Traders operate in a free market economy which means that there is no legislation that regulates how much products or services could be sold to consumers. The profit margin of retailers and suppliers is also not regulated. This allows competition among traders which usually results in more competitive prices for consumers. Consumers benefit from the free market economy when they shop around and compare prices. This way they ensure that they are getting the best value for their money.
Even though sellers are free to set their own prices, legally they are obliged to indicate with a price the products they display for sale. The Price Indication Regulations regulate how prices should be displayed to ensure that consumers can freely compare prices and make informed buying decisions. Appropriate price indication ensures that consumers can compare prices between different brands of the same products in an outlet and also with other outlets.
As a general rule, the Price Indication Regulations state that all goods displayed for sale must have their prices indicated clearly and accurately. The same rule applies to items displayed in shop windows.
Furthermore, the law stipulates that indicated prices should be unambiguous, easily identifiable and clearly legible. Hence it is not acceptable that price tags of products displayed in shop windows are hidden from the consumers’ vision.
These regulations also oblige sellers to indicate the prices in euro and the price indicated on products must be the same as the price charged at the cash point. This is also obligatory during sales and other promotions. Indicated prices must also include VAT and any other taxes or compulsory charges.
Proper price indication ensures that consumers freely compare prices and make informed buying decisions
When more than one item of the same kind, size, type or brand of the same goods are displayed for sale, the Price Indication Regulations provide that it is sufficient to show the price on just one of these items, or near them, such as for example on a label on the edge of a shelf where the product is displayed.
Sellers also have the obligation to indicate two prices on goods that are sold by unit weight or volume. One of these prices should display the actual price of the product for a given quantity, such as for instance 150 grams of ricotta. The other price should be the unit price, which is the price for one kilogramme, one litre, one metre, one square metre or one cubic metre of the goods. Consumers need these two prices because when they buy goods by weight or volume, it is only by comparing unit prices of different products that they can really compare one brand with another.
This rule also applies to pre-packed goods in pre-established or variable quantities. Regarding pre-packaged solid products preserved in a liquid medium, the price per unit shall refer to the weight of the solid good without the liquid in which it is contained. The unit price may be indicated in a smaller font than the actual selling price, but must still be clearly legible.
The regulations exempt sellers from the obligation to indicate prices where goods are supplied for the purpose of reselling, goods sold at an auction, goods provided in the course of a service and also works of art and antiques.
Traders are bound to ensure full compliance with these regulations. They are also responsible for any infringements made by people in their employment, violation of these regulations amounts to an offence and, if found guilty, traders are fined. In case of a second or subsequent convictions, traders can also have their trade licence suspended for a week.
The Enforcement Directortate within the Office for Consumer Affairs ensures that these regulations are observed by carrying out regular spot checks in retail outlets. Consumers may also ensure adherence to these regulations by reporting any lack of price indication by calling on freephone 8007 4400 or by e-mailing info@mccaa.org.mt.
Odette Vella is director, Information Education and Research Directorate, Office for Consumer Affairs, Malta Competition and Consumer Affairs Authority.
odette.vella@mccaa.org.mt