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Does the Commission want to launch the New Deal for Consumers?
By Avv. Francesca Sutti and Dr. Giacomo Dalla Valentina
May 9, 2018
A few months after the adoption of Regulation (EU) 2018/302, with which the European legislator intervened on the subject of geoblocking, the Juncker Commission once again addressed consumer protection, presenting a detailed reform plan of the relevant regulations: not without a certain emphasis, recalling the well-known Rooseveltian precedent, the executive defined the reform as a “new deal for consumers”.
The proposal, consisting of a Communication from the Commission and two draft Directives, stems from a reflection strongly supported by President Juncker (to whom, for example, the decision to dedicate a specific portfolio within the Union's executive to consumer protection, entrusted to Commissioner Věra Jourová, is attributed) and culminated in May 2017 in a Fitness Check that brought to the attention of the European institutions some issues regarding consumer protection.
In particular, the Fitness Check had found a lack of effective remedies for victims of unfair commercial practices, as well as a certain difficulty of the current legislation to adapt to the technological and economic evolution of online commerce. In fact, as represented by the Commission in the “Behavioural study on transparency in online platforms” that accompanied the proposal, e-commerce is still characterized by opacity in transactions and a lack of awareness by the average consumer of their rights.
The framework of the “new deal for consumers” is represented, as mentioned, by two Directives which, if approved, will, on the one hand, reform the regulation of representative actions for the protection of the collective interests of consumers (the so-called class action) and, on the other hand, ensure better enforcement of the previous regulations in light of the modernization and digitalization of the markets.
Regarding the first aspect, the ambitious proposal put forward by the Commission would entail the repeal of the previous Directive 2009/22/EC – which regulates injunctions for the protection of consumer interests – and the simultaneous implementation of a tool, uniform among Member States and easy to apply, that allows recognized entities (such as, for example, consumer associations) to file, on a European scale, claims “in the name and on behalf of a group of consumers harmed by unlawful commercial practices.”
In this sense, the Explanatory Memorandum accompanying the draft Directive makes explicit reference to the recent Dieselgate scandal. According to the Commission, in fact, the new “European class action” would guarantee greater protection for victims of a scale and nature comparable to the Dieselgate case: this would be ensured, among other things, by providing for sanctions with greater deterrent power and effectiveness, compensatory measures of various kinds, or by imposing on Member States the obligation to implement the Directive, with speed and at low cost.
Although less “eye-catching” than the proposal regarding the class action, the Commission’s proposal also aims at a cross-cutting reform of the acquis in the field of consumer rights in light of the drastic changes the market has undergone in recent years.
In this regard, the attention of the Commission (but not only of this one: consider the growing decision-making activity of the Italian Competition and Market Authority) is focused, first of all, on online markets.
According to the European executive, first of all, the current regulations do not allow for full transparency regarding the identity of the parties with whom consumers enter into contracts online: to this end, therefore, the proposed Directive expands the range of information that – pursuant to Directive 2011/83/EU (transposed in Italy by Legislative Decree of 21 February 2014, no. 21) – must be disclosed by traders and online merchants to their users.
Furthermore, the Directive will require search engines and product comparison platforms selling third-party products to inform consumers about any sponsorships or payments that may alter the “natural” order of search results.
The Commission, then, noting the “growing economic value of personal data,” also highlights how the increasingly widespread services of cloud storage, e-mail management and social media, cannot be considered as completely free, even, clearly, when the service is offered free of charge by them.
Compliance with the new regulations will certainly be considered burdensome by businesses. The Commission, aware of this, has therefore introduced a series of provisions aimed at at least relieving businesses from some obligations to which they are currently subject under the existing legislation.
These are some obligations considered disproportionate to the protective purposes pursued by consumer protection regulations. In particular, businesses would be relieved from the obligation to accept the consumer's withdrawal within 14 days even when the consumer has used the purchased good, rather than just trying it out.
Furthermore, the obligation to reimburse the consumer before the goods are returned to the seller will be removed. For the same purpose, it will also be possible for the merchant to use, for the communication of their information, tools other than email, such as online forms and chat.
In conclusion, if it may seem premature to speak in terms of a “new deal,” it cannot be denied that the regulatory framework proposed by the Commission is indeed broad in scope and, at least in its premises, responsive to the changing times and the needs of consumers, but extremely burdensome for businesses trading online.
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