For years, the headline discount was one of the most flexible tools in retail. A product could be listed at a higher price for a short spell, then marked down with a bold red percentage that made the offer look more generous than it really was. Shoppers grew used to it, and so did retailers.
That flexibility has been steadily removed across the European Union. A combination of new rules, a landmark court ruling and more coordinated enforcement means that the way discounts are calculated and displayed is now under far closer scrutiny. With Black Friday and the festive season driving the heaviest promotional period of the year, retailers selling into EU markets need to understand exactly what has changed and what regulators now expect.
The Rule at the Centre of It All
The turning point was the Omnibus Directive, which amended the EU’s Price Indication Directive and took effect across member states in May 2022. Its most significant change for retailers was a new requirement, set out in Article 6a: whenever a business announces a price reduction, it must show the prior price, and that prior price must be the lowest price applied during a period of at least 30 days before the reduction.
In practice, this closes one of the most common loopholes in discount marketing. A retailer can no longer briefly raise a price ahead of a sale and then present the return to the normal price as a markdown. If a product sold at €80 three weeks ago, rose to €100 last week and is now being offered at €80, there is no genuine reduction to advertise, because the lowest price in the previous 30 days was already €80.
Member states have some limited room to adapt the rule. Some allow different treatment for perishable goods, for products on the market for less than 30 days, or for progressive reductions during a single sales campaign. But the core principle is the same everywhere: the reference price must reflect what customers could actually have paid.
The Court Ruling That Removed the Ambiguity
When the rule first came in, some retailers interpreted it narrowly. They displayed the lowest 30-day price somewhere on the label, as required, but calculated their headline percentage against a different, higher figure such as the price immediately before the sale.
That approach was tested in Germany and referred to the Court of Justice of the European Union. In its 2024 judgment in the Aldi Süd case, the court made clear that any announced reduction, whether shown as a percentage or as a statement such as “price highlight”, must be based on the lowest price of the previous 30 days. Displaying the correct reference price is not enough if the advertised discount is calculated from something else.
The ruling matters because it applies across the whole EU. Any retailer still calculating a discount against the most recent price, rather than the 30-day low, is now clearly out of line with the law.
Why Enforcement Is Getting Sharper
Rules on paper only change behaviour when they are enforced, and enforcement has become more coordinated. Consumer protection authorities across the EU work together through the Consumer Protection Cooperation network, which carries out regular sweeps of websites to check how prices, discounts and urgency claims are presented. Seasonal events such as Black Friday are a natural focus for this activity.
The Omnibus Directive also strengthened penalties. For widespread infringements affecting consumers in several member states, the maximum fine available to national authorities must be at least 4% of a trader’s annual turnover in the member states concerned. For a large multi-market retailer, that is a material financial risk, before even considering the reputational damage of being named in an enforcement action.
At the same time, the European Commission has been examining wider concerns about digital marketing, including fake countdown timers, misleading scarcity messages and personalised pricing. Its work on a future Digital Fairness Act signals that the direction of travel is towards tighter rules, not looser ones.
What This Means for UK Retailers
UK businesses are no longer bound by EU directives at home, but many still sell into EU markets through their own websites, marketplaces or physical stores. Any promotion shown to consumers in an EU member state must comply with that country’s implementation of the rules.
The UK has also been moving in a similar direction. The Digital Markets, Competition and Consumers Act 2024 gave the Competition and Markets Authority powers to enforce consumer law directly and to issue significant fines, and misleading reference pricing has long been treated as an unfair commercial practice. For retailers operating in both markets, building promotional processes around the stricter EU standard is often the simplest way to stay compliant everywhere.
The Practical Challenge: Knowing Your Own Price History
The difficulty for many retailers is not understanding the rule. It is applying it consistently across thousands of products, multiple channels and constantly changing prices. To show a compliant discount, a business needs an accurate record of every price a product has carried over the previous 30 days, in every market where it is sold.
That is harder than it sounds. Prices change through planned promotions, reactive markdowns, dynamic pricing tools and channel-specific offers. Manual spreadsheets and disconnected systems make it easy for a reference price to be wrong, especially during busy trading periods when promotions are set up quickly.
Retailers that handle this well tend to have three things in place. First, a reliable price history for every product and channel, so the 30-day low can be calculated automatically rather than looked up by hand. Second, clear sign-off rules, so that no promotional claim goes live until the reference price has been checked. Third, visibility of how competitors are pricing and promoting, so that offers are designed to be genuinely competitive rather than simply looking competitive.
Rethinking Promotional Strategy
The new rules also encourage a healthier approach to promotional pricing more generally. When a discount has to be measured against a real, recent price, inflated “was” prices lose their power. What remains is the actual value of the offer, and customers are increasingly able to judge that for themselves through price comparison tools and browser extensions that track price history.
This pushes retailers towards fewer, more meaningful promotions, supported by an understanding of how price changes affect sales volume and margin. It also places more weight on market intelligence. Knowing what competitors are charging, how deep their discounts run and how often they promote helps retailers decide when a promotion is worth running at all, and how deep it needs to be to make a difference.
Getting Ready for Peak Trading
For retailers preparing for the busiest weeks of the year, a few checks are worth carrying out before any promotion goes live:
- Confirm that every advertised reduction is calculated against the lowest price of the previous 30 days in that market.
- Review how price history is stored, and whether it covers every channel where the product is sold.
- Check that urgency messages, such as countdown timers and low stock alerts, are accurate.
- Make sure the teams who set up promotions understand the rules, not just the legal or compliance function.
The EU’s crackdown on promotional discounts is not designed to stop retailers from running sales. It is designed to make sure that the savings shoppers see are real. For retailers with accurate data and disciplined processes, that is less a threat than an opportunity to win trust in a market where customers have learned to be sceptical of the red sticker.
