General
The following obligations are in addition to those which apply generally to distance sales under the E-Commerce Directive and other legislation. They are the subject of a separate chapter.
The Consumer Rights Directive was implemented in the UK through the Consumer Contracts (Information Cancellation and Additional Payments) Regulations 2013.
The regulations provide for information to be furnished to consumers in all types of contracts including distance on-premises and off-premises contracts and a right to withdraw from distance and off premises contracts
A consumer is an individual acting for purposes only or mainly outside his trade, business or profession. Accordingly, a person may be treated as a consumer where the trade purposes are limited and are not predominant.
A distance contract is a contract concluded between a trader and consumer under an organised distance sales or service provision scheme without the simultaneous presence of the trader and consumer, through the exclusive use of one or more means of distance communications up to the time at which the contract is concluded.
Prior Information
The provision of information is a key aspect of consumer protection. The information made available to consumers must be sufficiently clear and reliable so that they can make effective choices. There is a range of disclosure obligations. The required information is intended to make consumers aware of the property of the goods. In some cases, warnings are required.
Before concluding a contract, traders must provide to consumers, in clear, understandable language, information, such as:
- their identity and contact details,
- the product’s main characteristics, and
- the conditions that apply, including payment terms, delivery time, performance and duration of the contract and termination conditions.
Information requirements, particularly on the right of withdrawal, are more detailed for postal, telephone or online contracts and off-premises purchases (where a trader visits a consumer’s home). Before entering an off premises contract, the consumer must receive clear and comprehensive information about the service or goods and the right to withdraw.
This applies to contracts over the internet but also telephone, e-mail, and other remote communication. It covers doorstep sales and sales made generally other than at the trader’s a fixed place of business. The rules do not apply to financial services package holidays and contracts relating to immovable property, for which there are separate rules.
There are partial exemptions for goods intended for consumption in the household supplied by regular agreement and contracts relating to tourism and transport.
Information Required
Prior to the conclusion of an off premises contracts, the consumer must be provided with clear and comprehensible information concerning
- identity and address of the supplier
- characteristics of goods and services and their price
- arrangements for payments delivery or performance
- the existence of a right to withdraw
- the period in which the offer remains valid and minimum duration of the contract were applicable
- cost of using the means of distance communication
In the case of telephone calls, the identity and commercial purpose must be made clear at the beginning of the transaction. Information must be given in good faith.
The consumers must receive written confirmation in a durable medium (e.g. a pdf e-mail attachment at the time of performance of the contract. The following information must be given in writing as well
- arrangements for exercising rights of withdrawal
- a place to which complaints may be addressed
- information regarding after-sale service
- conditions under which contracts may be terminated
In the case of a distance contract it must be provided in a form appropriate to the distance communication. In every case the information has to be in plain and intelligible language and where written, must be legible. In the case of a distance contract the following is also required
- costs of using means of distance communication
- where there is a right of withdrawal, the conditions time limit and procedure and a model form of withdrawal
- details of the cost of returning goods after withdrawal where relevant
- any liability to pay reasonable costs of the trader upon withdrawal
- an explanation if there is no right of withdrawal by the consumer or where the consumer may lose the right in certain circumstances
- the existence of codes of conduct
- any applicable minimum duration, for consumers obligations applicable
- existence and conditions of payments and financial guarantees to be paid provided by the consumer
- where applicable, existence of alternative dispute resolution
Right to Cancel Off Premises Contracts
Contracts entered between traders and customers away from the place of business may be cancelled within a certain period by the consumer.
Consumers can withdraw from distance and off-premises contracts within 14 days of the goods’ delivery or conclusion of the service contract, subject to certain exceptions, without any explanation or cost. A standard withdrawal form provided by the seller suffices. If the consumer is not made aware of their rights, the withdrawal period is extended by 12 months.
