Consumer Authority penalises Greenchoice for misleading doorstep selling
The Consumer Authority has imposed penalties of a total of EUR 525,000 on the Greenchoice (energy supplier) for misleading doorstep selling. During the period from October 2009 to August 2010 the company called at the doors of a large number of consumers throughout the Netherlands to sell energy contracts. When it did so, Greenchoice did not comply with a number of rules governing doorstep sales. The company made misleading statements about discounts and about the the amount of the transfer penalty consumers risk on changing from their existing suppliers. In addition, many consumers were not informed about the rule requiring a cooling-off period for doorstep sales. Bernadette van Buchem, Director of the Consumer Authority, notes: “Doorstep selling, by very nature, take consumers by surprise. Consumers standing at their door are expected to assimilate a great deal of information in a very short time and make an immediate decision with far-reaching consequences. This imposes stringent requirements on companies that use doorstep selling as a marketing method. Greenchoice failed to take this sufficiently seriously.”
Background to the decision
At the end of 2009 and the beginning of 2010, there was great deal of unrest about the marketing methods used by (energy suppliers). ConsuWijzer received a large number of reports and the Vara broadcasting company’s Kassa consumer TV programme devoted a broadcast to the issue in January 2010. Questions were also asked in the House of Representatives of the States-General. The then Minister of Economic Affairs, Maria van der Hoeven, requested the Netherlands Competition Authority (NMa) and the Consumer Authority to carry out an investigation. This revealed that consumers had submitted many reports about Greenchoice. This gave cause to a further investigation of this company.
The Consumer Authority supervises compliance with the general rules governing all doorstep sales. The NMa supervises compliance with the Electricity and Gas Act, which lays down specific rules governing sales of energy contracts. The NMa has imposed penalties for the violations of the Electricity and Gas Act. The Consumer Authority has now imposed a penalty for the other violations. Consequently, the company is not being penalised twice for the same violation.
The Consumer Authority has penalised the following violations:
- providing incorrect/misleading information about discounts, refunds or savings on energy bills
- failing to provide information about a transfer penalty whilst the provision of this information is mandatory pursuant to the Gedragscode Consument en Energieleverancier (‘Consumer and Energy Supplier Code of Conduct’) that also govern Greenchoice
- failing to state or make clear that consumers accepting doorstep selling sales are entitled to an eight-day cooling-off period
- imposing pressure on consumers by stating that the discount was applicable solely to immediate decisions, whilst this was not the case.
Greenchoice can lodge an objection against this decision.