Decision of the Competition Council of the Hungarian Competition Authority (GVH) Vj-183/2005: Poligrupo Hungária Fogyasztói Csoport Szervező Rt.

The Competition Council of the Hungarian Competition Authority (Gazdasági Versenyhivatal - GVH) established in its decision, issued on 23 March 2006, that Poligrupo Hungária Fogyasztói Csoport Szervező Rt. infringed the provisions on the prohibition of unfair manipulation of consumer choice of the Hungarian Competition Act.

Subject matter of the competition supervision proceeding was buyers` club (consumers` group) organizing practices. The main feature of buyers` clubs is the possibility for some of their members to obtain during the term, based on the monthly instalments of the members and owing to the financial contribution of the other members of the given group, the right of ownership of certain movable and immovable properties. Buying in buyers` clubs differs from buying with traditional payment in instalments as customers do not acquire the good after paying the first instalment. The identity of the members of a group occasionally obtaining the possibility to buy is decided by draws held by the organizer or in consequence of pre-redeem engagements. The fortune factor is an essential part of the system, not only in connection with the draws, but also with the engagement in pre-redeem actions, given the fact that members do not know and are not able to influence the willingness of others to pre-redeem. In the present competiton supervision proceedings the Competition Council of the GVH had to decide whether Poligrupo`s advertisements, published in newspapers and on the Internet, were suitable to unfairly manipulate consumer choice, thus to decide whether they violated the Hungarian Competition Act.

In the competiton supervision proceeding against Poligrupo the Competition Council of the GVH concluded that its advertisement infringed the provisions of the Hungarian Competition Act, because the words and phrases used in the laconic advertisement caused a false impression as Poligrupo would give consumer credits or credits for the purpose of real estate purchases.

The Competiton Council imposed a fine of HUF 10 million (approx. EUR 38,000) on Poligrupo for its unlawful behaviour.

Budapest, 27 March, 2006

Hungarian Competition Authority
Communication Group

Further information:
Erika Baráth
Hungarian Competition Authority
1054 Budapest, V., Alkotmány u.5.
1245 Budapest, 5. Pf. 1036
tel: (+36-1) 472-8902