EU Consumer Protection Research Articles

Towards Smarter Consumer Protection Rules for the Digital Society

Digital services offer new opportunities from which consumers benefit daily. However, they also raise a number of novel questions for consumer protection. Benefiting from the analysis and findings of the most recent academic literature, this Policy Report makes recommendations to improve EU consumer protection rules for digital society. One group of recommendations aims at making the horizontal consumer protection smarter. First, the best guardians of consumers’ interests are the consumers themselves. However, for many customers, the underlying functioning of digital services is difficult to understand. Improving digital literacy is therefore a key requirement, if any protection regarding digital services is to be effective. Second, the scope of consumer protection rules should be extended to all digital services independently of whether or not the consumer either pays a price (in money or quasi-currency) and/or provides personal data when getting or using the service. Third, alternative means of regulation deserve attention. Self and co-regulation are already used in some cases and can strike, under some conditions, the right balance between predictability, flexibility, efficiency, and the need to develop future-proof solutions. Fourth, insights from behavioural studies showing that the rationality of consumers is bounded should be better taken into account. In particular, this implies that disclosure obligations, which form the basis of EU consumer protection rules, should be better tailored to observed behaviours when it comes to defining what information should be disclosed, to whom, how and when. Fifth, consumer protection agencies should explore the advantages and disadvantages of personalising disclosures, an evolution which the progress of big data and artificial intelligence allow. Sixth, the consequences of the application of the open-textured legal concept of unfairness (whether of commercial practices or contract terms) in an algorithmic decision-making environment should be clarified, possibly with some soft law instruments. The consequences of the fairness obligations for traders using algorithms, in terms of transparency and beyond, should be better explored with all the stakeholders and then clarified in specific guidance. Those consequences should be assessed taking into account the probable increasing use of algorithms by consumers when making their consumption decisions. The other group of recommendations aims at making enforcement of the rules more effective. First, public enforcement needs to be strengthened and national consumer protection agencies need to be well staffed, independent from any political pressure as well as from capture by corporate interests or consumer associations, and also given power to impose sanctions with sufficient deterrent effects. When facing new issues, those agencies may rely first on soft enforcement by trying to settle those issues with the digital firms, and soft law by adopting guidelines to clarify the application of principles-based rules to those new problems. National authorities should also seize the opportunity offered by digital technologies, in particular big data and artificial intelligence, to improve their operations. Moreover, consumer protection agencies should cooperate at national level with other specialised agencies in charge of regulating specific aspects of the digital value chain (such as authorities in charge of data protection, competition policy, electronic communication or media services) to achieve better and more consistent decision-making across the value chain. In addition, national consumer protection agencies should better cooperate among themselves, and with the Commission at the EU level, to better fight pan-EU infringements of EU consumer rules, establish more consistent interpretation of rules and develop best practices. Second, private enforcement needs to be strengthened. Consumers should be made more aware of their rights and should be provided with easier means of securing damages when the infringement of their rights has caused them harm. Third, the potential of technology enforcement where rules move from the legislative code to the computer code should be better explored with all the stakeholders. As privacy by design is developing, consumer protection by design should also be explored.

How to Make the Best of Mandatory Information Requirements in Consumer Law

Abstract: EU consumer protection relies inter alia on information requirements imposing on traders the duty to provide specific and mandatory information to consumers before the conclusion of a contract. If consumers make well informed choices this can serve their individual interest, but it is also thought to contribute to a healthy market. However, the imposition of stringent and specific information requirements has been criticized from several points of view. For example, behavioural scientist have argued that more information does not necessarily lead to better decisions. From an economic point of view, information requirements can even be harmful to consumer interests. Nevertheless, information requirements form a substantive part of EU consumer protection and therefor this contribution explores how information requirements may be of added value. It is argued that information requirements can add value to consumer protection when regarded in relation to general contract law. This point is illustrated by an analyses of the information duties of the Consumer Rights Directive in relation to general contract law.

Consumer Decisions Under High Information Load: How Can Legal Rules Improve Search Behavior and Decision Quality?

