Consumer Authority: over half a billion euros lost as a result of unfair commercial practices

The loss suffered by Dutch consumers as a result of so-called 'unfair commercial practices' amounts to a minimum of EUR 579 million per year. Two thirds of Dutch people aged 18+ have come into contact with at least one unfair commercial practice over the past year. Also over the past year, over two million consumers have become victims of at least one unfair commercial practice. These are the findings of a study that was commissioned by the Consumer Authority into the nature and extent of unfair commercial practices in the Netherlands.

According to Mr Heemskerk, the Dutch State Secretary for Economic Affairs, who received the report today, the study shows that the Wet Oneerlijke Handelspraktijken [Unfair Commercial Practices Act] which was passed recently is not a superfluous luxury when it comes to protecting the consumer. This new Act will enable the Consumer Authority to adopt a tough approach towards practices of this kind and to impose fines up to a maximum of EUR 450,000 per violation. "If the Consumer Authority is to achieve this, it is important that consumers also actually report complaints at www.consuwijzer.nl." According to Heemskerk, "offenders can only be dealt with effectively if complaints are made".

The European Commissioner for Consumer Affairs, Meglena Kuneva, welcomes the Consumer Authority's efforts to guarantee effective enforcement of the Unfair Commercial Practices Act. Ms Kuneva explains: "The study demonstrates the necessity of enforcing the Unfair Commercial Practices Act effectively, and it has now been revealed that Dutch consumers fall victim to unfair commercial practices on a large scale."

Unfair commercial practices that have been investigated

The study, in which over 70,000 respondents took part, focussed upon a number of unfair commercial practices that fall within the Consumer Authority's field of activity. The following practices were investigated: so-called 'free' products, misleading health claims, misleading lotteries, misleading sweepstakes, misleading or aggressive telephone sales, misleading or aggressive door-to-door sales practices, misuse of expensive telephone numbers, unsolicited mail, pyramid structures, misleading holiday clubs and misleading and aggressive sales practices during bus journeys.

Victims

Anyone can be a target of unfair commercial practices. There are no specific groups that are approached more or less frequently than others in the case of the unfair commercial practices that are being investigated. It has however emerged that certain groups become victims of specific unfair commercial practices somewhat more frequently than others. The victims include people of all different ages. There is however a group of chronic victims who have become victims of four or more unfair commercial practices. In this group, people from the lower income bracket are represented more than average. In the U.K. the saying: "There is a scam for everyone" is a familiar one, and the same has been found to apply to the Netherlands, too.

Losses

The total losses incurred by consumers as a result of the eleven practices that have been investigated are estimated at EUR 579 million per annum. The average loss per adult Dutchman/woman is estimated at EUR 45 per annum. The loss amount is presumably (considerably) higher, as not all conceivable practices were included in the study.

What is noticeable is that the majority of consumers, whether they were targets or victims, did not take any action as a result of their experience. The number of reports made to official bodies is minimal. This picture corresponds to the picture in our neighbouring countries. Those consumers who were targets or victims of unfair commercial practices say however that their attitude and behaviour has been changed by this experience. Over half say that they have become more suspicious.

Marije Hulshof, Director of the Consumer Authority, concludes: "Everyone in the Netherlands can become a victim of unfair commercial practice, and that forms one of the main conclusions of this study. Unfair commercial practices take place all around us, every day, even if the person involved is not even aware of it. Furthermore, consumers do not report or rarely report these experiences. As a result, unfair commercial practice largely remains unseen, which is also one of the benefits of this study: the fact that we have gained an insight into the nature and extent of this problem. The Consumer Authority must focus upon two issues: raising awareness amongst consumers by means of our ConsuWijzer desk and dealing with the offenders. We are making space for this in our diary for 2009."