The Competition and Consumer Commission of Singapore (“CCCS”), which oversees consumer protection and anti-competition practices in Singapore, has published a set of guidelines on how suppliers should transparently and accurately price their products so as not to mislead consumers.
Overview of Singapore’s consumer protection laws
The Consumer Protection (Fair Trading) Act (“CPFTA”) is Singapore’s main consumer protection legislation, which is administered by the CCCS.
Under section 4 of the CPFTA, suppliers are prohibited from “unfair practices”, which include acts where a supplier:
- does or says anything, or omits to do or say anything, if as a result a consumer might reasonably be deceived or misled;
- makes a false claim;
- takes advantage of a consumer if the supplier knows or ought reasonably to know that the consumer is not in a position to protect his/ her own interest; or
- performs any prohibited action listed in the Second Schedule of the CPFTA. In relation to pricing, this includes: (i) representing that a price benefit exists for goods or services where it does not, (ii) representing that goods or services are available at a discounted price for a period of time if the supplier knows that such discounts will be actually be available for substantially longer, (iii) representing that goods or services are available at a discount for a particular reason that is different from the fact.
Guidelines on Price Transparency
The Guidelines on Price Transparency (“Guidelines”) outline how CCCS would enforce the CPFTA in relation to a supplier's pricing practices. It highlights infringing conduct and specifies measures that suppliers should take to ensure their pricing practices are not misleading and in compliance with consumer protection law.
The Guidelines will be effective from 1 November 2020 and will apply to all suppliers, whether operating online or in physical stores.
Some key points in the Guidelines are available here.
If a supplier fails to comply with the Guidelines, a consumer will have a direct right of action against the supplier. The court may impose remedies such as: awarding damages to the consumer; ordering specific performance against the supplier; or ordering the payment of money, property or other consideration furnished by the consumer (Section 6 and 7(4) of the CPFTA). Further, CCCS has the power to apply for an injunction against a supplier who has, or is likely to engage in an unfair practice (section 9 of the CPFTA), and will be guided by the Guidelines in determining whether a supplier has engaged in an unfair practice.
The Guidelines follow from CCCS’s findings from a market study it conducted on the online travel booking industry in Singapore, which highlighted consumer protection concerns in the areas above. Prior to the release of the Guidelines, CCCS had also investigated a local eatery in 2019 for its misleading marketing practices. The eatery promoted that their discounted meals were available “for a limited period only” or would be “Ending Soon! 50% Discount” when they continued to be available for at least 2 more years.
The Guidelines are useful in outlining the ‘dos’ and ‘don’ts’ for suppliers when they implement their pricing strategies. Suppliers will need to be cautious when pricing their products, and should review their current pricing or marketing structure to ensure they comply with the Guidelines.
This article is produced by our Singapore office, Bird & Bird ATMD LLP, and does not constitute legal advice. It is intended to provide general information only. Please contact our lawyers if you have any specific queries.