CMA to take action after finding evidence that some supermarket promotions are misleading shoppers
The Competition and Markets Authority (CMA) announced today that it plans to take action after its investigation into supermarket promotions found that some offers are misleading shoppers. .
In response to a super-complaint from consumer watchdog Which?, the CMA revealed a series of measures to improve compliance, bring greater clarity to shoppers and simplify the regulations. Which? submitted the super-complaint in April, raising concerns about potentially misleading special offers, unit pricing, price-matching schemes and changing pack sizes.
In its investigation the CMA found examples of pricing and promotional practices that it said have the potential to confuse or mislead consumers and which could be in breach of consumer law. It added that where there is evidence of breaches of consumer law it could take enforcement action, which includes heavy fines.
However, the CMA stressed that these problems are not occurring in large numbers across the whole sector and that generally retailers are taking compliance seriously. The CMA also found that more could be done to reduce the complexity in unit pricing to make it a more useful comparison tool for consumers.
The CMA said it will work with businesses to cut out promotional practices which could mislead consumers. This includes the practice of running ‘was/now’ promotions where the discount price is advertised as a promotion for longer than the higher price applied.
To improve compliance the CMA also recommended that, in its ongoing review of the ‘Pricing Practices Guide’, the Chartered Trading Standards Institute clarifies how the legislation applies to certain promotional practices. The CMA also recommended that the Department for Business, Innovation and Skills (BIS) publishes best practice guidelines on the legibility of unit prices, and looks at ways to simplify and clarify legislation, including how the law requires items to be unit-priced when they are on promotion.
Nisha Arora, CMA Senior Director, Consumer, commented: “We welcomed the super-complaint, which presented us with information that demanded closer inspection. We have gathered and examined a great deal of further evidence over the past 3 months and are now announcing what further action we are taking and recommending others to take.
“We have found that, whilst supermarkets want to comply with the law and shoppers enjoy a wide range of choices, with an estimated 40% of grocery spending being on items on promotion, there are still areas of poor practice that could confuse or mislead shoppers. So we are recommending further action to improve compliance and ensure that shoppers have clear, accurate information.”
Responding to the CMA’s assessment of its super-complaint, Which? executive director, Richard Lloyd, said: “The CMA’s report confirms what our research over many years has repeatedly highlighted: there are hundreds of misleading offers on the shelves every day that do not comply with the rules. This puts supermarkets on notice to clean up their pricing practices or face legal action.
“Given the findings, we now expect to see urgent enforcement action from the CMA. The Government must also quickly strengthen the rules so that retailers have no more excuses.”