On May 28, 2022, the new Consumer Protection Act came into force. The 2014 Act of the same name has been replaced by a new one, due to the transposition of Directive (EU) 2019/2161 of the European Parliament and of the Council of 27 November 2019. The main goal is to regulate consumer protection.
The most important change concerns the way in which product prices are expressed over the life of a particular form of sale (eg promotional sales). The new rules concern retailers, but also consumers who need to cope with the new presentation of prices. We are aware of the unfair business practices of retailers, which are additionally regulated by this Act in the area of price highlighting during seasonal discounts and misleading advertising.
Therefore, in several chapters and through examples we will explain what exactly is changing, in what way, and how it will affect traders and consumers, but also how prices will stand out with the introduction of the euro.
Retail price highlighting
The basic rule of highlighting prices states that retailers must indicate retail prices and unit prices of products, which the new Act has not changed. The final price for an individual product or service expressed in HRK, including taxes and other public levies, is considered the retail price. In contrast, we have the final price in kuna for one kilogram, one liter, one meter, one square meter, or one cubic meter of product or some other unit of quantity that is generally used in the sale of products in certain areas of Croatia (eg piece, dozen, measure, dose, etc.), and is called the unit price.
Highlighting prices for special forms of sales
The new Consumer Protection Act requires retailers that during special forms of sale, such as sales at lower than regular prices (promotional sales, sales, seasonal discounts, sales of defective products, and sales of expired products), they must highlight the following prices:
- reduced price and
- the lowest price of that same product recorded in the last 30 days before the special form of sale.
From this, it can be concluded that in the case of a special form of sale it is no longer possible to express the regular price of the product but a new reduced price and the lowest price of the same product in the last 30 days.
Example:
| DURING SPECIAL FORMS OF SALE(prices lower than regular ones): | |||
|---|---|---|---|
| IT DOES NOT HAVE TO BE EXPRESSED | IT MUST BE EXPRESSED | IT MUST BE EXPRESSED | |
| Regular price | Discount price | The lowest price in the last 30 days before the special sale | |
| EXAMPLE: Sunflower oil 1L | 18,99 HRK | 16,99 HRK | 17,99 HRK |
This obligation applies to sales in physical stores, but also in the case of online sales. Ultimately, this approach will prevent retailers from raising prices a few days before the discount to make the discount bigger than it is.
If the promotion only applies to a specific card during payment, then the merchant does not have to show the lowest price in the last 30 days. In this case, it is best to point out the percentage discount on the use of a particular card without showing the amount of the price.
Also, in the case of the sale of digital content, related offers, and value programs, the obligation to display the lowest price does not apply.
How will prices stand out with the introduction of the euro?
The Republic of Croatia should soon begin the process of adjusting the introduction of the euro as its official currency. The double presentation of prices of goods and services in kuna and euros is planned for 5 September 2022 until 31 December 2023. After that date, prices will be expressed only in euros.
With the introduction of the euro, traders and buyers will find as many as four prices. Namely, in physical and online stores in the case of special promotions or discounts, it will be necessary to highlight as many as four prices, as follows:
- action price expressed in HRK,
- action price expressed in euros,
- the lowest price in the last 30 days in HRK and
- the lowest price in the last 30 days in euros.
The initial confusion of retailers and consumers will be alleviated by a well-prescribed visual of dual pricing. The primary price will be in euros and will be displayed on the left or above, and the price in HRK will be displayed on the right or below. Behind the price for euros will certainly be the sign for the euro.
Prohibition of advertising and sale of products of the same name, but different qualities
The new law further emphasizes that it is forbidden to place goods on the market and to advertise that they are identical goods on the markets of other countries, although they differ in characteristics and composition. It is important to note that on the Croatian market as much as a third of the products are of poorer quality than the German versions of the same products.
Complaint process
The treatment of customer complaints so far has proved to be lengthy and complicated. The new Act obliges the trader to respond to the consumer’s complaint with specific information whether he accepts the complaint or not. So far, the answers of traders have often been unclear and the process has often been unnecessarily lengthy. The novelty is that from the day of receiving the complaint, the trader must respond within 15 days with an answer to the question of whether he accepts the complaint or not.
Advantages of the new Consumer Protection Act
The new law will effectively prevent unfair business practices of traders. In addition, it will respond to the new challenges and crisis times of the coronavirus pandemic, which has brought with it greater demand for online shopping and rising prices.
These legal measures belong to the protection of consumer rights and have been adopted to make the presentation of prices as transparent as possible.
