Friday, 21 December 2012

All the best for 2013, dear readers!

Dear readers,

Our blog and its publicity has grown in the past year and we are very happy because of that. We wish you now a Merry Christmas and even more interest in European consumer law next year! Follow us and with us join in the discussion of current consumer law issues.

Best wishes!
Joasia, Chantal, Candida, Bram

Driving home for Christmas?

We wrote here before about the plan of the European Commission to increase road safety for European citizens  by widening its scope (to motorcycles etc.) and toughening up the current testing regime (Better safe than sorry...). Unfortunately, yesterday the EU transport ministers agreed to weaken key elements of the Commission's proposal, effectively decreasing its relevance.

"The agreement by ministers today would substantially weaken the proposed new rules, by (a) removing motorcycles and other two-wheelers, the most vulnerable group of road users from the scope of mandatory regular testing; (b) removing proposals for increased frequency of technical checks for older vehicles – the highest risk vehicles on the road; (c) weakening proposed measures to reduce mileage manipulation. 

Ministers have backed measures with regard to two things: strengthened cross-border mutual recognition, and higher quality and harmonisation of testing, with minimum requirements on training, on equipment, on assessing deficiencies, on technical vehicle information and on supervision of testing."

The proposal will now be considered by the European Parliament.

Travelling for the sick

Travelling while sick is never pleasant, nor is it easy to take some medicines with you - taking into account, for example, airport restrictions. Yesterday, the European Commission adopted also pan-EU rules defining the minimum list of elements that need to be included in a medical prescription taken by a patient travelling from one Member State to another. These new EU provisions would enable cross-border identification of the patient, the prescriber and the prescribed product, diminishing delays, interruptions in treatment and extra costs. The plan is for the Member States to implement these rules by 25 October 2013. Currently, it is believed that over half of patients would have problems with their prescription being recognised in another Member State and only ca 2,3 million cross-border prescriptions are issued. I'm curious, however, how these new rules would work in practice since they do not prescribe the same appearance, format or language for the prescriptions. See more here.

Food for thought

The European Council pushed forward this week a new regulation that will regulate information duties (and compositional requirements) for four categories of food: infant formula and follow-on formula; processed cereal-based food and baby food for infants and young children; food for special medical purposes; total daily diet food for weight control. On the 20th of December the European Council approved an agreement reached with the European Parliament on foods considered essential for certain vulnerable persons (babies, young children). The new regulation intends to clarify existing rules both for consumers and producers. It will replace the Directive 2009/39/EC on foodstuffs intended for particular nutritional uses and change other instruments (see more here). In the legislative procedure, the European Parliament will now need to adopt it. For an example of rules it contains see below.
"Infant formula and follow-on formula are not allowed to be labelled, presented and advertised in a way that discourages breast-feeding. For the labelling of infant formula and follow-on formula pictures of infants idealising the use of these categories of food are forbidden. Idealising pictures are also proscribed for the presentation and advertising of infant formula.

Foods for sportsmen, milk-based drinks and similar products  marketed as "growing up milks" are excluded from the scope of the new rules. The Commission must, however, report on the necessity of rules for these products after having consulted the European Food Safety Authority (EFSA).

Smokers beware

On the 19th of December the European Commission adopted also its proposal of the Tobacco Products Directive's amendment. The rules on tobacco products' manufacturing, presentation and trade will be strengthened. Among other, it would prohibit the use of cigarettes, roll-you-own tobacco and smokeless tobacco products with characterising flavours. Additionally, it makes it mandatory to use large pictorial health warnings on cigarettes and RYO and regulates cross-border online sales. It would also begin to regulate products like e-cigarettes and herbal products for smoking. The ban on snus (oral tobacco) will be maintained. Chewing and nasal tobacco would be covered by specific labelling and ingredient regulations. More on the revision project may be found here.

Flying without snakes on board

Do you like watching movies like Snakes on a Plane or Air Force One? Well, the EU wants to limit airplanes' accidents to fictional only. On the 19th of December the European Commission proposed new rules to prevent aircraft accidents. The proposal aims to increase and improve the use of data on occurrences as well as improve the flow of information between the Member States, switching the focus from reaction to prevention. "An occurrence is any type of event significant in the context of aviation safety which might or might not have resulted in an actual accident but which merits being collected and analysed." The text of the proposal will now be discussed by the Parliament and the Council.

Investigation into Google continued

This was a busy week for everyone - trying to finish all work issues before Christmas and then starting to prepare for the holiday season, too. The European institutions were busy, too, so let us try to catch up (further) on some of the news regarding European consumer law. 

