Bulgaria competition watchdog fines online retailer eMAG for ‘Black Friday’ campaign

Written by on November 28, 2014 in Business - Comments Off on Bulgaria competition watchdog fines online retailer eMAG for ‘Black Friday’ campaign

Bulgaria’s Commission for Protection of Competition (CPC) ruled on November 28 that online electronic goods and household appliances retailer eMAG has breached fair-trade practices with its Black Friday sales event and another promotional campaign earlier this year, fining the company a total 758 380 leva, or about 387 750 euro.

CPC said that Romanian firm Dante International, which owns the eMAG online retailer, engaged in unfair trade practices when setting prices and offering discounts as part of the Black Friday campaign. Furthermore, the campaign slogans that customers had the largest number and highest price discounts on Black Friday were misleading customers, the regulator said.

The watchdog said it fined the company 551 550 leva, or four per cent of its sales revenue in 2013, for the breach of competition laws. The CPC decision was the result of an investigation into the 2013 campaign, with the announcement coinciding with this year’s Black Friday sales event by eMAG.

Separately, CPC fined eMAG 206 380 leva for the “1+1 gratis Tassimo” campaign earlier this year, in which the retailer offered customers a Tassimo coffee machine and a second one free of charge. The watchdog said that the offer exceeded the value limits on additional incentives as part of a sales event, namely the second coffee machine, allowed by Bulgarian law and “liable to skew the competitive environment”.

In a statement, the retailer said that it planned to appeal the decision and said that the watchdog’s fines were unjustifiably high. The company cited an internal survey that claimed 95 per cent customer satisfaction among those who purchased goods in last year’s sales event and said that it sold more than 70 000 items worth 6.3 million leva in the first three hours of this year’s Black Friday campaign.

Black Friday is the annual sales event in which major US retailers offer large discounts to shoppers on the Friday after the Thanksgiving Day holiday. In recent years, the practice spread outside North America to European countries, including Romania, where Dante International is based.

In Romania, eMAG made headlines earlier this week when a technical glitch on its website – during the Black Friday campaign but not related to it – on November 23 that resulted in goods being offered at price discounts of 99.9 per cent. The company said that it sold 730 products during a window of several hours and would honour all orders, even though the total value of discounts was about 250 000 euro.

(Screenshot of emag.bg website on November 28 2014, promoting the Black Friday sales event.)

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