Ministry of Economy and Commerce obliges major retail outlets to adopt unit prices

April 24, 2016

In a bid to protect consumers and indorse the principle of price transparency, the Ministry of Economy and Commerce has issued a decree obliging major retail outlets to declare the unit price of goods on sale.                                
According to the new decision, retail outlets are to display unit prices on price tags, according to the nature of the product and using one of the following measurement units:
 If the item is measured by weight: the kilogram or 100 grams is used as a unitIf the item is measured by volume: the liter or 100 ml is used as a unitIf the item is measured by length: the meter is used as a unitIf the item is measured by surface area: the square meter (m2) is used as a unit
The  initiative comes within the framework of the ministry’s efforts to boost competition in the market and to protect the consumers’ right to compare between the prices of products sold in different weights and sizes. 
A study that was carried out by the Ministry revealed that retail outlets only display the prices of goods on sale without specifying the unit price, making it difficult for consumers to compare between products.
The new initiative will require retail outlets to review the form and content of price tags currently in place, to include unit prices in addition to the selling price, name of the product and size. Selling price should be displayed against a yellow background while unit price should be displayed against a white background in order to enable consumers to easily distinguish between them. All retail outlets are to adhere to this system, regardless of the methods currently adopted to display prices, either by placing price tags directly on products or visibly forward-facing on display shelves.
In order to provide greater protection for consumers and allow them to better compare between competing products, the newly introduced procedure will apply to the majority of food and non-food commodities in addition to promotional and discount campaigns unless the overall cost of the product is the same as the unit price. The new decision has exempted merchants and retail outlets from declaring unit prices in such cases, on the grounds that there would be no benefit in comparing between items if they are packed and offered for sale by considering the original unit of measurement as a basis for comparison. For instance, when cooking oil is displayed and offered for sale in bottles of one-liter capacities, there would be no benefit in writing the liter price for a second time on the price tag. It is noteworthy to mention, and that as a first step in implementation, the decision would apply to major retail outlets of 400m2 or more.
The Ministry of Economy and Commerce emphasizes that consumer awareness and the cooperation of major retail outlets will ensure the success of the initiative, enhancing competition among brands from the perspective of the consumer by facilitating price control procedures and allowing consumers to save money.
The decision has taken into account retail outlets’ need for some time to take the necessary steps to revise and replace currently approved price tags and have been granted six months to adjust their positions according to the new provisions.
The ministry urges all consumers to report any violations to its Consumer Protection and Anti-Commercial Fraud Department.
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