Garzón may sanction companies with up to one million euros in case of massive fraud


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The Ministry of Consumption will have sanctioning competition in cases of massive fraud that affect several countries or the market unit. As of its entry into force, the owner of Consumption, Alberto Garzón, may act as a sanctioning authority against those infringements that affect the unity of the market and competition, when they occur in several EU States or when the offender is not located in Spain in offenses in relation to electronic commerce.

In addition, the maximum sanctions, which from now on may also be imposed by the State, they will rise up to one million euros or eight times the illicit profit obtained In the case of infractions committed only in Spain, In addition, they will rise up to 4% of the turnover of the companies when these infractions take place in several Member States.

To quantify
the fine will take into account the economic capacity of the person in charge
, the degree of guilt or the existence of intent, the continuing nature of the offense, the number of consumers affected or the level of damages they have suffered, reported from Consumption. Likewise, in addition to the fine, there will be accessory sanctions such as the confiscation of merchandise, the closure of establishments for a period of up to five years and the publicity of the sanctions imposed, in order to influence its dissuasive nature.

Among other issues, non-compliance with the requirements to avoid contamination or harmful conduct that may be seriously detrimental to public health, as well as alteration and adulteration of the composition and quality of goods and services, will be punishable by the State.

Likewise, they will be subject to the new sanctioning regime. the introduction or maintenance of abusive clauses in contracts, the obstruction of the right to terminate a contract or cancel a service, breaches of the labeling or billing of non-contracted products and services.

As Garzón announced a few months ago, the autonomous communities will maintain the sanctioning powers that they assumed with the promulgation of the first version of the General Law for the Defense of Consumers and Users in 1984. That is, an autonomous consumer authority may continue to fine and taking action against fraud that affects consumers in different regions.

I stop covert advertising

With this reform, the unfair practice of reselling tickets to shows through ‘bots’ can also be prosecuted when they prevent all consumers from accessing the market normally. Along the same lines, the prohibition of covert advertising on social networks, until now not expressly regulated, and the publication of false or manufacturer-paid reviews and evaluations on products for sale on the internet are included. In this sense, the employer will have to guarantee that the reviews that appear come from consumers or users that they have actually purchased the good or used the service. In the reform of the law, it will be considered an unfair practice to include reviews from consumers without verifying that they have actually purchased the property or the inclusion of false reviews.

Likewise, the new regulations includes controls to online search engines when they give higher scores and evaluations to goods or services with respect to those of their competitors and do not inform consumers that their positioning responds to paid advertising. With the modification, search engines will have to display a description of the parameters used to rank the results. In the event that a price has been personalized for the consumer, based on automated decision making, this fact must be reported.

The reform also involves regulating the dual quality of products and considers it unfair to trade a good as identical when the products are different, to prevent certain brands from varying the quality of the same product depending on the Member State where they are sold.

Today the Council of Ministers approved the Royal Decree-Law modifying the revised text of the General Law for the Defense of the Rights of Consumers and Users (TRLGDCU) to adapt it to new forms of electronic commerce and regulate harmful business behavior for the rights of consumers who, until now, lack specific regulation.

With this reform, Directive (EU) 2019/216 is transposed into Spanish law for the improvement and modernization of the European Union consumer protection standards and the consumer sanctioning regime.

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