 On the 18th of December, VP of the European Commission, Joaquin Almunia, announced that he intends to continue to try and reach an agreement with Google, regarding the antitrust behaviour of the latter. As you may recall, BEUC called for effective remedies to be agreed on between the parties (Manipulating online search results). The concerns of the European Commission relate to: 

" - the way in which Google's vertical search services are displayed within general search results as compared to services of competitors; 
 - the way Google may use and display third party content on its vertical search services; 
 - exclusivity agreements for the delivery of Google search advertisements on other websites; and 
 - restrictions in the portability of AdWords advertising campaigns." 

 A detailed commitment text is to be expected from Google in January 2013.

Tuesday, 18 December 2012

Digital Consumers and the Law

A nice thing about the week before the holidays is that usually a lot of packages arrive. The one I just opened contained a new book on 'Digital Consumers and the Law', resulting from a joint project of the Amsterdam Institute for Information Law (IViR) and the Centre for the Study of European Contract Law (CSECL).

The book deals with the following topics: 

Chapter 1 Digital Content Markets for Consumers: Characteristics, Challenges, and Legal Context.
Chapter 2 Classifying Digital Content: Good, Service or Else?. 
Chapter 3 Somewhere between ‘B’ and ‘C’: The Legal Status of the ‘Prosumer’ in European Consumer Laws. 
Chapter 4 Pre-contractual Information Requirements for Digital Content.  
Chapter 5 Conformity and Non-conformity of Digital Content. 
Chapter 6 Educating the Regulator: A More Mature Approach Towards the Underage Consumer.
Chapter 7 Fundamental Rights and Digital Content Contracts.  
Chapter 8 Money Does Not Grow on Trees, It Grows on People: Towards a Model of Privacy as Virtue.  
Chapter 9 Conclusions.

Please refer to the publisher's website for more information.

Lawyers buying into CESL's process

Finally, here is a link to Commissioner Reding's most recent speech on the proposal for a Common European Sales Law, given at the occasion of a debate organised by the Council of Bars and Law Societies of Europe (CCBE) for the purpose of 'buying into the process'. On the point of interpretation of the CESL, which is as important for consumers as it is for professional users of the instrument, Reding observed:

'I also envisage a database that enables courts to draw on existing case-law from all Member States. This database - accessible to everybody, but in particular to all legal practitioners, would ensure transparency and a de-facto convergence of relevant case-law. The database would contain national rulings applying Common European Sales Law provisions as well as translated summaries. This would ensure the consistency of application. In time, this database would also remove the necessity for judges to investigate foreign law and compare several laws. This in turn will help to lower litigation costs and shorten the length of proceedings. 

With this in mind, it is reasonable to expect that the vast majority of issues would be resolved by Member States' courts without problematic inconsistencies. And that only a small number of questions would have to be taken to the Court of Justice in Luxembourg. We should also bear in mind that the Common European Sales Law builds on the biggest common denominator of contract law traditions in Member States. Even though the details are new, it would be a rare occurrence that the concepts and approaches underlying the instrument are alien to the courts that will have to apply them. This will limit the risk of fundamentally differing interpretations.

To support us on this journey we also have excellent work by way of commentaries like that edited by Professor Schulze. I thank you for your tremendous efforts in producing this commentary - which can be seen as a very helpful tool in showing others how the Common European Sales Law will work. 

This is only one tool but nevertheless an important pre-cursor of what is taking place: There will be many others including – as mentioned in your position paper – comments which explain the Common European Sales Law article by article as well as suggestions for a digest to be created linking different court cases to each other.'

To be continued...

How much time did you spend on the internet today?

Fourthly, some interesting facts and figures on internet use were published by the EU's statistical office Eurostat. Although the level of internet access has increased Europe-wide, significant differences in use remain among Member States. While e-mailing and searching for information on goods and services are still at the top of the list of online activities, it seems that a majority of internet users is also more often reading the news online, posting to social media, internet banking and consulting travel services. 

Creating websites and blogging are less common initiatives. Since we are in the blogosphere now, I cannot help but notice the following: 'The Netherlands (17%) and Hungary (16%) recorded a proportion of internet users who created websites and blogs in 2012 that was almost double the EU27 average.'

The full overview of data is available here.

The way forward for ADR and ODR

Thirdly, an update on the progress of the proposals on Alternative Dispute Resolution and Online Dispute Resolution (ADR and ODR): After the vote in the Internal Market and Consumers Committee the proposals now await final adoption by the European Parliament, which is foreseen to take place in the second quarter of 2013. The new rules will then have to be implemented by the Member States and are expected to introduce benefits for consumers seeking to resolve disputes in an efficient and effective manner:

'The rules on ADR will ensure that contractual disputes between consumers and traders are settled out of court through quality alternative dispute resolution entities. These will operate in all Member States and in all sectors, with the exception of health and higher education. 

