Regulation of promotions in Nicaragua

Jul 5, 2021 | English Blog

In order to generate sales, the promotions are one of the strategies commonly used by companies dedicated to the sale of goods and services, so we consider important to use these article to guide you of what should be taken into account when publishing a promotion.

The first thing to keep in mind is that according to Law No. 842, Law for the Protection of Consumers and Users Rights, in order to be considered as a promotion the sale of goods or services, it must have a exceptional and temporary character that allows it to be differentiated from the usual supply of goods and services.

In accordance with Executive Decree No. 36-2013, Regulation of Law No. 842, Law for the Protection of Consumers and Users Rights, the forms of promotion, among others, are the following:

  1. To additionally provide another good or service at a lower price than usual in the trade or in the same establishment; or for free,
  2. Offer goods with additional content to that of the usual presentation of the product, free of charge or at a lower price than usual,
  3. Offer two or more goods or services for the same price,
  4. Offer goods or services with the incentive to participate in sweepstakes, raffles, contests and others of the same nature,
  5. Encourage the consumer by means of figures or legends printed on the boxes or containers of the products or included within them, other than those they usually must carry; whether or not they are collectible.

It is important to note that when planning the promotion it is necessary to be clear about the terms of the same, duration, number of goods or services offered, the characteristics of both, the time to claim the prizes, as the case may be, since this information or other relevant information must be made known to consumers. Likewise, it must be clearly established when there are restrictions on sales promotions.

Also, it is necessary to take into consideration that in the event that the promotion is carried out remotely, outside the establishment or requires regulation, the consumer must be informed of the name and address of the natural or legal person that carries out the promotion, as well as the physical places in where it will be done.

On the other hand, it must be taken into account that in the event that the promotion involves raffles, contests, exchanges or any other modality that necessarily requires regulation, it must be published by any means of communication accessible to the consumer, clearly indicating the terms of it. When the raffle, contest, exchange, etc., is to be carried out, it must be carried out in the presence of a lawyer and public notary, who will attest to the results, and must be sent, with their corresponding documentary endorsements, to the General Directorate Protection of the Rights of Consumers and Users (hereinafter DIPRODEC), as well as it is mandatory to disseminate the results of its promotion after it is carried out, in any written medium of national circulation.

On the other hand, if it is necessary to modify the terms, conditions or prizes within the framework of the announced promotion, due to unforeseeable circumstances, force majeure or other duly justified cause, this change must be notified to DIPRODEC by means of a written communication requesting the authorization of said change. The DIPRODEC must rule on the matter within a maximum period of three (3) business days. Likewise, consumers must be informed immediately and by the same means of dissemination of the announced promotion, about the modification of the terms, conditions or prizes of the promotion. Please note that in no case should the changes made to the Promotion Regulations be made to the detriment of consumers or users.

It is important to mention that the General Directorate for the Protection of the Rights of Consumers and Users (DIPRODEC), can at any time verify through on-site inspections, on the inventory of the minimum quantity of available units of goods offered and the veracity of the offer, of which whoever is offering the promotion cannot refuse to provide the necessary information. In the event that the DIPRODEC determines that the interests of consumers or users were violated, it may order the prohibition of the development of the promotional offer.

Based on the foregoing, we recommend that whenever a promotion is planned, whether or not it is necessary to carry out a regulation, verify with your lawyer that the terms in order to comply with the Law and avoid possible fines for non-compliance with the Law.