Unfair Business Practices: What They Are and How to Avoid Them

When Are Business Practices Considered Unfair?

Business practices include actions and communication related to offering products and services. If such behavior disrupts or endangers the consumer’s position, it is considered unfair.

To classify conduct as an unfair business practice, two criteria must be met:

• it goes against the standards of professional diligence — meaning it's not what a customer would reasonably expect from a professional seller,
• it influences the consumer’s decision in a way that, without such behavior, they likely would have chosen differently and not made the purchase.
  
  

So if you don’t act as professionally as the customer expects, and your inaccurate or incomplete information leads them to buy something they otherwise wouldn’t have, you’re engaging in unfair business practices.

If you specifically target vulnerable groups — such as children, seniors, or people with illnesses — the practice is judged even more strictly.

Deceptive and Aggressive Business Practices

The Consumer Protection Act clearly defines which practices are considered unfair, and distinguishes between two main types:

• deceptive business practices, where the seller provides false information about products or services, or presents true information in a misleading context — or withholds important facts that could mislead the customer,
• aggressive business practices, where the seller pressures or harasses the customer, applies undue influence, or takes advantage of the customer’s difficult situation to make a sale — thus limiting their ability to make a free decision.
  
  

The law also includes a so-called “blacklist” of unfair practices, meaning actions that are always considered unfair and do not need further review. We recommend going through the law to make sure you’re not using any of the prohibited practices.

Examples of Unfair Business Practices

Unfair business practices include activities such as:

• convincing customers that your products have features they actually don’t (which they only find out after signing the contract and paying),
• using so-called “bundled offers,” where you force customers to buy additional accessories by claiming they’re essential — even though they aren’t,
• urging the client to make a purchase by claiming the product is available only now or for a limited time, preventing them from making a calm, informed decision,
• sending goods or granting access to a service without the customer ordering it — and then demanding payment,
• not giving the client enough time to read and understand the contract.
  
  

A practical example of an unfair practice:

A group of people returns from a long bus trip, and a salesperson invites them into a restaurant where they are offered free food and drinks. During the meal, the salesperson presents accurate information about a financial product — but the consumers don’t pay full attention because they’re eating. After lunch, the salesperson briefly summarizes the offer, presents the product, and hands out contracts to sign.

Unfair Business Practices Among E-Shops

Unfair practices are quite common in e-commerce. Often, it's not intentional — many online shop owners simply aren’t aware of all their legal obligations. For instance, in 2021, the Czech Trade Inspection Authority (ČOI) found legal violations in half of the e-shops it inspected.

The most frequent issues include failure to inform customers about the body responsible for out-of-court dispute resolution or about their rights concerning product returns.However, some e-shops also engage in deliberate unfair practices, such as:

• providing false or incomplete product information,
• displaying fake discounts,
• or posting fabricated customer reviews.

How to Avoid Unfair Business Practices

Customers have the right to take legal action — for instance, to claim compensation or request a refund. On top of that, a business can be fined up to CZK 5 million.

As a salesperson, the way to steer clear of unfair practices is simple: don’t use them. Make sure that everything you do complies with the Consumer Protection Act. Instead of relying on shady tactics, practice ethical sales techniques that are not only legal but will genuinely help you succeed in meetings with clients.