German law reform sees end to ban on promotions

The German cabinet has given the green light to a new law that could see restrictions on retailer's promotional sales in the country scrapped.

German law states that retailers must restrict sales promotions to two periods of the year in late summer and the end of the winter season.

Last year, European retailer C&A was fined EUR 400,000 (£286,336) after it was found guilty of flouting the laws. The move by the cabinet follows heavy criticism of the C&A decision. Under the draft law approved last Wednesday retailers will have freedom to decide when to cut prices, which means that C&A would have escaped the fine.

A spokesman for German retail giant Metro said: 'We are in favour of being able to make our own decision when to have a sale and when not to.' He said laws were restrictive and the rigid rules had previously led to the Sale period clashing with the traditional German holiday period.

German retailers association HDE has agreed that it is in favour of the relaxation of the laws.

However, it said it was still in favour of some restrictions, since competition in Germany was already fiercer than many other European countries.

Government minister Brigitte Zypries said the new law was an important step towards greater competition and was in line with the Government's 'consumer friendly' policy.

The draft policy follows from changes to Saturday shopping laws earlier this year that will see retailers in Germany extend their opening hours on Saturday.