EU consumer protection legislation is designed to enable consumers to make good contract decisions in the market place. This legislation heavily relies on the model of rational homo oeconomicus: It assumes that consumers want to and can process large amounts of information in order to maximize their own outcomes, and requires businesses to provide a wealth of information to their customers. In an interdisciplinary study conducted by lawyers and psychologists, we wanted to describe the precise flaws of this strategy, based on the EU consumer protection regulation presently in force, and to formulate assumptions about promising regulatory means to overcome them.We examined search behavior and decision strategies in a sample of 363 persons who we asked to choose a cellular service contract. Participants were presented with contract offers which reflected the demands of the law and which closely matched offers that can be found in the Austrian market. The multiple offers of 11 providers, with variation in rates and conditions, comprised each a large amount of detail and information. Hence, the choice situation was complex and information load was high. Two different user profiles were randomly assigned to the participants. Choice quality was measured on three levels (tariff quality, term quality, and subjective quality). We assessed the information processing behavior (including personal and contextual variables) with a palette of measures, identified discrete choice strategies, and examined how these related to choice quality. We found that most successful search strategies were not exhaustive, but instead involved the focused selection and processing of a medium amount of information. Successful decision behavior of that kind seems to be only partly and most imperfectly supported by present regulation. Research is now underway to explore a more ergonomic (i.e., psychologically realistic and effective) regulation of consumer information that may lead to a higher number ob good contract choices by cellular service customers.

EU Law Concepts as Legal Transplants: Linguistic Difficulties of Transferring EU Consumer Law Concepts into Ukrainian Legal System

This article’s purpose is to review certain EU legal concepts from a comparative law and linguistics perspective and to create guidelines for adapting these EU law concepts to the conceptual system of the member states. This article draws on comparative law studies for the theory of legal transplants and on linguistics for the methodology of terminology. After analyzing the EU legal concepts as a specific type of transplants, the article focuses on specific examples of legal transplantation from EU consumer protection law. In this process, the EU law is the source system and the Ukrainian law is the recipient. Based on the consumer protection law examples, this article identifies and explains the most common linguistic reasons for transplant failures, describes the possible legal outcome for the recipient legal system and proposes a possible solution using linguistic methods.

Forty Years of EU Consumer Protection: Where Does It Stand Now?

Forty Years of EU Consumer Protection: Where Does It Stand Now?

Reflections on the Protection of 'Vulnerable' Consumers Under EU Law

This article seeks to explore the concept of the ‘vulnerable’ consumer and to reflect on how EU law protects, or fails to protect, such consumers. Section I of the article considers the current situation with regard to the protection of ‘vulnerable’ consumers under EU law. The section first examines key EU consumer protection instruments to establish how they address the position of ‘vulnerable’ consumers, before proceeding to review relevant case law of the Court of Justice on this issue. Section II examines in more detail the concept of ‘vulnerability’ with regard to consumers, and considers the many different causes of vulnerability. This is linked to a discussion of the related concept of the ‘average’ consumers. The second part of the article reflects on how EU law could better provide protection to disadvantaged or ‘vulnerable’ consumers. The article concludes that the current ‘one size fits all’ category of ‘vulnerability’ found in EU law is inadequate to provide the protection for the many different kinds of disadvantaged consumers who can fall under the general category of ‘vulnerable’, and that more targeted measures, and a recognition of the diversity of all consumers, would provide greater levels protection.

EU Consumer Protection and the Implementation in Macedonia and Countries of Former Yugoslavia: Focus on Liability for Defective Products

EU Consumer Protection and the Implementation in Macedonia and Countries of Former Yugoslavia: Focus on Liability for Defective Products

Consumer protection and the EU Single Market rules – The search for the 'paradigm consumer'

The success of the EU Single Market depends on consumers and their willingness to purchase goods and services cross-border. In a Europe with different regulatory traditions and solutions, protecting different groups of consumers coming from different cultural backgrounds, there is no real Euro-consumer. The European Court of Justice has in its search for a 'paradigm consumer' found one: a consumer who plays a crucial role in building Europe's Single Market. The question is whether this concept of consumer is sufficient to make sure that not only consumers should be aware and alert ('caveat emptor') but also sellers ('caveat venditor'). This article explores this intriguing question by holding the concept of a paradigm consumer against the light of the Lisbon Treaty, which may have strengthened the consumer dimension of EU law. Furthermore, some of the current challenges are discussed that have an impact on consumer policy, such as the economic, food and climate change crises, or the digitalisation. Lastly the article presents some final observations on the role of EU legislation in developing EU consumer policy and providing for a more harmonious relationship between EU Single Market law and consumer protection.