The ODR Regulation will set up an EU-wide online platform for handling disputes between consumers and traders, arising from online transactions. The platform will link all the national alternative dispute resolution entities and will operate in all official EU languages. Traders will be required to provide consumers with adequate information on ADR and ODR.'

The text of the proposals and accompanying documents may be found here.

Copyright in the digital market

Secondly, the Commission adopted a communication on copyright today, which presents points of action to keep the EU's copyright framework fit for purpose in the digital environment. The Commission's plans comprise the following:

'A structured stakeholder dialogue, jointly led by Commissioners Michel Barnier (Internal Market and Services), Neelie Kroes (Digital Agenda) and Androulla Vassiliou (Education, Culture, Multilingualism and Youth), will be launched in 2013 to seek to deliver rapid progress in four areas through practical industry-led solutions.

These areas are cross-border access and the portability of services; user-generated content and licensing for small-scale users of protected material; facilitating the deposit and online accessibility of films in the EU; and promoting efficient text and data mining for scientific research purposes.

In parallel, the on-going review of the EU framework for copyright legal will be completed, based on market studies, impact assessment and legal drafting work, with a view to a decision in 2014 on whether to table legislative reform proposals.'

Please refer to the press release and website for more information.

On the water

Just before the holidays, there is much consumer-relevant news from the European Commission to report on. To start with, as of today passenger rights that already existed for air and railways travel are extended to Europeans travelling by water.

As summarised by the Commission 'the new rights include:
  1. adequate and accessible information for all passengers before and during their journey, as well as general information about their rights in terminals and on board ships;
  2. adequate assistance such as snacks, meals, refreshments and, where necessary, accommodation up to three nights, with a financial coverage up to €80 per night in case of cancellation or delay at departure of more than 90 minutes;
  3. guaranteed choice between reimbursement or rerouting in case of cancellation or delay at departure of more than 90 minutes;
  4. compensation, between 25% and 50% of the ticket price, in situations of delay at arrival;
  5. non-discriminatory treatment and specific, free-of-charge, assistance for disabled persons and persons with reduced mobility, both at port terminals and on board ships, as well as financial compensation for loss of or damage to their mobility equipment;
  6. mechanisms to handle passenger complaints to be put in place by carriers and terminal operators;
  7. appointment of independent national bodies in charge of enforcing the regulation, where appropriate, through the application of penalties.
In addition, as from 31 December 2012, passengers involved in an accident when travelling by sea will have the following rights under EU law:
  1. financial compensation in case of death, personal injury, and loss of or damage to luggage, vehicles, and mobility or other special equipment;
  2. advance payment (within 15 days) to cover immediate economic needs in case of death or personal injury;
  3. direct recourse against the carrier's insurance provider in case of death or personal injury;
  4. right to receive appropriate and comprehensible information regarding the above rights prior to or –at the latest – upon departure.'
More information is available in the press release and on the Commission's passenger rights website.

Thursday, 13 December 2012

What are the options? - BEUC's position paper on digital products

European consumer organisation BEUC has made no secret of its critical stance toward the European Commission's proposal for an optional instrument that would offer a set of contract terms that parties may, inter alia, choose to apply to their contracts for the supply of digital content (such as films, e-books or music). In particular, BEUC is sceptical of the proposed Common European Sales Law's optional nature, since 'a business selling digital content online will be able to decide between modern European rules or national legislation, which is - as acknowledged by the European Commission - often unclear about the rights to which consumers are entitled in contracts for the supply of digital content. What consumers need is solid legislation applicable to all contracts and not dependent on an opt-in or opt-out basis.'

Yet, what are the alternatives? In a recently published position paper, BEUC outlines the following suggestions for updating the acquis communautaire governing digital content contracts for consumers:

'- A legislative proposal modernising the EU rules on legal guarantees in order to cover digital content products. This could be done via a new Directive on digital content products or in the frame of an eventual revision of the 1999 Sales of Goods Directive. The rules included in chapters 10 and 11 of the CESL could serve as a basis with the appropriate adaptations as indicated in point 5 of this paper.

- Standardisation of key information provided to consumers and the format in which it shall be presented to make this information comprehensible, transparent and easy to access and to read. This initiative should equally take into account the Commission’s own research on consumers’ behaviour towards information load and the way consumption decisions and made.

