New guidelines for transparent pricing kick in on Nov 1
Businesses that advertise prices misleadingly could run afoul of consumer protection laws
An airline customer was charged a $60 credit card processing fee that was not reflected on the sticker price.
In another case, a woman bought a pair of shoes online and was charged a recurring $51.35 fee as she had been unwittingly enrolled into a VIP membership.
Between 2018 and last year, the Consumers Association of Singapore (Case) received at least 246 complaints alleging such unfair practices, with the beauty, telecommunications and contractors industries getting the most flak.
With a set of guidelines published yesterday, the Competition and Consumer Commission of Singapore (CCCS) aims to stamp out these errant acts.
Businesses that advertise prices misleadingly could run afoul of consumer protection laws come Nov 1, when the watchdog's price transparency guidelines take effect.
These guidelines set out how CCCS will interpret and use the Consumer Protection (Fair Trading) Act (CPFTA) in relation to dubious pricing practices and give suppliers more clarity on what is considered an infringement.
They also set out how suppliers can comply with the law and minimise potential disputes with consumers.
First proposed in September last year after a CCCS study on dubious practices in the online booking sector, the guidelines were finalised after a public consultation and will apply to physical and online suppliers.
CCCS chief executive Sia Aik Kor said: "The guidelines help to build a credible marketplace... Consumers can make informed choices and shop confidently. Suppliers also stand to gain as fair trading practices can go a long way in building a solid reputation as a trusted trader."
The guidelines cover four main practices.
This is where prices advertised omit mandatory fees, or pre-selected add-ons.
CCCS said suppliers should ensure unavoidable or mandatory charges, such as taxes or service fees, are included in the headline price.
Where such fees cannot be calculated in advance, their existence should be clearly shown with the advertised price.
An "opt-in" or "opt-neutral" approach should be taken for add-ons.
This is where a price is advertised as having an advantage over a competitor when it does not. Suppliers should compare only prices of goods or services accepted to be similar or equivalent by consumers or trade norms, update reference prices regularly and keep records to prove the comparisons made are not misleading.
Time limits on discounts should be clearly stated and suppliers should keep records of past sales and prices to prove discounts given are genuine.
MISUSING THE TERM 'FREE'
When offering free goods and/or services, any qualifiers, subsequent or deferred charges, and key terms and conditions should be stated clearly and prominently.
In the case of free trials, suppliers should notify consumers before the end of the trial period and give clear information on any subsequent fees as well as the cancellation process.
Consumers who encounter unfair practices can approach Case for help. CCCS will work with relevant partners, including Case and trade associations, to reach out to suppliers.
Case president Lim Biow Chuan said the association supports the guidelines.
"Case will not hesitate to take the necessary action to refer egregious retailers who engage in persistent unfair practices to CCCS for investigation and enforcement," he added.
CCCS director for consumer protection Jack Teng said the watchdog takes a balanced approach in enforcing the rules, with mediation and negotiation being the first step, The Straits Times reported. But it will look into businesses that are persistent in their errant practices.
For Singapore Polytechnic marketing and retail lecturer Lucas Tok, the guidelines are a long time coming, especially now when consumers who are not digitally savvy are going online more because of Covid-19.
But he is worried there could be grey areas.
"What if despite listing everything fully, there are still complaints? As a merchant you are caught," he said.
"Online, it is difficult to ascertain if the consumer viewing your terms and conditions fully understand and is making an informed choice."