French watchdog fines Boohoo €2.3m over misleading discount claims

France's directorate-general for competition, consumer affairs and fraud control has imposed a €2.3m fine on Manchester-based online fashion retailer Boohoo for misleading commercial practices. The regulator found that the company gave shoppers a false impression of how much they were saving by exaggerating the size of its discounts.

An examination of the promotions offered by Boohoo revealed that 40% were not genuine price reductions at all, 7% offered a smaller discount than advertised, and in 48% of cases the price had actually gone up rather than down. The regulator also found that Boohoo used descriptions such as "leather" or "suede" for synthetic materials, breaching French product labelling rules.

The penalty comes four years after Boohoo settled a $100m lawsuit in the United States over allegations that it used fake promotions to mislead customers. That case, filed in California, also implicated Boohoo-owned brands PrettyLittleThing and NastyGal, which were accused of running sham sales for at least four to five years. The settlement was reached without an admission of liability.

The fine lands during a difficult stretch for the retailer, which has struggled to sustain the sales growth it saw during the Covid pandemic, when physical stores were closed. Boohoo now faces stiff competition from lower-cost rivals such as Shein, Temu and secondhand marketplace Vinted, alongside rising delivery costs and tariffs in the US market. The company's reputation was also damaged in 2020 following reports of poor working conditions at Leicester factories supplying Boohoo.

Boohoo's parent, which rebranded as Debenhams Group last year and also owns Oasis, Warehouse and Karen Millen, raised £35m from shareholders in February to reduce debt. A Boohoo spokesperson said the issues identified relate to the period between October 2023 and February 2024, under the company's previous management, and have since been resolved.