A decision to waive fines handed down to three retail outlets for the use of the word “sales” outside of the official sales periods suggests an eventual end to the strict retail regulations on discounted prices
Everyone who lives in Belgium is aware of the “sales” – two months in the year when retail outlets large and small sell off remaining stock from the previous season at discounted prices. Outside of the winter (January) and summer (July) sales periods, retailers must follow a strict set of guidelines if they want to offer discounts and cannot use the word “sales” as promotion.
This legislation is in place to protect small retailers against deep discounts offered by major chains, which can afford to lose money on some merchandise. But a decision by the Council of State this week suggests that and end is coming to this system.
The Council struck down fines handed out to three clothing retail chains that used the term “sales” outside of the official winter and summer sales periods. According to the Council, the Belgian legislation does not conform to European legislation around retail.
Without this protection, independent retailers risk being driven out of the market
Mode Unie director Isolde Delanghe
While the three chains were not named, Flemish newspaper De Tijd reports that they are ZEB, Point Carré and The Fashion Store. All of them are run by The Fashion Society, a subsidiary of Colruyt.
The ruling does not put an end to the sales periods, but it does set a precedent that fines handed out to outlets for breaching the law will be overturned by the Council of State, Belgium’s supreme administrative court.
According to ZEB marketing director Erika Mees, it is a “de facto” end to the sales periods. “You can use the word ‘sales’ outside of the sales periods,” without being fined, she said. ZEB plans to launch a new sales campaign this weekend.
Mode Unie, the federation for independent fashion retailers, is far less enthusiastic about the ruling. According to Mode Unie director Isolde Delanghe, the legislation protects small and independent retailers from operating at a loss.
“Without this protection, independent retailers risk being driven out of the market, resulting in a wave of bankruptcies in the independent segment,” she told Het Nieuwsblad. “We must absolutely avoid that scenario.”
Federal department FPS Economy says it will study and analyse the rulings and the potential consequences.