Belgian law traditionally has rather elaborate and strict rules on the announcement of price reductions. A law of October 2015 implements a striking change as a consequence of and in implementation of a ruling of 10 July 2014 of the European Court of Justice (ECJ) where Belgium has been condemned because, among others, the stipulations on announcements of price rebates in the Act on Market Practices of 6 April 2010 were found to infringe upon the Directive 2005/29/EU on unfair market practices.

The long lasting Belgian rule more specifically provided that any announcement of a price reduction must refer to a price defined by law, which is the lowest price applied throughout the month prior to the announcement of the price reduction. The traditional Belgian restriction also prohibits a price reduction from lasting for more than a month and provides that announcement of price reductions may not last for less than a day.

The European Commission alleged against Belgium that Directive 2005/29 has fully harmonized the rules governing unfair commercial practices and that the Directive precludes more restrictive national provisions such as those referred to in the preceding paragraph.

The Directive foresees that commercial practices which are not deemed to be unfair in all circumstances (an exhaustive list of 31 of those practices is enumerated in the Directive) should be assessed on a case-by-case basis in order to determine whether they are unfair. Rules on price reductions are not among the list in all circumstances of unfair practices. The Commission found that the Belgian law has as effect the prohibition of the announcement of price reductions where the strict conditions contained in the Belgian law are not met, even where such practices may not, examined individually, be considered misleading or unfair within the meaning of Directive 2005/29

The ECJ ruled that indeed Directive 2005/29 carries out a complete harmonization at EU level of the rules concerning unfair commercial practices of undertakings vis-à-vis consumers and that Member States may not maintain or adopt more restrictive national measures than those laid down in that directive., even where such measures are designed to ensure a higher level of consumer protection.

The ECJ ruled that Belgium has failed to fulfil its obligations under Directive 2005/29 by maintaining in force some of those restrictions, to wit the obligation to refer – when announcing a price reduction – on the one hand as reference price the lowest price applied in the month preceding the price reduction and on the other hand the limitation in time of the announcement of this price reduction to maximum one month. The Belgian legislator had, when the Act on Market Practices was inserted in Book VI the Code on Economic Law, taken over the same provisions on announcement of price reductions.

In execution of the judgment of the ECJ, Belgium abolished these articles altogether. This also counts for the similar restrictions on the referenced price for liquidation sales and for seasonal sales.

Hence, announcements of reductions of prices can last longer than a month, provided always that they do not mislead. What it in fact means is that the announcement has to remain fair and not mislead consumers on the price and the manner in which the price is being calculated or the existence of the specific advantage will be subject to discussion before courts.

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