Common European Sales Law

PurposeThis article seeks to take a critical look at the proposed Common European Sales Law (CESL).Design/methodology/approachThe article looks at the rationales given to support the enactment of the CESL. The approach is critical in nature seeking to vet the plausibility of the rationales given for a new regulation The article also takes a critical look at the CESL's structure and trilogy of coverage – sale of goods, supply of digital content, and supply of services.FindingsThe article exposes some of the shortcomings of the CESL and the dangers to substantive private law of crafting a regulation based on political feasibility.Research limitations/implicationsThe CESL as proposed offers some innovative ideas in areas of the bifurcation of businesses into large and small to medium‐sized enterprises (SMEs), as well as rules covering digital content and the supply of trade‐related services. In the end, the analysis suggests a more thorough review is needed to better understand the CESL's interrelationship with the Convention on Contracts for the International Sales Law (CISG) and EU consumer protection law.Practical implicationsFurther analysis is needed and unanswered questions need to be answered prior to the enactment of the CESL into law. A practical first step would to begin with a more targeted law focused on internet trading and licensing contracts.Originality/valueThis article questions the rationales given for the enactment of an ambitious new regulation covering disparate areas of sale of goods, supplying (licensing) of digital content, trade‐related services, and consumer protection. It further questions the rationality and practicality of the creation of the designation of SMEs as types of businesses in need of extra protections not currently provided by contract law's general policing doctrines.

Who Determines What Civil Courts Decide? Private Rights, Public Policy and EU Law

Over the last decades EU legislation and decisions of the Court of Justice have empowered and sometimes required the courts of Member States to address certain EU legal issues of their own motion. Where they do so in the context of civil litigation, this cuts across existing national patterns of the relative roles of the parties and of courts in determining the subject-matter of the case. The purpose of this paper is to consider how this EU law relates to established national European approaches to the relative role of the parties and the courts in determining the questions which courts address and to national conceptions of the civil process: is civil justice seen as requiring the court to apply the law to the claims brought before them, it being the role of courts to do justice by upholding the parties’ substantive rights deriving from private law? or is the fundamental purpose of the civil process the resolution of an agreed dispute, this dispute being identified and delineated by the parties through their pleadings and submissions? The paper first looks at three national law examples (English law, French law and German law) and then considers in turn the explicit rules of the EU private international legislative acquis which impose on national courts a duty to raise issues of civil jurisdiction of their own motion, the general approach of the Court of Justice to the question whether national courts must raise issues of EU law of their own motion under Van Schinjdel and the important (and apparently distinct) line of case-law of the Court of Justice following Oceano Grupo Editorial as regards the role of courts in EU consumer protection. The paper explores the difficulties facing the CJEU in determining the relative roles of national courts and parties in relation to EU law issues and explains how the CJEU has to balance the desirability of supporting the effectiveness of EU legislation against the radical effect of requiring judicial intervention not merely on national rules of civil procedure but also on national conceptions of the civil process. For this purpose, the CJEU is likely to continue to recognise very general principles of civil procedure common to the civil law of Member States, such as the principle of party initiative and its main exception in cases involving the public interest and, in doing so, brings these principles within the fold of EU law itself and develops its own European conception of the civil process.

Behavioural Economics and the Autonomous Consumer

Abstract This chapter takes as its starting point the ‘information approach’ which is the basis of current EU consumer protection legislation. It argues that the findings of behavioural economics suggest that the ‘information approach’ does not in practice achieve the protection of the consumer which it is trying to achieve. Insights and techniques gained from behavioural economics can be used as the basis for more effective consumer protection legislation, while at the same time respecting the principle of consumer autonomy which is the fundamental (though sometimes unstated) principle of EU internal market law.

Behavioural Economics and the Autonomous Consumer

AbstractThis chapter takes as its starting point the ‘information approach’ which is the basis of current EU consumer protection legislation. It argues that the findings of behavioural economics suggest that the ‘information approach’ does not in practice achieve the protection of the consumer which it is trying to achieve. Insights and techniques gained from behavioural economics can be used as the basis for more effective consumer protection legislation, while at the same time respecting the principle of consumer autonomy which is the fundamental (though sometimes unstated) principle of EU internal market law.

