Consumers and businesses alike should reap the benefits of new consumer rights legislation in Europe, with years of negotiations set to conclude with the approval by the European Parliament on Thursday (23 June) of the EU's Consumer Rights Directive.
Last week (16 June), the Parliament's internal market and consumer protection (IMCO) committee backed at first reading a compromise agreement on the draft law reached on 6 June between representatives of all three EU institutions, paving the way for this week's first-reading vote in plenary.
'Win-win' situation for businesses, consumers
"Consumers and businesses will equally win. We are a big step closer to a truly common internal market in Europe," said German centre-right MEP Andreas Schwab (European People's Party), who is steering the directive through the Parliament, ahead of the vote.
Describing the directive as "a good compromise between necessary consumer rights and justified business interests," Schwab said it would serve as an example of where "more Europe" benefits shoppers and traders alike.
Brussels has been wrestling with the legislation since it was first tabled by the European Commission back in 2008 (see ‘Background').
"More safety for consumers shopping online and common rules for businesses – these are the headlines of the political agreement between the Parliament and the Council on the Consumer Rights Directive," said Schwab.
An EU-wide right for consumers to change their minds about purchase decisions within two weeks and clearer pricing rules for Internet sales were among changes made to the draft legislation by representatives of the European Parliament, the European Commission and member states in trialogue talks earlier this month.
That deal was backed unanimously by the IMCO committee with 28 votes in favour, none against and three abstentions.
Consumer groups satisfied
Consumer groups are pleased that the draft being put to vote will not water down existing legislation in force in EU countries.
"We welcome the fact that legislators have listened to Europe's consumers […] The directive most probably will not cause any significant reduction of consumer rights in EU member states," said Monique Goyens, director-general of European consumers' group BEUC.
But Goyens did express concern over some losses, for example in relation to a shorter period of withdrawal in case consumers are not informed of their rights or as regards consumers having to bear the cost of returning goods in case of withdrawal.
"This directive has taken many hours of arduous negotiation but finally we have reached an agreement that is beneficial to consumers and provides clarity to businesses," said IMCO committee chair Malcolm Harbour MEP, a member of the European Conservatives and Reformists (ECR) group.
"Both shoppers and businesses should be given every encouragement to take advantage of the single market and this directive will significantly assist them," Harbour predicted.
Back in March, an updated version of the EU's Consumer Rights Directive was approved by the Parliament, but MEPs postponed adopting a final position on the new law to buy more time to reach agreement with member states on the most controversial issues.
The deal to be approved on Thursday contains a 14-day EU-wide withdrawal period for distance and off-premises sales during which consumers may change their minds. If for any reason they regret having made the purchase, they may return it.
Should sellers fail to inform consumers of their withdrawal rights, then the period of withdrawal extends to one year.
The price paid for the good must be refunded to the consumer within 14 days of withdrawal. Moreover, all goods ordered at a distance must be delivered to the buyer within 30 days: otherwise the consumer will have the right to cancel the purchase.
Consumers must be clearly informed about the costs of returning any unwanted goods at the time of purchase so that they can choose the online retailer with the most favourable conditions.
Digital goods are exempt from the withdrawal rules.
Legislation for the digital age
The directive sets out measures to protect consumers from cost traps and contains new rules on contracts concluded electronically. It will also introduce harmonised rules on pre-contractual information to the consumer, even for on-premises contracts.
The trader is responsible for any damage or loss of the good during delivery, negotiators agreed, while the identity and address of the seller must always be clear.
Lawmakers hope that the directive will put an end to hidden charges and confusion over who consumers are actually buying from, especially when shopping online. Pre-ticked boxes on websites will be banned and traders will no longer be able to charge consumers more for paying by credit card.
"Currently, buying an item from abroad on the Internet can serve up complications or risk for the consumer, and this seed of doubt often puts people off," said Polish MEP Adam Bielan, spokesman on the IMCO committee for the ECR group.
"Many consumers still like to see and hold the products […] they are buying. Now they will have clear rights set out in law to return goods, hopefully at only a small cost," Bielan added.
Given its unanimous adoption by the committee and the deal struck between all the EU institutions, formal approval by the European Parliament is expected to proceed smoothly.
Hungarian Minister of State for Strategic Affairs Zoltán Cséfalvay last week urged the plenary to adopt the directive at first reading. "This legislation will put consumers more in control of their purchases, protect consumers from unfair practices, enhance consumer choice and increase competition," he said.
Once backed by MEPs in plenary, the final text must still be formally approved by the Council of Ministers – timetabled for July – but given that inter-institutional negotiations have already been concluded successfully, this backing should be a formality.
Once published in the Official Journal of EU law, tentatively timetabled for October, member states will have two years to implement the legislation.