Unfair Commercial Practices Directive, Chapter 1, Article 2, (d) Unfair Commercial Practices Directive, Annex I, 1. Unfair Commercial Practices Directive, Annex I, 20.

It is an unfair commercial practice to advertise a service as "free" when in fact a consumer has to pay the standard rates for making use of such services and only receives a small amount of credit.

The defendant advertised its mobile phone services stating that consumers would be able to "freely communicate, write and speak for three months".

However, after purchasing the advertised service consumers had to pay for the services according to standard rates. There was only a small amount of credit transferred to the consumers’ accounts in first three months. This credit could then be used for telephone calls, short messages and internet browsing via the consumer's mobile.

The Council held that the defendant’s statements were misleading advertising under the regulation which had been in place before introduction of the unfair commercial practices regulation. Subsequently, it referred to the Lithuanian Law on Advertising pursuant to which an advertisement is in all circumstances regarded as misleading if it falls within the misleading part of the blacklist.

The Council pointed out that the complex analysis of the Lithuanian Law on Advertising, the Lithuanian Law on Prohibition of Unfair Business-to-Consumer Commercial Practices and the UCP Directive suggests that it is not necessary to prove the impact or possible impact of the said blacklisted practice on an average consumer’s economic behaviour. Accordingly, to determine the violation it is sufficient to prove that the presented information is advertising, the trader ordered publication thereof and it falls within the misleading part of the blacklist.

Describing a product as “gratis”, “free”, “without charge” or similar if the consumer has to pay anything other than the unavoidable cost of responding to the commercial practice and collecting or paying for delivery of the item, qualifies as the blacklisted misleading commercial practice. The Council recalled that a commercial practice will be considered unfair in all circumstances if the consumer has to pay anything other than the unavoidable costs, because otherwise the trader might create a false impression about itself, its goods or services.

The Council concluded that the consumer who bought the service advertised by the defendant could reasonably believe that he would be able to call, write and browse the internet three months for free, whereas in reality the consumer did not receive such free service, i.e. was forced to incur costs which cannot be considered unavoidable.

Is it an unfair commercial practice to advertise a service as "free" when in fact a consumer has to pay the standard rates for making use of such services and only receives a small amount of credit?  

URL: http://www.konkuren.lt/index.php?show=nut_view&nut_id=1181

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The defendant’s advertisements were concluded to be misleading under both regulations of misleading advertising and unfair commercial practices. A fine of LTL 10,000 (approx. EUR 2,857) was imposed on the defendant.