Unfair Commercial Practices Directive, Chapter 2, Section 1, Article 6, 1., (b) Unfair Commercial Practices Directive, Chapter 2, Section 1, Article 7, 1. Unfair Commercial Practices Directive, Chapter 2, Section 1, Article 7, 4., (c)

(1) The omission to mention general costs related to the purchase of real estate of which the average consumer must be aware, does not constitute a misleading omission, whereas the omission to mention other costs related to such purchase, constitutes a misleading omission.

(2) An advertisement, stating that a purchase subsidiary to a main purchase, is optional, whereas in reality the subsidiary purchase is mandatory, constitutes a misleading commercial practice.

 

This case relates to the advertisements by the defendants, building enterprises, concerning the sale of apartments in a residential area. In the advertisements, the defendants omitted to mention the additional costs related to a real estate purchase transaction, such as applicable taxes, costs of notary and costs related to the brokers through which the purchase was concluded.

In addition, it was stated that the consumers were given the possibility to purchase a garage box together with the apartment, whereas in reality, buyers were obliged to purchase such garage box.

 

(1) The Italian Competition Authority first notes that the average consumer is aware that the purchase of real estate will be accompanied with several additional costs which are always mandatory, such as the applicable taxes and notary costs. As a result, the omission to mention these additional cost in an advertisement, does not constitute a misleading omission.

Conversely, the Italian Competition Authority ruled, in absence of communication in this respect, an average consumer cannot be assumed to expect that the sale of the apartments will be performed through the intervention of a broker. Without any indication to the contrary, the consumer may reasonably expect to deal directly with the seller, hence to have no obligation to pay any additional broker costs. It was further stated that, although the buyer was informed on the intervention of a broker at the moment he contacted the defendants, the advertisements were misleading as they incited the consumers to take contact with the defendants.

(2) The Authority first established that, contrary to what the defendants stated, there was no doubt that the consumers were obliged to by one (or more) garage box(es) in case of purchase of the advertised apartments (all apartments sold were sold with garage box). In a short reasoning, the court stated that, taking into account the facts, advertising that the purchase of an additional garage was merely optional, was a misleading commercial practice likely to influence the transactional decision of the average consumer.

(1) Does the omission to mention the costs related to the purchase of real estate, constitute a misleading omission?

(2) Does the advertisement, stating that a purchase subsidiary to a main purchase, is optional, whereas in reality the subsidiary purchase is mandatory, constitute a misleading commercial practice?

 

URL: http://www.agcm.it/ricerca-avanzata/open/C12560D000291394/646E21C39A92F673C125781C004F1957.html

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Based on the gravity and duration of the practice, the Italian Competition Authority decided to impose a financial sanction upon the defendants which amounted to 230.000 EURO in total.