Costs of transferring the vehicle from the manufacturer to the dealer is an integral part of the final price

The question referred for a preliminary ruling to the Court from the German Federal Court of Justice was whether an advertisement published in the press by the company offering vehicles was in accordance with the Directive 98/6/EC of the European Union and of the Council of 16 February 1998 on consumer protection in the indication of the prices of products offered to consumers.

The advertisement contained inter alia the following information: “e.g. Citroen C4VTI 120 exclusive: EUR 21 8001”, “all options included in the price”, “Maximum saving: EUR 6 1701. The superscript ‘1’ referred to the information placed at the foot of the advertisement: “ price plus transfer costs of EUR 790[…]’. However, there was no indication of the final price in the advertisement that would include the cost of transferring the vehicle from the manufacturer to the dealer that the customer was obliged to pay in order to acquire the vehicle.

Firstly, the Court considered that in the case of an advertisement for a product it is necessary to indicate the prices within the meaning of the Directive. The selling price must stipulate the unavoidable and foreseeable elements of the price that are obligatory imposed on the consumer and that constitute pecuniary consideration in exchange for acquisition of that product.

Therefore, if the trader requires the consumer to cover the costs of transporting the vehicle from the manufacturer to the dealer, then those costs constitute an element of the final price within the meaning of Article 2(a) of the Directive and they must be differentiated from the additional costs of transportation or costs of delivery to the place chosen by the consumer that may not be qualified as unavoidable and foreseeable component of the final price.

Taking above into consideration, the subject costs should be included in the selling price of the vehicle in the advertisement published in the press, if the advertisement constitutes an offer in the eyes of the consumer.

Moreover, the Court considered the Directive 98/6/EC in conjunction with the Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market. Even though the Directive 2005/29/EC refers to  traders’ practices before the commercial transaction takes place, while it is taking place or after it has taken place and the definition of commercial transaction refers to commercial communication, including advertising and marketing, it is the Directive 98/6/EC that regulates the specific aspects of commercial practices that indicate the selling price in the invitations to purchase and in advertisements. Therefore, specific aspects of unfair commercial practices such as unfair indication of the selling price in the advertising is regulated by the Directive 98/6/EC.

  • Judgment of the European Court of Justice of 7 July 2016, case C – 476/14