New deal for consumers - a BusinessEurope comment paper

Key messages

• Effective consumer protection is a key enabler of online trust and a key pillar for the completion of Europe’s Digital Single Market.
• The New Deal for Consumers from April 2018 suggests significant changes to the existing and well-established European Consumer Acquis. These proposals were preceded by the 2017 Consumer and Marketing Law REFIT report and the 2017 Consumer Rights Directive evaluation report confirming that the EU Consumer and Marketing Acquis is generally fit for purpose
• Studies also show that trader compliance has increased, there is more awareness among consumers of their rights and consumer trust is at a 16-year high.
• Therefore, BusinessEurope has significant concerns about:
  • A shift from full harmonisation to minimum harmonisation which is contrary to the Single Market Strategy to bring down stifling legal fragmentation;
  • A shift from public enforcement to private enforcement with the proposal on collective representative actions (BusinessEurope has prepared a separate paper on this proposal);
  • The limited focus on existing instruments such as alternative dispute resolution and the role of European Consumer Centres (not mentioned in the New Deal proposals nor umbrella Communication);
  • A new, doubtful layer of legislation to be imposed on traders in areas not up until now regulated at EU level.
• Before amending the current rules, BusinessEurope believes that it is vital to achieve a coherent interpretation, implementation and enforcement of those rules and a good understanding of how they apply to new market realities and players.
• BusinessEurope supports the use of guidance/interpretation guidelines as tools to reach a more uniform interpretation of EU law. These guidelines can be developed either by the European Commission (e.g. Guidance on the Consumer Rights Directive or on the Unfair Commercial Practices Directive) or by multi-stakeholder dialogue groups (e.g. Principles on comparison tools and Compliance criteria on environmental claims).
• We also believe it is crucial to continue to work on awareness of existing rules amongst traders and consumers. One of the conclusions of the Consumer REFIT report is that both traders and consumers (despite clear improvements) often struggle to find the relevant information or to understand the rules and their impact on their rights and obligations. BusinessEurope is strongly engaged in the Consumer and Marketing Law REFIT Consultation Group which is working on different initiatives to improve the communication of information by traders. BusinessEurope also welcomes projects such as the Consumer Law Ready specifically orientated towards small companies.
• Any legislative amendments should be done in a targeted way. They should be limited to those provisions that represent substantial barriers to the functioning of the internal market and full harmonisation should be the method used. Any other approach would not be consistent with the objective of fighting legal fragmentation.
• BusinessEurope supports a revision which brings balance and simplifies the legal framework, making it up to date with new technological development and different business models.

Relevant facts

• Overall consumer trust in the Eurozone is at a 16-year high
• Consumers know their rights better, which helps them make more informed purchasing decisions
• More consumers are buying from a seller in another Member State
• There are fewer consumer complaints and they are better handled
• Compliance with consumer legislation has increased
• EU consumer and marketing law broadly is still fit for purpose

Sources: 2017 Consumer Conditions Scoreboard; 2017 report on Consumer and Marketing Law Fitness Check