NMa imposes fines on two Dutch energy providers for door-to-door-selling practices

The Netherlands Competition Authority (NMa) today imposed fines on two Dutch energy providers for customer-recruitment methods they used in early 2010, involving door-to-door selling. Energy provider Greenchoice is fined more than EUR 2 million, while energie:direct is fined more than EUR 1 million. Many consumers these two energy providers had approached were not aware that they were actually agreeing to switching energy providers. On the basis of the door-to-door salesperson's story, consumers were under the impression that they were agreeing to receiving a discount on their energy bills from their current providers or to receiving an information packet.

'Play by the rules'
Jaap de Keijzer, member of the Board of the NMa, reacts: 'Door-to-door selling in itself is a good way to recruit new customers. However, when companies use this method, we feel it is important that everybody plays by the rules. Consumers must be able to trust the offers energy companies give them. That is why the NMa is taking firm action in this case.' It is in everybody's interest that the energy market continues to be dynamic. That way, energy companies keep each other on their toes, resulting in consumers getting the best deals and best service. The NMa believes that fair competition is a critical condition for a dynamic market. The level of the fines already reflects the measures that both companies have taken in order to prevent future violations.

Violations are not accidental
In January 2010, Dutch consumer-watchdog show 'Kassa' reported extensively on the door-to-door sales methods of energy companies. Around that same time, the NMa and the Dutch Consumer Authority (CA) opened an online complaints office regarding door-to-door selling, triggered by the various indications they had been receiving about potential abuses with regard to door-to-door sales practices by energy companies. As a result of these indications, both the NMa and the CA launched investigations. In its investigation, the NMa found out that the violations at Greenchoice and energie:direct did not involve a couple of customer-recruitment sales pitches that have accidentally gone wrong, but that they actually involved situations that were far more serious. Many consumers were not aware that they were actually signing a contract with another energy provider. In addition, these companies failed to adequately inform these consumers about important conditions of the contract on, for example, contract duration and cancellation options. The CA will be finishing its investigation soon.

Background information
Door-to-door selling is a legal customer-recruitment method. It is important that a door-to-door salesperson is able to identify himself/herself, and to clearly explain what individuals sign up for. More information on door-to-door selling and on consumer rights in door-to-door sales can be found on www.consuwijzer.nl (in Dutch).

Objections and appeals can be filed against the fines imposed by the NMa.