Black Friday is Coming - Legislative Amendments in Poland

There have been discussions for some time about changes in consumer law in Poland. The amendments are aimed to counteract false promotions - where prices of goods are raised only to be lowered to the initial level shortly. Some stores get involved in such practices e.g. during mid-season sales or Black Friday sales. 

Polish Office of Competition and Consumer Protection constantly controls commercial practices applied by entrepreneurs. The information about such practices can also be obtained from consumers, who file complaints and notify the Office about the irregularities noticed.

If an infringement is confirmed, the Office may impose a fine on the trader and indeed it often uses this possibility, e.g. in 2020 one of the companies organizing false promotion was fined PLN 1.6 million (approx. EUR 350,000) for pointing out false pretexts of meetings, non-existent prizes and illegal promotions. 

Regardless of observed market practices, the main incentive for commencing work on amendments to the Polish Consumer Rights Act of May 2014 and certain other laws is the obligation of EU member states - including Poland - to implement the provisions of an EU directive, known as the "Omnibus Directive". Its purpose is to amend four directives protecting consumer interests. Member States were required to adopt the laws necessary to implement this directive by November 28, 2021, and the implemented provisions are to enter into force as of May 28, 2022. The Omnibus Directive provides for "more effective, proportionate and dissuasive sanctions for widespread cross-border infringements."

Key changes

Fundamental changes will be made to several important laws, including the Law on Price Information of Goods and Services, the Law on Consumer Rights, the Law on Counteracting Unfair Market Practices, and the Law on Competition and Consumer Protection. The bill provides, among others:

• that sellers, in case of reduction in the price of goods, will be required to provide, together with information about the reduced price, information about the lowest price of that good or service applied within 30 days before the introduction of the reduction,
• if a good or service has been offered for sale for less than 30 days, it will be necessary to indicate the lowest price for that good or service between the date on which it was offered for sale and the date of the reduction, in addition to the reduced price,
• introducing new definitions of product, placement, online trading platform,
• allowing consumers to withdraw from certain off-premises or distance contracts for the provision of health services,
• prohibition of concluding financial services agreements with consumers during  off-premises meetings, including excursions, attended directly or indirectly by a number of consumers, organized for the purpose of promotion, offering for sale or selling goods or services (demonstration). In order to determine whether a meeting is in fact a demonstration  it is irrelevant whether transport to the meeting has been arranged by an organizer. However, the provisions will not apply to contracts concluded during demonstrations organized at the place of residence or temporary stay of the consumer at his express invitation.

Broader information obligations, greater responsibility of entrepreneurs

The amendment will modify a catalog of material information that a trader must provide to consumers. Currently, it is considered an "unfair market practice" consisting in misleading omissions if an entrepreneur omits material information which is needed by the average consumer to take a decision regarding the contract and thereby causes or may incline the average consumer to take a decision regarding the contract which would not have been taken otherwise. When the bill is adopted, "material information" in the case of an offer to purchase a product will also be considered, in the case of a trader who provides access to consumer reviews of products, information about whether and how the trader ensures that the published reviews come from consumers who have used or purchased the product. 

New unfair market practices

The catalog of market practices that are deemed unfair in all circumstances will also be expanded. New grounds for unfair market practices include:

• provision of access to consumer reviews of products claiming that such reviews have been posted by independent consumers who have used or purchased the product, even though the trader has not taken reasonable and proportionate steps to verify that the reviews originate from those consumers,
• posting or causing another person to post false consumer opinions or recommendations, or distorting or causing another person to distort consumer opinions or recommendations, for the purpose of promoting products.

The new provision will also regulate trader's conduct in connection with any marketing of a good in one Member State to qualify as misleading if it is identical to a good marketed in other Member States, where the good is materially different in composition or properties, unless there are reasonable and objective factors for doing so.

Financial penalties

Failure to comply with the obligation to inform about changes in product prices within the 30-day period referred to above will, as is currently the case, result in a fine imposed by the Trade Inspection of PLN 20,000 to PLN 40,000 (EUR 4,500 – EUR 9,000). In turn, the President of the Office of Competition and Consumer Protection will be able, in certain cases, to impose on an entrepreneur a fine of the equivalent of up to EUR 2,000,000. 

Mitigating and aggravating circumstances for the liability of entrepreneurs.

The bill provides that when determining the amount of the aforementioned fines the President of the Office of Competition and Consumer Protection will take into account mitigating or aggravating circumstances that occurred in the case. In turn, in the case of a violation of the prohibition of practices infringing collective consumer interests or the use of prohibited provisions of standard contract terms, the President of the Office may also take into account sanctions imposed on the entrepreneur for the same violation in other Member States in cross-border cases, if information on such sanctions is available under the mechanism established by Regulation (EU) 2017/2394 of the European Parliament and of the Council.

The bill states that it shall enter into force 3 months after the date of promulgation, but the date of adoption of the law and thus the date of its entry into force is not yet known.