Case C-476/14, Citroën Commerce – an advertised price is not an offer [judgment 2016, ECLI:EU:C:2016:527]

A newspaper advert placed by a car company stipulated that the exclusive price of a car was €22 000. Beside the number was a footnote sign. The tiny footnoted text indicated that consumers also needed to stump up an extra €800 for mandatory delivery costs. However, the footnote failed to declare the total purchase price of the car. The legal issue is whether the advertised price constitutes an offer for the purposes of the EU’s Directive 98/6/EC on consumer protection in the indication of the prices of products offered to consumers?

Background
Citroën Commerce placed an advert in a German newspaper. The advert depicted a particular model of Citroën car.

The advert also indicated that the exclusive price of the car was to be €22 000. Furthermore, in large printed letters the advert claimed that the purchaser would save €6 000 because of all the extras which had been included in the price.

However, beside the €22 000 price was a tiny footnote number 1. Buried away in the small print was mention of the fact that the price did not include €790 in delivery costs.

Of significance for German law, the advert did not stipulate the total price which a consumer would have to pay for the car. This omission led to Citroën Commerce being sued, and losing both at first instance and on appeal.

On a subsequent appeal to the German Supreme Court, the five judges doubted what should be the correct interpretation to two pieces of EU legislation.

The first piece is the EU’s Directive 98/6/EC on consumer protection in the indication of the prices of products offered to consumers (OJ [1998] L80/27).

Article 1 states:

The purpose of this Directive is to stipulate indication of the selling price and the price per unit of measurement of products offered by traders to consumers in order to improve consumer information and to facilitate comparison of prices.

More specifically, Article 3 provides that:

1. The selling price and the unit price shall be indicated for all products referred to in Article 1, the indication of the unit price being subject to the provisions of Article 5. The unit price need not be indicated if it is identical to the sales price.

However, what was not clear to the German Supreme Court was whether an advert constitutes an offer. This issue then became its first Question to the CJEU.

The German Supreme Court then reflected further and decided to ask its second question, namely, if an advert was an offer, then did the advert have to include the obligatory cost associated with the transporting the vehicle from the manufacturer to the consumer?

For completeness, the German Supreme Court generated a third question for the CJEU. In the event that an advert was not capable of constituting an offer, then could liability still arise on the basis that the obligatory transport cost contravened the EU’s ‘Unfair Commercial Practices’ Directive 2005/29/EC concerning unfair business-to-consumer commercial practices in the internal market (OJ [2005] L149/22)?

In that context, Article 2 of the Unfair Commercial Practices Directive provides:

For the purposes of this Directive:
(i) “invitation to purchase” means a commercial communication which indicates characteristics of the product and the price in a way appropriate to the means of the commercial communication used and thereby enables the consumer to make a purchase;

Further, Article 7 governs ‘Misleading omissions’

…
4. In the case of an invitation to purchase, the following information shall be regarded as material, if not already apparent from the context:…
(c) the price inclusive of taxes, or where the nature of the product means that the price cannot reasonably be calculated in advance, the manner in which the price is calculated, as well as, where appropriate, all additional freight, delivery or postal charges or, where these charges cannot reasonably be calculated in advance, the fact that such additional charges may be payable;…

The German Supreme Court was minded to uphold and maintain German case law, and thus find Citroën Commerce liable. After all, the cost of delivering a car is an unusual cost and it should have been mentioned in the total purchase price. Furthermore, the charge was not an optional one because consumers were not free to make their own arrangements to collect the car. Nor would it have been impossible for the advert to have indicated the total purchase price – for this was not a case where the advert had indicated that the applicable transport costs were variable.

Questions Referred
According to the Curia website, the German Supreme Court has asked:

1. Does an advertisement for a product which indicates the price to be paid for it constitute an offer within the meaning of Article 1 of Directive 98/6/EC? […]

2. If the first question is to be answered in the affirmative:
In the case of an offer within the meaning of Article 1 of Directive 98/6/EC, must the selling price to be indicated in accordance with Article 1 and the first sentence of Article 3(1) also include costs necessarily incurred in connection with the transfer of a motor vehicle from the manufacturer to the dealer?

3. If the first or the second question is to be answered in the negative:
In the case of an invitation to purchase within the meaning of Article 2(i) of Directive 2005/29/EC, […] must the ‘price inclusive of taxes’ to be indicated in accordance with the provision governing the first scenario contemplated in Article 7(4)(c) of Directive 2005/29/EC also include, in the case of a motor vehicle, costs necessarily incurred in connection with the transfer of the vehicle from the manufacturer to the dealer?