Spanish company shut down after stinging Irish firms: ThePost.ie


TCH Archives > Sunday Business Post > 2003/09/28 > Spanish company shut down after stinging Irish firms

Spanish company shut down after stinging Irish firms
Sunday, September 28, 2003

By Kieron Wood

A Spanish company that misled Irish businesses into paying for adverts in its directory has been fined and shut down by a Catalonian court.

European City Guide, based in Barcelona, was fined €300,000 for false advertising and ordered to close for one year. Over the past four years, the Catalan authorities have received more than 3,500 complaints from all over Europe.

European C ity G u ide (ECG) sent out mailshots giving the impression that directory entries were free. However, the small print on the invoices required businesses which signed and returned the form - even if simply correcting or adding details - to pay up to €2,100 for three entries.

The Advertising Standards Authority for Ireland upheld the first complaints against ECG in February 1999. The Catalan Department of Industry, Commerce and Tourism opened a disciplinary file in January 2000. ECG was ordered to cancel contracts with all companies which had made an official complaint to the Department and to stop sending out misleading advertising orders.

In March 2001, ECG was found guilty of infringing Spanishlaws onmisleading advertising and fined €23,000, which was upheld on appeal. In October 2002, more complaints were generated by a BBC Watchdog programme report on the company.

More than 220 Irish businesses complained to the Europ ean Consumer C e ntre (ECC) in Dublin that they had been misled.

Among the Irish firms that took space in the directory were 3M Ireland, AIB Bank, Aontas, Boots, Hamilton Osborne King, Compustore, Diep Le Shaker restaurant, Ireland Online, the Museum of Modern Art, O'Brien's Sandwich Bars, Parthus Technologies, the Pharmaceutical Society of Ireland, St Vincent's Hospital, the Boilerhouse gay sauna and Soho Books sex shop.

ECC administrator Lindis L enox-Conyngham said: "Some people paid up to €1,400 for entries in these directories.

"The saddest cases involved secretaries who had been taken in and were too embarrassed to tell their bosses so they paid the invoices out of their own salaries. One man even transferred his company into his wife's name, because he was so worried about being sued by ECG.

"Companies were receiving letters from ECG's legal department and telephone calls from a Swiss debt collection company called OVAG. They threatened to take people to the Small Claims Court - but firms can't take individuals to the Small Claims Court.

"I had a fairly heated conversation with a representative of OVAG, pointing out that these contracts were unenforceable and we were advising people not to pay them.

"We would still advise businesses involved in a dispute with the European City Guide to make a formal complaint (with all relevant correspondence) to the Generalitat de Catalunya Department d'Industria,Comerc I Turisme, Direccio General de Cunsum I Seguretat Industrial at Avenida Diagonal, 405 bis, 08008 Barcelona, Spain."