The Court of Justice of the European Union (CJEU) has ruled on advertising with price reductions. The Luxembourg judges have clarified that the discount stated by the retailer must refer to the lowest price offered in the (at least) last 30 days. The mere (additional) indication of the best price within this period is not sufficient (Judgement of 26/09/2024, file number: C-330/23). The legal question had been controversial, as the relevant legal regulations do not make a clear statement on these specific issues.

The CJEU’s decision is based on a referral from the Düsseldorf Regional Court. The Düsseldorf judges had to rule on a competition law complaint by the Verbraucherzentrale Baden-Württenberg e.V., which was directed against the design of price advertising by Aldi-Süd. The discounter had advertised bananas and pineapples as follows:

On the basis of EU law, retailers have to indicate the lowest price of the last 30 days as a reference for every price reduction (Art. 6a of the Price Indication Directive (Directive 98/6/EC)). The provision was implemented in Germany by Section 11 (1) Preisangabenverordnung (PAngV). In practice, however, the requirement leaves numerous questions unanswered, including the price to which the comparison needs to refer and the possible indication of additional price information. Neither the wording of the legal provisions nor the recitals of the directive provide any clear indications in this regard.

Provisions on discount advertising not clear

In this respect, the claimant took the view that simply stating the best price of the last 30 days in the advertising was not sufficient. Rather, the discount stated by the retailer must refer to this price.  Otherwise, the retailer in question could artificially generate a price discount by increasing the price immediately before the planned promotion. In fact, the consumer would therefore not receive the advertised discount at all. Aldi-Süd countered by pointing out, among other things, that the challenged price advertising showed the legally prescribed lowest price of the last 30 days.

Misleading by false reference?

In its decision, the CJEU essentially supported the position of the claimant. A price reduction in the form of a percentage must be calculated on the basis of the lowest price advertised by the retailer within a period of at least 30 days prior to the discount promotion. The mere provision of information about this price was not sufficient.  This was justified by the function of the according provision. It intends to prevent consumers from being misled by the fact that a product price is increased shortly before a price reduction is announced. To do so, it is necessary for the discount information to refer to the lowest price.

The case will now be referred back to the Düsseldorf Regional Court, which will have to decide on the action on the basis of the ECJ ruling.