- Initiatives to address the issues related to lack of the transparency and unfairness of certain contract terms in digital content contracts. They could include guidance on transparency requirements and unfair contract terms, which would help clarify the application of the UCT legislation to digital content contracts and include examples of terms which may be considered unfair under the 1993 Unfair Contract Terms Directive.

- Support better enforcement of EU rules against unfair commercial practices in the field of digital content products through promoting co-ordinated enforcement actions by national consumer organisations and facilitating the co-operation for national enforcement authorities.

- Clarify under which conditions a contract for the supply of digital content can be concluded by a minor.'

Tuesday, 11 December 2012

Back to the pre-antibiotic era?

The European Parliament adopted a resolution today in which it warns against neglecting antimicrobial resistance. Currently, bacteria that are resistant to antimicrobial drugs cause 25,000 deaths a year in the EU, Iceland and Norway. This significant amount suggests that more money should be spent on developing new, better drugs, as well as careful usage of existing drugs and improvements of animal husbandry should be reinforced. (Parliament calls for immediate action to tackle antimicrobial resistance)

I find this news interesting, coming from Poland where you are prescribed antibiotics for anything - it's enough you sneezed a few times, but living in the Netherlands - where you won't get an appointment with a doctor if you haven't been sick at least a week, and where antibiotics are being prescribed only if clear evidence of bacteria has been found (yes, tests would be conducted first). The European Parliament now argues for adoption of prudent-use guidelines to reduce non-essential exposure to antibiotics in human and veterinary medicine, agriculture etc. Basically, the approach of doctors (Polish ones, for sure), pharmacists etc. has to change which could be achieved by providing them with more and better education and training. More comprehensive information should also be given to consumers to make them aware of the harm done by using antimicrobial drugs improperly and they should not be accessible without a prescription.

"The number of resistant bacteria in Europe is exploding. Bacteria travel across borders and are a threat for the whole EU. First of all, we must ensure that the use of antimicrobials for both humans and animals is reduced. But we also need to bridge the gap between rising resistance and development of new antimicrobials by promoting more research and innovation. If we don't take measures now, the growing resistance could threaten our ability to treat patients and could even take us back to the pre-antibiotic era." said Ms Anna Rosbach.

Healthcare of the 21st century: digital

Last Friday the European Commission revealed an eHealth Action Plan which is supposed to optimise the use of digital solutions in Europe's healthcare systems. As a result of the changes it intends to introduce, the patients should gain more control of their care and the costs of healthcare could decrease. So far, most European patients uses only their mobile phones (out of all modern technologies that could be applied to access and assess healthcare systems), e.g., to download smartphone apps to assess their health. The Action Plans wants to clarify areas of legal uncertainty, improve interoperability, increase awareness of digital solutions among patients, support research into personalised medicine, ensure free legal advice for start-up eHealth businesses. We are also promised a mHealth (mobile health) Green Paper by 2014 which would explain and address quality and transparency issues. Additionally, a Staff Working Document was issued which summarises which EU legislation applies currently to cross-border telemedicine. (e.g., as far as liability of healthcare practitioners, licensing systems, and data processing is concerned) (Putting patients in the driving seat: A digital future for healthcare)

Towards faster redress for disappointed shoppers?

Today, negotiators from the European Parliament and the Council found a deal on two prospective pieces of legislation: a Alternative Dispute Resolution directive and and a regulation on  Online Dispute Resolution .
The underlying goal is to provide "impartial mediation to settle disputes between shoppers and traders quickly, effectively and at low cost."
Admittedly, similar mechanisms are already available in many member states, but their effectiveness is hampered by lack of awareness and perfectible infrastructure. 
The harmonised ADR mechanisms should be
  • available for all economic sectors;
  • provided free of charge or only "at a nominal cost";
  • capable of generally resolving issues within 90 days.
In order to raise awareness, traders will have to inform consumers of which ADR bodies they are covered by and how to contact them. Measures must be taken in order to ensure that the arbitrators act impartially. 

A specific regulation will be issued concerning problems arising out of online sales. In this case, an online platform will be accessible through the"Your Europe" Portal to guide shoppers to the most appropriate resolution scheme for their dispute. All steps of the complaints will be dealt with online through a standard complaint form and electronic translation.
The application of EU privacy and data protection rules should make sure that the information concerned is processed correctly. 

What now? The acts will have to be officially endorsed by both organs in the coming months, starting with the Parliament where the texts should be put to plenary  vote early in 2013.

