Consumer Ombudsman Clarifies Its Guideline for Indicating the Lowest Price in Price Reduction Advertisements

Authors: Anniina Somppi, Anna Mäkinen, and Hilma Mäkitalo-Saarinen

A new provision to the Finnish Consumer Protection Act (38/1978, as amended) on price reduction entered into force in January 2023, according to which the lowest price at which a product has been marketed during the 30 days preceding a price reduction must be indicated in the marketing. The provision originates from the so-called Omnibus Directive and thus applies in all EU Member States.

Since the new provision on price reduction became applicable, the Consumer Ombudsman has been paying particular attention to companies’ marketing of goods at a discount or at a reduced price. At the beginning of this autumn, the Consumer Ombudsman added clarifications and updates to its guideline for indicating the lowest price which are based on the Consumer Ombudsman’s supervisory work and recent EU-level case law.

Based on the Consumer Ombudsman’s guideline, the lowest price is essential information for the consumer, and it must be presented in a clear and comprehensible manner and be indicated regardless of the marketing channel in which the price reduction notice is published. The lowest price must be presented in such a way that the consumer’s attention is naturally drawn to it, and it must be easily available without the consumer having to take any special steps to find it. The guideline also includes visual examples on how the lowest price and the normal price can be presented. As most decisions regarding advertising are visual in nature, the imagery added to the guideline provides a clearer picture to companies on what the Consumer Ombudsman deems to catch the consumer’s attention adequately.

Below is a summary of the key updates to the Consumer Ombudsman’s guideline which you should be aware of when planning and designing the price reduction advertisements of your company:

• If specific goods are identified in a price reduction notice, the lowest price at which the goods in question have been marketed during the 30 days preceding the price reduction must also be indicated.
  • If specific goods have not been identified in a price reduction notice that is, for example, a price reduction for a larger group of unidentified goods, such as "all products –50%" or "all cosmetic products –20%", it is sufficient that the lowest price at which the goods were sold during the previous 30 days is clearly indicated (i) on the goods or on their packaging or (ii) on a separate label or price table placed in the immediate vicinity or in connection with the goods at the company’s point of sale and on the e-commerce website.
• Print marketing: The lowest price of the goods must be clearly stated in print marketing, which means that the lowest price cannot only be displayed on the company’s website. The lowest price in print marketing must be correct. Therefore, for example, the lowest price advertised in a newspaper cannot be reduced once the newspaper has gone to press, because that would lead to the lowest price advertised in the newspaper being inaccurate.
• Online marketing: In an online price reduction notice, the lowest price of the goods must be visible and cannot be placed, for example, behind a link.
• Presentation of normal price: A trader can also present a so-called normal price in a price reduction notice. The ‘normal price’ referred to in the guideline means the price previously charged for the same product (at the same point of sale). In practice, normal price is the usual price of the product without any price reductions. The normal price may be presented in a price reduction notice, provided that
  • the advertisement is not ambiguous or misleading with respect to the price advantage offered. This means that the normal price must not distract a consumer from the lowest price. Furthermore, the lowest price must be prominently displayed, and the normal price cannot be placed or displayed in such a way that it dominates the advertisement.
  • all prices are clearly explained. This means it must be clearly indicated that the normal price refers to the price usually charged for the product in question whereas the lowest price is the price at which the product has been marketed during the 30 days preceding the price reduction.

We are happy to assist you in any types of questions you may have related to marketing and consumer law.

The Finnish Consumer Ombudsman's Guideline on Price Reduction Announcements of Products (Available in Finnish)