Evolution of consumer protection law in the light of the proposal for a horizontal directive on consumer rights and rome i regulation

The aim of this paper is to give a broad analysis of changes in the field of consumer protection law in the European Union over three decades. In 2004, the European Commission launched a project of reviewing consumer law in order to strengthen consumers’ confidence in the internal market and to encourage businesses to conduct cross-border trading. The EU consumer protection regulatory framework is based on directives including a minimum harmonization clause. This clause allows Member States to maintain or adopt stricter consumer protection rules and leads to fragmentation in their national laws. For instance, it was found that the notion and definition of a consumer has been designed for use by a specific directive, depending on which area is covered by the regulation of the personal scope. The definition of the so-called weaker party in a contractual relationship is understood in a narrow way, which is highlighted in the established line of the European Court of Justice case law. A brief outline of the history of the shaping of consumer protection policy in the European Union is presented to demonstrate how the problem of amending consumer protection law has evolved in the EU as well as increased in importance; this has been demonstrated in several programs and resolutions of the European Parliament and communications of the European Commission, which discuss the need to reform consumer contract law. The Proposal for a Horizontal Directive on Consumer Rights is the result of a review of consumer law acquis communautaire , referred to as the Consumer Acquis, and aims at introducing a full harmonization clause where feasible. Until recently, the norms governing the determination of the law applicable to consumer contracts have been defined by the Rome Convention of 1980 on the law applicable to contract relations. Due to its overly casuistic nature and outdated provisions relating to consumer contracts, it was decided to amend the Convention, which was changed into the Rome I Regulation.

Effective collective redress in antitrust and consumer protection matters: A panacea or a chimera?

Although collective redress constitutes a significant feature of modern judicial systems, EU law seems reluctant as to the introduction of such mechanisms. On the one hand, the role of collective rights of action remains indispensable in order to promote procedural efficiency and overcome rational apathy, especially in the fields of antitrust and consumer protection law where illegal business practices may cause scattered and low-valued damages to a multitude of harmed individuals. On the other hand, the potential for unmeritorious claims and abusive actions should not be underestimated, so that specific safeguards are put in place in order to avoid the emergence of a litigation industry in the form of entrepreneurial attorneys. In light of the recent public consultation launched by the EU Commission, the present paper addresses the challenges and makes propositions for the future collective redress legislation. For that reason, an in-depth analysis as to the substantive, jurisdictional and conflict-of-laws aspects of both representative and collective actions has to be undertaken. In each case, specific consideration will be given to the peculiarities of the Member States procedural traditions and the policy objectives underpinning EU competition and consumer protection law.

GMC expresses doubt over EC plans to free movement of doctors across Europe

Plans by the European Commission to simplify legislation that allows doctors to work anywhere in the European Union do not provide sufficient assurance of migrant doctors’ education, competency, or language skills, the General Medical Council has said. The United Kingdom’s medical regulator gave a stark warning about the commission’s proposals when giving evidence on 30 June to the House of Lords EU social policies and consumer protection subcommittee, as part of its inquiry into the mobility of healthcare professionals ( BMJ Careers 14 May, http://careers.bmj.com/careers/advice/view-article.html?id=20002963). Peers on the committee are holding the inquiry in response to the ongoing European Commission review of its directive on the mutual recognition of professional qualifications, which aims to have all member states recognise each other’s healthcare qualifications and simplify the movement of clinicians across countries. Giving evidence to the Lords select committee, Peter Rubin, the GMC’s chairman, said, “We support the principle of free movement of doctors in the EU, and we …

An empirical analysis of the impact of EU’s new food safety standards on china’s tea export

SummaryStricter pesticide residue standards have severe negative impacts on the trade in developing countries, leading to a considerable decrease in the export of food and agricultural products from developing countries. For example, officials of the EU Health and Consumer Protection Bureau published the new EU Act 2000/42/EC on 30 June 30, 2000. This act amended the maximum residue levels (MRLs) for some pesticides. From 1 July 1, 2001 onwards, the EU implemented new 134 MRLs for pesticides in tea products. This measure above will limit market entry opportunities and will lead to a decrease in exports from these developing countries. This study aimed to utilise the Gravity Model in international trade, to empirically analyse the impact of the new EU Food Safety Act on the major tea exporters of the world. It is shown that the new EU Food Safety Act has had a significant impact on the major tea exporters of the world as shown in the decline in export volume. Quantitative analysis indicates that tea export has reduced by 61.6% following the MRL reduction to 5% significance level. In recent years the Chinese tea traded to EU supported the accuracy of this conclusion. Practically, China’s tea exported to the EU did not drop fast as the theoretical result shows.