Friday, 7 December 2012

8th consumer scoreboard

What markets are working better for EU citizens? And where is there, to put it nicely, larger room for improvement?
Some answers can be found in the latest Consumers Market Scoreboard, which measures consumers overall appreciation of the markets along seven parameters (‘comparability’, ‘trust’, ‘satisfaction’, ‘choice’ and ‘ease of switching’, plus ‘problems’ and ‘complaints’).
In general, it seems that European consumers find themselves relatively at ease within markets for goods- with the notable but unsurprising exception of second-hand cars...
On the other hand, services markets in general seem to cause more troubles. In particular, at the bottom of the chart lay banking sand telecom services, which perform poorly on several parameters.
European consumers seem also to be at strains with energy markets when it comes to important aspects such as choice, comparability and switching suppliers and tariffs.
Finally, the most remarkable decreases in performance seem to have been taken place in the transport and post-delivery markets as an effect of the crisis. The latter has led governments to curb public subsidies to those sectors. 
Another interesting remark is to be found in the Commission's press release: apparently, "[m]arkets are assessed differently by different socio-demographic groups." Further research with the aim of clarifying the reasons for that is promised (and vividly looked forward to by this author).

Adoption of new Brussels I

Yesterday the Council of the EU adopted the "Brussels I" reform (see our previous post EP endorses Brussels I reform), which means that upon the publication in the Official Journal this new Regulation will enter into force (and become applicable two years thereafter, repealing the existing Brussels I Regulation). The reform is to simplify for business and consumers rules to determine which national court has jurisdiction in cross-border cases and how judgments of courts of one Member State are recognised in another Member State. One of the changes is the abolishment of the expensive 'exequatur' procedure which required companies to obtain a judgment in civil and commercial matters in courts of one Member State before it could be recognised in another EU country (new rules would enable automatic enforceability of judgments across the EU). Another change that was a bit more controversial, but seems to have been pushed forward (see the text adopted by the EP in November can be found here), was to allow consumers to go to a court in the EU Member State in which the consumer was domiciled also against business located outside the EU (see art. 6(1) in connection with art. 18(1)).

Thursday, 6 December 2012

Digital Content Sweep

The European Commission just published the results of a 'sweep investigation' conducted on digital content. This EU-wide screening of websites led the Commission to conclude that about 75% of websites offering digital content (such as music, videos, e-books and games) are not fully complying with European consumer law. In particular, problems are found regarding unfair contract terms, the consumer's right to withdrawal and information on the trader's identity and address.

Please check the press release and Digital Content Sweep website for more information. On the legal framework for digital content contracts for consumers, see also our earlier post 'Reporting on digital content contracts'.

Environmentally friendly consumption

The EU released a great video that aims to motivate consumers to stop food waste. 90 million tons of food is thrown away in the EU every year. At the end of the video there is a disclaimer, btw, that all the food used during the shooting of the clip has been cooked and eaten by the crew. 

Another video that has raised some stir this year that also calls for environmentally friendly consumption was an advert for SodaStream. The ad tries to convince consumers to switch to drinking their soda products by using SodaStream instead of buying bottles of soda - thus 'saving 2000 bottles a year'. Interestingly, the add was banned by the UK broadcast company which only allowed it to become more famous online. (SodaStream's Banned Ad Helps Home Carbonation Company Hit It Big)

No competition - Record fine for TV cartels

Yesterday, the European Commission imposed a record fine of €1.47 billion on a number of international companies that had participated in one or both of two cartels concerning TV and computer monitor tubes. According to the Commission's findings, the companies fixed prices, shared markets, allocated customers between themselves and restricted their output for over a decade (1996-2006).

Several of the companies involved plan to appeal the 'disproportionate and unjustified' fine (see also FT article 'Record €1.47bn fine for TV cartels').

On the basis of EU law, any person or firm affected by anti-competitive behaviour as described in this case may bring the matter before the courts of the Member States and seek damages (cf. CJEU Courage and Manfredi).

More information is available in the European Commission's press release and on its website.

Wednesday, 5 December 2012

Do you copy that? - BEUC's new copyright strategy

In particular in the digital environment, consumers are more and more often facing questions concerning copyright. As the European consumer organisation BEUC puts it in a letter to European Commission President Barroso:

'From the consumers’ point of view, the current copyright framework is far from balanced. In many Member States, copyright law makes the everyday activities of consumers, such as backing up and copying legally bought music, films and e-books in order to play on a different device, illegal. Under current laws, parodies and pastiches which have gained new cultural relevance in the digital ‘mash up’ culture are illegal.'

According to BEUC, the current legal framework regarding consumers' use of copyright protected material is outdated, since it does not sufficiently take into account consumer expectations and the public interest. For that reason, BEUC has now published a Copyright Strategy, which lists specific action points for specific problems on the intersection of consumer law and copyright law. 

