Price Reductions: Transposition of Directive (EU) 2019/2161 (the “Omnibus Directive”) in Italy
Laura Carrara from Mondini Bonora Ginevra discusses new rules concerning price-reduction advertisement in Italy.
Directive (EU) 2019/2161 (the “Omnibus Directive”) introduced into the Italian legal framework a number of changes that have had an impact over consumers’ contracts/consumer protection measures, and over the diligence requirements for food- and non-food business operators. In this context, the main issues have emerged in connection with the new rules concerning price-reduction advertisement. The following section offers a few initial observations on the main regulatory changes introduced, and the application limits of the Italian Decree transposing the Omnibus Directive.
“Every price reduction announcement must contain indication of the lowest price previously applied by the same trader over the 30 days prior to the application of the price reduction.”
Legislative Decree No 26 of 7 March 2023 (hereinafter, the “Decree”), transposing Directive (EU) 2019/2161 (also known as the Omnibus Directive), was published in the Official Gazette No 66 of 18 March 2023. This Decree is aimed at transposing into national law Directive (EU) 2019/2161, which modernised the consumer protection regulations contained in four earlier Directives regarding, respectively, price indications on consumer products (Directive 98/6/EC), unfair commercial practices (Directive 2005/29/EC), consumer rights (Directive 2011/83/EU), and unfair terms in consumer contracts (Directive 93/13/EEC). The above transposition entailed changes to Legislative Decree No 206/2005 (the “Consumers’ Code”), which will be briefly outlined below.
The changes entered into force on 2 April 2023, with the exception of regulations on price reductions, introduced as of 1 July 2023.
The Decree closely follows various points clarified in Commission Notice 2021/C526/02, specifically providing clarifications regarding price reduction announcements through the new Article 17-bis of the Consumers’ Code, which provides for specific sets of rules based on the category of goods involved and the price-reduction practice at issue. The new price reduction regulations are detailed in Article 17-bis of the Consumers’ Code, which provides guidelines on both price discount calculations and on discount presentation and promotional techniques, adding to the general price regulations previously in place. Every price reduction announcement must contain indications of the lowest price previously applied by the same trader over the 30 days prior to the application of the price reduction. In Italy, the Ministry further clarifies, in line with similar affirmations issued by the European Union, that the “prior price” to be taken as reference for the purpose of making a price reduction announcement is the lowest price applied to the general public over the 30 days prior to the application of the price reduction, in the online sales channel or single physical point of sale (eg, online price and offline price for in-store sales) where the goods are purchased.
Exceptions
The obligations introduced by the new regulations do not apply to the following products:
- agricultural and food products which, due to their very nature or during their transformation phase, may become unfit to be sold 30 days after being picked, produced or transformed;
- meat-based products with one of the following physical-chemical characteristics: aw over 0.95 and pH over 5.2, or aw over 0.91 or pH equal to or over 4.5;
- pre-packaged products featuring an expiry date or a minimum conservation time not exceeding 60 days;
- non-packaged products, including when placed in protective wrapping or refrigerated, not being treated to extend their shelf-life for a period of over 60 days;
- any type of milk; and
- all below-cost sales.
Fines
Anyone acting in violation of the above provisions is subject to the administrative fine provided for under Article 22, paragraph 3 of Legislative Decree 114/1998 (fine ranging between EUR516.46 and EUR3,098.74), imposed in the manner prescribed therein. The following criteria are taken into account:
- nature, seriousness, extent and duration of the violation;
- actions taken by the trader to minimise or remedy the damage;
- advantage obtained by the trader in consequence of the violation; and
- any other aggravating or mitigating factors, including any past violations.
With the provision establishing a prohibition against unfair commercial practices, the Italian Antitrust Authority (Autorità garante della concorrenza e del mercato) furthermore imposes the application of an administrative fine ranging today from EUR5,000 to EUR10,000 (Article 27, paragraph 9 of the Consumers’ Code).
Misleading Omissions and Contract-Related Matters
The Decree also extends the list of misleading actions (Article 21 of the Consumers’ Code), misleading omissions (Article 22 of the Consumers’ Code) and commercial practices deemed in any case misleading (Article 23 of the Consumers’ Code), including the following cases:
- dual quality (Article 21, paragraph 2, letter b-bis of the Consumers’ Code);
- other misleading omissions in the context of an invitation to purchase (Article 22, paragraph 4, letter d, e-bis of the Consumers’ Code);
- classification of the goods and services offered and positioning on search engines (Article 22, paragraph 4-bia; Article 23, paragraph 1, letter m-bis of the Consumers’ Code);
- false consumer reviews and verification requirements (Article 22, paragraph 5-bis; Article 23, paragraph 1, letter bb-ter and bb-quater of the Consumers’ Code); and
- secondary ticketing (Article 23, paragraph 1, letter bb-bis of the Consumers’ Code).
From the point of view of consumer protection in contract-related matters, the Decree introduces changes in the following areas:
- new definitions – sales contract, digital services and goods;
- unfair clauses – where the Italian Antitrust Authority confirms that unfair clauses, as defined in Article 33, paragraph 1 of the Consumers’ Code, are being used, an administrative fine is applied in the measure established in Article 27, paragraph 9;
- new contractual obligations – for cases other than distance contracts or contracts negotiated away from business premises (Article 48 of the Consumers’ Code), for distance contracts and for contracts negotiated away from business premises where information obligations have been complied with in part (Article 49 of the Consumers’ Code);
- new/supplementary information obligations – the obligations for online market providers are laid down in new Article 49-bis of the Consumers’ Code; and
- right of withdrawal – changes to certain withdrawal scenarios (Article 59, paragraph 1 of the Consumers’ Code).
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