European Commission publishes green paper on the review of Consumer Law

On the 8th February 2007 the European Commission published a green paper on the possible harmonisation of European consumer law, including the rules on distance selling and unfair contract terms. Existing European Union consumer protection rules are fragmented. The current directives allow the Member States to adopt more stringent rules in their national laws and only require a minimum level of harmonisation, leading to inconsistencies across the EU. In addition many issues are regulated inconsistently between directives or have been left open, resulting in regulatory ambiguity. The green paper seeks opinions on the best way to achieve a real consumer internal market striking the right balance between a high level of consumer protection and the competitiveness of enterprises, while ensuring strict respect for the principle of subsidiarity.

The green paper identifies 8 EU Directives that "set out some of the most basic rights we take for granted". In short, the basic rights are as follows:

• The Directive on Sale of Consumer Goods and Guarantees: If a product you buy does not conform to the agreement you made with the seller at the time of purchase, you can take it back and have it repaired or replaced. Alternatively, you can ask for a price reduction, or a complete refund of your money. This applies for up to two years after you take delivery of the product.
• The Unfair Contract Terms Directive: EU law says these types of unfair contract terms are prohibited. Irrespective of which EU country you sign such a contract in; EU law protects you from these sorts of abuses. Clauses for example, where you give up your right to get a deposit back, cannot be hidden in the small print at the bottom of a page.
• The Distance Selling Directive: EU law also protects you, as a consumer, when you buy from mail order, Internet or telesales companies and other "distance sellers". If you buy a product or a service from a website, mail order or telemarketing company you can cancel the contract, without giving reasons, within seven working days. For some financial services you have up to fourteen calendar days to cancel the contract.
• The Doorstep Selling Directive: EU law protects you against doorstep selling. You have a "cooling off period" in which you can reflect - as a general principle, you can cancel such a contract within seven days.
• The Directive on Injunctions: The Directive establishes a common procedure to allow a qualified body from one country to seek an injunction in another. It aims to control traders that undertake activities in one Member State, which harm the collective interests of consumers in another Member State.
• The Price Indication Directive: EU law requires supermarkets to give you the "unit price" of products - for example, how much they cost per kilo or per litre - to help make it easier for you to decide which one is best value for money. EU law also requires financial services companies to give you certain information in a standardised way.
• The Package Travel Directive: Package tour operators must offer you compensation if your holiday does not correspond to what they promised in their brochure. The Timeshare Directive: Timeshare schemes offer the right to use an apartment or villa in a holiday resort for a period of time each year. Timeshare sellers in some holiday resorts target tourists from other countries and try to pressure them into signing expensive contracts they do not fully understand. EU law protects you against this. You are entitled to have a copy of the timeshare brochure - and a translation of the contract being proposed - in your own language. If you do sign a contract, you have a ten day "cooling off period" during which you can cancel it without giving reasons.

The primary question asked by the green paper is whether the revision of EU consumer law should take a vertical approach (the individual revision of the existing directives), or a more horizontal approach (the adoption of one or more framework instruments to regulate common features, underpinned whenever necessary by vertical actions). The green paper also consults on the extent to which the legislation should be harmonised across the EU and on more specific issues, both those common to a number of directive e.g. cooling off periods and information requirements, and those more specifically concerning sales contracts.

Responses to the green paper are due by 15 May 2007 and the paper can be read in full here.