The new Trade Law entered into force at the end of July and introduces new rules that will affect retail stores, wholesellers and traders who operate in distance trade, especially in the area of sale incentives advertising.
In addition to these novelties, the Legislator wanted to harmonize new Law with the Consumer Protection Law as well as with the Law on Electronic Commerce, so this area should now provide a greater level of compliance and legal security for both traders and consumers, without any ambiguity that existed so far.
The Law entered into force on 30 July 2019 bringing the following most important novelties:
Better definition of the sale incentives
In the previous law the sale incentives were not defined appropriately for the market needs, which resulted with numerous ambiguities in practice. The new Law paid much more attention to the sale incentives, so it finally defines main forms of reduced-price trade, followed with the special rules for each of the said.
These forms are: seasonal discount, action sale and clearance sale. According the new Law, seasonal discount may be arranged up to two times a year, provided that the start of the seasonal discount period starts between 25 December and 10 January and between 1 July and 15 July, with restriction that every seasonal discount period cannot exceed 60 days. Action sale is defined as trade of goods/service at a lower price than the previous price of such goods/service and it cannot exceed 31 days. Clearance sale of goods is defined as sale with reduced price in comparison to the previous price, which may be arranged only in case of termination of trader’s activity, termination of activities in certain sale point or termination of trade with certain goods, with additional restrictions referring to the allocation of goods on clearance sale and procurement of new quantities.
An additional important novelty related to sale incentives is more detail regulation of the sale incentives’ advertising, so it is now provided that the highest percentage of the discount that may be indicated is only the one relating to at least one fifth (1/5) of the trader’s range at each marketplace where the sale incentive is arranged.
For the first time, the types of distance trade (e-commerce) are defined, due to the importance of the new technologies.
Due to increased use of new technologies in the trade of goods and services, more attention was paid to the provisions regulating distance trade. For the first time, electronic platform and electronic store are defined, whereas the distance trade is now split to e-commerce and other distance trade. Additionally, specific forms of e-commerce are defined: webshop, electronic platform and dropshipping, which however do not restrict other innovative ways of e-commerce. Webshop is a basic form of e-commerce and represents sale of goods and/or services through an electronic store that the trader provides on his website. The electronic platform connects traders and consumers, in a way that the consumer concludes an agreement with the trader, whereas such agreement should determine the platform for ordering, paying and delivery. Specific about dropshipping is that the goods are delivered directly from the manufacturer’s warehouse to the consumer. Regardless, consumer even in that case concludes an agreement with the trader, whereas the delivery of the goods is considered as one of the deliverables of such agreement.
It is prescribed that the Law applies to the foreign entity provided that such entity is in the distance sale business targeting consumers in Serbia (i.e. if the goods are offered in Serbian or the price is indicated in Dinars or delivery to Serbia is offered).
Labeling of the goods
In addition, the new Law explicitly imposes obligation of distance trader to make mandatory labeling data directly and permanently available. Mandatory labeling of the goods with machine-readable label (GTIN identification, QR code, etc.) is also introduced, however applicable as of 31 January 2020.
Lifting the obligation of publishing the retail format
Due to the often inadequate publication of the retail format in practice, the new Law lifts the obligation of publishing retail format applicable so far, so that the traders can now freely decide whether to publish retail format. In case they decide to publish retail format, the bylaws referring to such format continue to apply.
Concealed shopping as new authorization in supervisory procedure
An important novelty in terms of inspection is “concealed shopping”. Namely, under the new Law, a trade inspector has the authority to conduct concealed purchase of goods/service, in accordance with regulations related to the supervisory procedure, in order to achieve more efficient detection of illegal trade.
Amendments of the Law on Electronic Commerce
In addition, please note that on 30 July 2019 Law on Amendments to the Law on Electronic Commerce entered into force, for the purpose of harmonizing Serbian law with the relevant Directive of the European Union. Most of the new provisions shall enter into force upon Serbia’s accession to the European Union. One of the amendments that entered into force with immediate effect is related to obligation of information society service providers to regularly check and unsubscribe recipients from the list of recipients of commercial messages.