The regulation of market communication and market behaviour: Corporate social responsibility and the Directives on Unfair Commercial Practices and Unfair Contract Terms

Abstract

Despite the frequent insistence in EU policies on corporate social responsibility (CSR) being voluntary, this paper argues that under EU consumer law CSR can be interpreted as legally binding. CSR is a strategic form of market communication as well as an inherent aspect of the market behaviour of companies. Since EU consumer law regulates the market communication and the market behaviour of traders, this area of law can be used to interpret CSR as a legally binding obligation, resulting in remedies available to consumers. This paper uses the Unfair Commercial Practices Directive (UCPD) to show how the ECJ could, in a suitable case, consider the breach of a CSR policy either as a form of misleading market communication or as unfair trading behaviour. This interpretation would allow for the additional regulation of CSR by the UCTD, which overlaps with the UCPD in terms of scope, interpretation and remedies. Once CSR is subject to EU market regulation laws, it can result additionally in contract regulation through EU consumer sales law.