As regards consumer rights, BEUC's main suggestions are to:
• Recognise consumers as a key stakeholder in debates and discussions surrounding copyright law on equal footing as creators and copyright users;
• Assess the effectiveness of the current copyright law from the consumers’ perspective;
• Strike a balance by recognising a set of clear, comprehensive and absolute consumers’ rights;
• Revise the Copyright Directive 2001/29 with the aim of establishing a flexible, future-proof and consumer-friendly copyright law;
• Replace the current system of copyright exceptions and limitations with a system of user’s rights.

Tuesday, 4 December 2012

Flying safe

In order to guarantee high air travel safety standards, the European Commission  – in consultation with Member States’ aviation safety authorities – has decided to ban airlines found to be unsafe from operating in European airspace and to impose certain restrictions on other airlines. The list is periodically updated in order to ensure that it reflects up-to-date situations.
The updated European air safety list includes all carriers certified in 20 States, accounting for 287 known air carriers, whose operations are fully banned in the European Union: Afghanistan, Angola, Benin, Republic of Congo, the Democratic Republic of Congo, Djibouti, Equatorial Guinea, Eritrea, Gabon (with the exception of three carriers which operate under restrictions and conditions), Indonesia (with the exception of six carriers), Kazakhstan (with the exception of one carrier which operates under restrictions and conditions), Kyrgyzstan, Liberia, Mozambique, Philippines, Sierra Leone, Sao Tome and Principe, Sudan, Swaziland and Zambia.
The list also includes three individual carriers: Blue Wing Airlines from Surinam, Meridian Airways from Ghana and Conviasa from the Bolivarian Republic of Venezuela.
Additionally, the list includes 10 air carriers which are subject to operational restrictions and are thus allowed to operate into the EU under strict conditions: Air Astana from Kazakhstan as well as Afrijet, Gabon Airlines and SN2AG from Gabon as mentioned before, Air Koryo from the Democratic People Republic of Korea, Airlift International from Ghana, Air Service Comores, Iran Air, TAAG Angolan Airlines and Air Madagascar.

Publishing clinical-trial data

On the 22nd of November a workshop on access to clinical-trial data and transparency was held by the European Medicines Agency. The EMA decided this year to encourage publication of clinical-trial data in order to allow for more re-analysis thereof by stakeholders. However, since this could lead to some practical issues (e.g., regarding patients' data confidentiality) consultations with stakeholders are needed before a specific policy will be established. During the workshop advisory groups were established (participation in them is still open) that would analyse and present their findings by the end of April 2013 on the following issues: protection of patient confidentiality, clinical-trial-data formats, rules of engagement, good analysis practice, legal  aspects. The pro-active publication of clinical-trial data is expected to come into force on 1 January 2014.

Let it snow!

Since snow is gradually making an appearance across Europe, let us take a look at the ECC-Net report on ski resorts in Europe. The European Consumer Centres Network recognises that skiing (followed by snowboarding, cross-country skiing) is one of the most popular leisure-activities in many European countries. Therefore, it conducted a survey of 26 countries on winter sport resorts to support consumers in their choice of suitable winter vacation. The report is to make it easier for consumers to compare offers of winter holidays in various European countries, showing differences in prices and highlighting custom-made options (like family reductions) in a structured, transparent way.

Friday, 30 November 2012

Towards better allocation of household budgets

This month a Working Group Report on Transparency in EU Retail Energy Markets was released, specially for the 5th Citizens' Energy Forum. The report aims to enable more consumer empowerment with respect to well-informed choice of how to allocate household budgets. (p. 4) In that respect, it addresses and evaluates the European energy policy from the perspective of its influence on consumers. (p. 5)
"With this in mind, EU energy policy measures have been developed with the aim of delivering meaningful and tangible benefits for consumers. In particular, internal energy market legislation combines high standards of consumer protection with the liberalisation of gas and electricity (wholesale and retail) markets. The rationale behind this dual focus is to establish the basis for creating choice and price competition for consumers without compromising their rights in any way." (p.5)
Some of the shortcomings of the policy that have been identified in the report are the difficulties in exercising choice and finding offers that are meaningful to consumers, especially household consumers. For many consumers the liberalised energy market is too complex and difficult to take part in. The EU should try to offer not only a legal right to consumers to choose their energy supplier, but also to enable them exercising this right and provide them with more gains, in terms of price and quality, for doing so. In that respect, consumers need to be made more aware of their rights and be encouraged to participate in the market. (p. 6) 
Consumer organisations note, e.g., that introduction of smart technologies and demand response policies may complicate the tariffs systems. Policy makers should make sure that the trend to tariff simplification is upheld. (p. 7) The report notices that the main problem currently relates to lack of transparency (reliable and timely information is a rarity) and price formation.
The report further presents a short summary of European and national legislation on electricity and gas supply to consumers, marketing of such services as well as pre-contractual information that needs to be provided to consumers. (chapter 2) Chapter 3 addresses consumer understanding of offers and marketing, pointing out major issues and good practices, e.g. how to assess consumers' cognitive skills. Chapter 4 focuses on enforcement issues, addressing the role of national authorities. Chapter 5 recommends new policy measures to improve transparency.

