Yesterday, the Authority for Consumers and Markets (“ACM”) reported that it has imposed a € 745,000 fine on a Dutch publishing company for violating rules regarding unfair commercial practices – such as sending unsolicited follow-up shipments -, telemarketing and distance selling. A striking detail is that not only the company was fined, but the ACM also imposed a € 300,000 fine on the ultimate shareholder for exercising de facto leadership with respect to the violations.
In short, the background of the case is as follows.
In the period from 2011 to 2013, the company approached a great number of consumers through telemarketing, its website and by regular mail with the aim to sell a trial package for a low amount. After the sale, consumers received follow-up shipments unsolicitedly, for which they had to pay.
Furthermore, offers were presented to be free of charge – which was not the case -, clear information regarding the company’s offers was withheld and consumers were asked for a direct debit authorization, which is not allowed for this type of telephone sales.
Lastly, the company did not provide mandatory information about the purpose of the call, meaning that consumers did not have sufficient information to decide whether or not they wanted to continue the conversation.
Despite warnings issued by the ACM in response to several complaints the ACM received from consumers, the company did not follow up on its commitment to reorganize its sales operations and to monitor its call centers more strictly. This made the ACM to decide to investigate the matter and subsequently, to impose fines. The ultimate shareholder was fined for the fact that it was aware of the ongoing violations and failed to take actions against it.
The company lodged a notice of objection to the decision of the ACM.
Please click here for the report issued by the ACM.