Is the consumer directive advantageous for the consumers?

According to the EU Consumer Protection Directive a purchaser has the right to ask for either repair or replacement of a defect product, whereas before in some member countries only one of these remedies were available. It seems to be taken for granted in the Directive and in Green Papers that such a reform is an advantage to the consumers. An analysis of a case at the Supreme Court of Norway demonstrates that the opposite might be true. It will be argued that both purchasers and vendors will be better off if the Directive is interpreted in accordance with economic theory. Harmonization of consumer protection across EU countries might be counterproductive. The analysis is of general interest in the sense that it demonstrates that mandatory changes in rights and obligations among contracting parties may have distributive effects different from what is commonly assumed.

Arbitration Clause as Unfair Contract Term from the Perspective of Czech and EC Law

The conflict between EU consumer protection provided for by the Directive on unfair terms in consumer contracts and principles of arbitration came to a head in the ECJ's Claro case. This case has shown that the arbitration clause may be an unfair contract term par excellence. I use this case as a point of departure for the considerations on unfairness of arbitration clause in contracts between businesses and consumers. Consequently, I draw a parallel between the Claro case and the lasting contractual practice in the Czech Republic where the arbitration clauses incorporated in standard form contracts between businesses and consumers are in many instances unfair. Their unfairness stems from the fact that arbitration clauses refer to arbitrators ad hoc who are unilaterally appointed and paid by businesses. Since standard form contracts are proffered by businesses, consumers are not given an opportunity to negotiate about the contract. This state of affairs in the Czech Republic is at variance with the Directive on unfair contract terms as well as the ECJ's case law which provides its interpretation.From the structural viewpoint, first I am going to briefly inform about the consumer protection provided by the Directive. Subsequently, I deal with the ECJ's cases having an importance for further considerations regarding unfair nature of arbitration clauses while putting particular emphasis on the ECJ's Claro case. Then, I aim to show that the Directive has not been correctly implemented into Czech Law. As a next step, I would like to offer a possible solution for this unsatisfactory situation in the Czech Republic with the help of comparative insight into legal orders of the Member States. Finally, the development of the view on arbitration clauses as unfair contract terms in the EU is reflected.

EU Treaty Revision and Consumer Protection

In its original version, this paper was delivered by the authors to the Bureau Europeen des Unions des Consommateurs in April 2004 in order to provide the basis for that body’s submissions to the intergovernmental conference then charged with the task agreeing a new constitutional Treaty for the European Union. The aim: to improve the attention paid to the consumer interest in the Treaty. Ultimately the text agreed by the Heads of State and government of the Member States of the EU in June 2004 largely adopted the existing consumer-related acquis communautaire – in fact in most areas of substantive EU policy-making, not merely consumer policy, textual continuity is the hallmark of the newly agreed text. This paper has been revised to provide a commentary on the consumer-related provisions that were agreed in June 2004, in order both to show chances that have been missed (but may be revived should the ratification process founder) and to reveal areas of current debate that remain topical and controversial because of the preference simply to absorb existing provisions, lightly amended or left wholly unamended, into the constitutional Treaty agreed by the Heads of State and government of the Member States of the EU in June 2004.

Europe's New Rules on GMOs

The moratorium on approval of new genetically modified organisms (GMOs) in Europe reaches its fifth anniversary this month, and with new legislation in place to regulate safety testing, labelling, and product tracing, it may soon be lifted. But is Europe ready to grow GMOs? No new GM crops have been approved in Europe since October 1998. The authorization procedure was blocked by a group of member states calling for stricter labelling and traceability legislation. On July 22, the Commission (EC) adopted a law that requires products containing more than 0.9% of GMOs to be labelled. In addition, industry is required to keep records of products that contain or are produced from GMOs, to help monitor environmental and health effects. The new laws come into force this fall. Earlier this year, a Union (EU) directive was introduced that regulates the authorization procedure for GM crops and requires strict safety testing before a new GMO can be released into the environment. European consumers can now have confidence that any GM food or feed marketed in Europe has been subject to the most rigorous pre-marketing assessment in the world, says EU Health and Consumer Protection Commissioner David Byrne (Brussels). Consumers will also have a clear