Thursday, 29 November 2012

Green paper on cross-border parcel delivery

The European Commission has just launched a consultation with stakeholders to collect information on the current state of the delivery markets for products bought online, and to identify any potential hurdles for the creation of an EU-wide integrated parcel delivery market. 
The consultation is open to not only to businesses, but to "virtually everyone who sends or receives parcels". In order to encourage participation of stakeholders (potentially, most of us)respondents do not need to answer every question but can choose the issues that interest them. 
Delivery services are already regulated at the European level, but the concerned legislation was not conceived to explicitly address the modern needs of consumers who buy online.Contributions can be submitted by 15 February 2013. They will later be published on the Commission's website and the Commission will present actions to be taken as "to complete the internal market for parcels". 
For some relevant fats and figures, have a look at the Commission's memo.

Wednesday, 28 November 2012

Improving data protection in the EU

On the 19th of November the European Commission adopted a recommendation according to which it would be able to renegotiate the Council of Europe Data Protection Convention, Convention 108, on behalf of the EU. The goal is to increase the current level of protection of fundamental rights offered in processing of personal data. This change would go hand in hand with the planned reform of data protection rules (see: here). The European Commission hopes also to export the EU's standard of data protection beyond Europe. (Commission to renegotiate Council of Europe Data Protection Convention on behalf of the EU)

A few days later, on the 23rd of November, the European Data Protection Supervisor (EDPS) adopted a Policy on Consultations in the field of Supervision & Enforcement. This policy points out to EU institutions and bodies, as well as Data Protection Officers (DPOs) when to consult the EDPS when they draft any rules involving processing of personal information (e.g., contract tenders, requests for information, video surveillance etc.). The aim of the policy is to better protect personal data of the EU staff but also of EU citizens (consumers) in procedures that take place at a higher level of administration.

Giovanni Buttarelli, Assistant EDPS, says "In order to effectively respect the fundamental right to data protection of staff and citizens, EU institutions and bodies must ensure accountability when developing and implementing internal measures and from the outset, seek the expert advice of their Data Protection Officer. If the DPO needs guidance, for example in cases of complexity or when related to appreciable risks to the rights and freedoms of data subjects, the DPO or the institution may refer a consultation to the EDPS." (EDPS: greater accountability of EU institutions and bodies and involvement of DPOs for better data protection)

Tuesday, 27 November 2012

Better Internet for Children

The Council of the EU adopted at a meeting yesterday its conclusions on the European strategy for a Better Internet for Children. (see our earlier posts on this subject: Children Online, or EU needs to better monitor this new reality, or Big online wolf) It endorses European Commission's proposal while recommending actions to be taken in the areas of: assuring more quality of online content for children (understood as the content that benefits children in some way in addition to being attractive, usable, reliable and safe); stepping-up awareness and empowerment (e.g. by including the teaching of online safety and digital competences in schools; by further developing media literacy; by improving parental control tools). The Council expects the final report on this subject from the Coalition in January 2013.

A year after EU action: from 30 to 75% of compliant websites offering consumer credits online

Last week the follow-up results of a Consumer Credit sweep from 2011 were made public. A 'sweep' is an exercise to enforce EU law. Under a supervision of EU institutions, national enforcement authorities conduct simultaneous, coordinated investigations - looking for breaches in consumer law in a particular sector. In case any irregularities are discovered, website operators are contacted and asked to correct them. In September 2011 it was time for examination of websites offering consumer credits to consumers. In total, 565 websites across 27 Member States, Norway and Iceland were checked. Unfortunately, at that time only 30% passed the test for compliance with the applicable EU consumer rules (e.g. regarding information duties, right of withdrawal). Out of the remaining websites: "A year later, 57 additional sites were finally considered to be compliant, 18 websites no longer exist, 194 websites were corrected following action by the national authorities and 124 websites are still the subject of administrative or legal proceedings in the countries concerned." (Buying consumer credit on-line: following EU action, over 75% of websites checked now give satisfactory information to clients) As a result of European intervention of the percentage of websites that comply with consumer protection rules has significantly increased, since only ca 23% of websites remain questioned as to their compliance. The main problems that were reported was missing information in consumer credit advertising (e.g. on the APR - annual percentage rate of change, or on standard information) or in the offer itself, as well as misleading presentation of the costs (e.g. type of interest rate, duration of the credit). See further here.