The supplier must repay the amounts paid by the customer within 30 days. There are certain types of contract to which the right of withdrawal does not apply. Credit agreements concluded with the supplier or a third-party on the basis of the agreement may also be cancelled
Exemptions apply for rapidly perishable goods, sealed goods opened by the consumer which cannot be returned for health or hygiene reasons, and hotel reservations or car rentals which are tied to specific dates.
The regulations provide a model form of withdrawal notice. The consumer may use that form or give other unequivocal indication of his decision to withdraw. The withdrawal terminates the obligations of the parties to perform the contract. It cancels ancillary contracts.
If the contract is terminated, the consumer is required to hand or deliver back the goods without undue delay and in any event within 14 days. He is liable for the direct costs of returning the goods if this was provided for in the initial contract with the advance information.
If the goods have been reduced in value due to the consumer’s handling (other than to the extent necessary to establish the nature characteristics and functioning of the goods), the consumer is liable for the sum. This is unless the trader failed to give the required notice of the right of withdrawal.
Consumer Rights to Performance
The supplier must generally perform when due or in any event within 30 days. If it fails to do so the consumer may call on him to perform and give additional time. If he does not perform the sums paid must be refunded and he contract may be termination.
No unjustified payment costs or additional charges may be applied. Traders must not charge consumers fees that are more than the cost to the trader of the type of payment involved.
When phoning a trader to enquire or complain about a contract, the consumer must not pay more than the basic telephone rate.
Traders must have a consumer’s express consent when offering additional paid-for services. Pre-ticked boxes on an order form may not be used for such payments
Inertia selling is prohibited. Inertia selling is the supply of goods and services to consumers beforehand where such supply involves the demand for payment. If unsolicited goods are supplied, then the consumer’s failure to comply does not constitute consent.The absence of response does not constitute consent.
The use by suppliers of automated call devices requires prior consent of the consumer. Other distance communication may be objected to.
There must be provision for appeal before the courts or administrative bodies in the events of dispute. Member states may adopt more stringent provisions.
A consumer has a right to cancel payment if a fraudulent use has been made of his payment card in connection with a distance contract or where a fraudulent use has been made to re-credit the sums concerned.
Exceptions
The directive does not apply to
- financial services
- gambling
- healthcare
- sale of real property
- timeshare
- package travel
The above rights to prior information, written confirmation withdrawal and requirements regarding performance do not apply to the contracts for the sale of foods, beers and goods intended for everyday consumption supplied to the home of the consumer, to his residence or workplace.
The right to withdraw is lost if the customer requests the service to be performed during the withdrawal period and it is fully performed within the time, if he acknowledges that he will lose that right.
The rights of withdrawal do not apply where goods are supplied to the consumer specification or are clearly personalised. It does not apply to goods that are liable to deteriorate or expire rapidly and which are not suitable for return for reasons of health and hygiene.
If the consumer exercises the right to withdraw having already agreed to the partial performance of the service, he may have to pay for the service rendered. If the service has been rendered in its entirety prior to the withdrawal, the right can no longer be exercised.
In the case of a standard utilities contract which commences during the withdrawal period at the consumer’s request, the consumer is liable for a charge for the services to a certain extent.
Consumers must be informed in advance of the price to be paid and the basis upon which it is calculated.
The right does not apply to products or services whose rates fluctuate in the market.
Distance Finance Contracts
There is a separate directive dealing with distance contracts providing financial services. This covers banking, insurance, payments and investment services. It applies when they are negotiated at a distance whether over the Internet, fax, telephone et cetera, where the parties are not simultaneously physically present.
The consumer has a right to withdraw within 14 days in the following cases
- when the contract has been signed before the consumer has received prior notice of the terms and conditions
- when the consumer has received the contractual terms and conditions but has been fairly induced to conclude the contract during the reflection period.
The period is 30 days in the case of life insurance and personal pension products
In the event of fraudulent use of a credit card, the consumer may request cancellation of the payment and reimbursement of the amount paid. There must be effective complaints procedures and provision for redress.
