working collaboratively in such unprecedented circumstances, it’s important for them to know that competition law still applies, even during a global pandemic. We remind all representative bodies that they must not attempt to co-ordinate the pricing decisions of their members. To do so could be detrimental to consumers and in breach of competition law. As the economy starts to re-open, we are closely monitoring the activities of businesses and similar representative organisations and, if necessary, the CCPC will take appropriate action to deter or stop any potentially anti-competitive behaviour.”
CONSUMER PROTECTION LAW REQUIREMENTS:
If businesses are making changes to their business practices, whether through changing their payment methods, adding additional charges or changing their prices, they are required to adhere to consumer protection law. This includes the requirement that businesses provide adequate and accurate information so that consumers can make informed decisions and exercise their consumer rights when necessary.
Ms. Goggin added; “….Consumers are entitled to have their rights and interests protected by law. Whilst the vast majority of businesses act in good faith and do not seek to take unfair advantage, in these challenging times there is a heightened risk that a small minority of traders may engage in commercial practices, which are damaging to consumers. If a business is introducing new prices or charges or making changes to business practices, they must be transparent and inform customers before they buy. We are active across the full scope of our remit and we will not hesitate to address business practices which cause harm to consumers as a result of a breach of either competition or consumer protection law.”
The CCPC has a range of guidance for businesses and trade associations available at ccpc.ie.
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