SME Chamber

Stop the scam:Combating Misleading Business Directories

 Last week GRTU Director General Vincent Farrugia was invited to actively participate during a press conference addressing the issue of combating misleading business directories, hosted by the European Parliament Office in Malta.

Many enterprises, often small traders, fall victim to scams operated through misleading advertising. A common scam is that whereby victims unwillingly sign up to an insertion into a business directory after having been led to believe that this would be free of charge.

Following this they receive a letter thanking them for placing an order for an advert, which will be placed on the business directory for 3 years and will cost them approximately €1000 a year. Presently the main company operating such a scheme in Malta is the European City Guide. 

The European Parliament has received more than 400 petitions from small businesses across the European Union and even from some third countries, who claim to have fallen victims of this scheme.

For this reason the European Parliament has appointed MEP Simon Busuttil as a rapporteur on this issue to prepare a report so that this would be adopted as the position of the institution.

Dr Busuttil explained that this initiative is not against business directories but against the misleading way in which some get clients. He continued by saying that the intentions must be set out clear at all times.

The report which Dr Busuttil is preparing has several important objectives to GRTU's members. First of all it aims to raise an awareness so that who is not a victim already does not become. It also seeks to analyse first of all whether European Law can be of assistance and secondly how it is being respected.

Dr Busuttil further explained that the team will be looking for a loop whole in  the legislation. If a grey area is identified it will be emended. Dr Busuttil seemed positive that this will be the case, since such a problem was created.

The European Parliament will be contacting the victims to inform them that the problem is being tackled and their interests are being safeguarded.

It was explained that there are laws on the subject, however the interests are sometimes not equally safeguarded. This places certain individuals at an advantage over others. What is usually the case with such scheme is that the company selling the business directory would target companies outside its country, this is fully lawful according to European law and they are fully protected. There is however not the same level of protection for the companies who are the clients of a company in another Member State.

Dr Busuttil already met with the  Commissioner for Consumers Meglena Kuneva, and numerous victims locally and throughout the EU. The next step is the public hearing which will take place in Brussels this week.

For the hearing, to which GRTU was cordially invited, all stakeholders will be present, starting from the victims, 1400 of which will be present, the representative of the European City Guide, UEAPME, the organisation representing GRTU at European level, and the Association of business directories.

The European City Guide has been in operation at least from 15 to 20 years. Its operations have escalated in 2000 with the use of the internet.

Dr Busuttil explained that a draft report will be issued and it wile be open for comments. The hope is that it is adopted in the Petitions Committee. A section on his website has already been dedicated to the subject.

GRTU Director General, Vincent Farrugia, thanked Dr Busuttil for the important initiative. As the representative of small businesses GRTU is very satisfied of the initiative primarily because it is small enterprises that are caught in the net of these scams.

Mr Farrugia has also however expressed his disappointment in the authorities. He stated that had it been a business abusing from a consumer intervention would have been immediate, however because it is a business abusing of another business there seems to be no authority to take action and nowhere to go to ask for help.   

He continued by saying that GRTU feels the Commission was too slow in its action and too many businesses not to mention the numerous NGOs who have already fallen victims.

The number of victims in Malta is to the GRTU quite alarming. 1,343 names are presently listed and amongst them would pay the amount of €4 m.

It is important for the members that have fallen victim of this scam not to give in the intimidations saying that they will take you to court. A solution will be found and no money is to be paid till now.

Regular updates will follow this issue. For further information please contact Abigail Mamo at our offices or on

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