Netherland’s Supreme Court rulings shake up Dutch e-commerce: what you need to know

On 4 October 2024, the Dutch Supreme Court delivered two landmark rulings that have significant implications for e-commerce platforms. The rulings clarify that buttons labeled "place order," "order," or "complete order" do not meet the requirements set out in Article 6:230v of the Dutch Civil Code, which is derived from Article 8(2) of Directive 2011/83/EU on Consumer Rights. This provision mandates that consumers must explicitly acknowledge that placing an order implies an obligation to pay. 

Other key points of the rulings include the following: 

• Non-Compliant Order Buttons – buttons labeled "place order," "order," or "complete order" do not meet the legal requirement.
   
• Consumer Protection – consumers may not be bound by contracts if the order button does not clearly indicate a payment obligation.
   
• Reasonable Compensation – after annulment of a contract, consumers only need to compensate for performance already rendered to a reasonable extent.  
   
• Effective and Dissuading Penalty: traders cannot recover the full value of services without a discount, ensuring penalties are effective and dissuasive.

The 'large e-commerce platform' case

 In one case, a consumer ordered items on one of the largest e-commerce platforms in the Netherlands and completed the purchase by clicking a button labeled "place order."  The consumer chose to pay later but failed to do so. The e-commerce platform initiated legal proceedings to demand payment. The court referred prejudicial questions to the Supreme Court, which ruled that the button did not meet the legal requirement, and thus that the contract may be (partially) annulled. In cases where the consumer has appeared in court, the court may annul the contract in full if the consumer has been given the opportunity to comment on it and if the consumer does not oppose it. In cases where the consumer has not appeared in court, the court must ex officio partially annul the contract. In the event of partial annulment, the Supreme Court has provided a non-binding guideline for courts stating that a one-third discount on the consumer's payment obligation is, in principle, reasonable.

The 'course provider' case

In another case, a consumer enrolled in a course via the course provider's website by clicking a button labeled "schrijf je nu in" (sign up now). The consumer later stopped attending classes and paying tuition. The court in the first instance referred a prejudicial question to the Supreme Court, asking whether the consumer should pay for already delivered services. The Supreme Court ruled that after the contract is annulled, the consumer only needs to compensate the company for the value of services already rendered to a reasonable extent. The court emphasised that it is not reasonable for the company to recover the full value without any discount, ensuring that the penalty for non-compliance is effective and dissuasive.

Commentary and implications

These rulings have far-reaching implications for e-commerce platforms. Many platforms do not strictly follow the rule that the order button must clearly indicate a payment obligation. This oversight could give consumers the right to have contracts annulled, leading to financial consequences for traders. The rulings underscore the importance of compliance with consumer protection laws to avoid legal and financial repercussions.

E-commerce businesses must review and possibly revise their order processes to ensure that buttons clearly indicate a payment obligation. Failure to do so could result in annulled contracts and the obligation to compensate consumers for services rendered, but only to the extent deemed reasonable by the court.

For more information on these rulings and issues related to e-commerce, consumer rights and litigation in the Netherlands, contact these CMS experts.