Thursday, 22 November 2012

Protecting privacy while collecting debts - CJEU in C-119/12 (Probst)

The CJEU issued one more judgment today regarding consumer protection in the case C-119/12 (Probst). This case concerns interpretation of Art. 6 Par. 2 and 5 of the Directive on privacy and electronic communications. Specifically, the question was whether a service provider is allowed to transfer traffic data to the assignee of a claim for payment in respect of telecommunication services, especially when in addition to the general obligation to respect the privacy of telecommunications and to ensure data protection of consumers' data, other confidentiality stipulations have been made.

Mr Probst, a German consumer, was the owner of a telephone line provided by Deutsche Telekom AG, through which his computer connected to the internet. In 2009 he occasionally accessed internet through the number provided by Verizon. Deutsche Telekom listed these charges as 'amounts due to other providers' on its bills. Since Mr Probst did not pay these amounts, they were later claimed by nexnet - as asignee of that debt pursuant to a factoring contract concluded between the legal predecessors to Verizon and to nexnet.

The CJEU decided that indeed such transfer 'of traffic data to the assignee of its claims for payment in respect of the supply of telecommunications services for the purpose of recovery of those claims' as well as 'authorising that assignee to process those data' was allowed. Provided that the assignee 'acted under the authority of the service provider' and 'confined itself to processing the traffic data necessary for the purposes or recovering the claims assigned'. The contract concluded between the service provider and the assignee had to guarantee that the processing of traffic data by the assignee would take place exclusively under the control of the service provider and on its instructions. (Par. 27) The CJEU decided that in the given case it was for the national court to decide whether these conditions were fulfilled, however, a factoring contract that was concluded between the parties suggested that this was the case. (Par. 28)

Two more decisions concerning air passengers

Today, the Court of Justice of the EU has released two judgements which European consumers/travellers might want to know about. 
In the first one, Case C-139/11 (Joan Cuadrench Moré v KLM), it established that, in the case of passengers seeking damages for the cancellation of a flight under Regulation 261/2004, the time-limits for bringing an action are to be determined by the Member States in accordance with the principles of effectiveness and equivalence in relation to the procedural rules laid down by national law in respect of similar situations. Since the Regulation put in place a system of protection that is additional to those laid down in the Warsaw and Montreal Conventions, the two-year time-limit provided by those treaties does not apply.

In the second decision, Case C-410/11 (Pedro Espada Sánchez and Others v Iberia), the Court was called to interpret the just-mentioned Montreal Convention, or the Convention for the Unification of Certain Rules for International Carriage, to which the EU has adhered. 
The question concerned a family of four people (a Spanish couple and their two children) whose luggage went lost during a flight operated by Iberia. The Montreal Convention provides that an air carrier must pay compensation to each passenger, in the event of the loss of his baggage. In the claimants' case, the luggage of all four passengers had been put in two suitcases. The question before the Court, subsequently, was whether it was possible for the family to also claim damages for the luggage which had been not checked in under the requesting passenger's name. 
The court answered that, in light of the Convention's objectives, it must be possible for a passenger to claim damages for the loss of luggage which had been checked in under another passenger's name. The claimant must prove that the lost baggage did in fact contain his belongings. In making its assessment, the national court may take into account the fact that the concerned passengers are members of the same family, that they bought their tickets together or that they checked in at the same time.

Better information on delayed train connections - CJEU judgment in Case C-136/11 Westbahn Management v ÖBB Infrastruktur

This morning, the Court of Justice of the EU handed down its judgment in the Westbahn case. The Court reaches conclusions similar to those of the Advocate General (discussed earlier on this blog: 'Better information on delayed train connections - opinion of AG Jääskinen'). As summarised in the press release:

'Railway undertakings are therefore obliged to provide information relating to the main connecting services in real time.

The Court finds that that obligation relates to all main connecting services, both those of the railway undertaking concerned and those operated by other undertakings. A restrictive interpretation of the information to which passengers must have access would hinder transfers by them. It would compromise the objective of providing information pursued by EU law, by encouraging passengers to give preference to large railway undertakings which would be in a position to provide them in real time with information relating to all stages of their journey. 

As to the obligations of the railway infrastructure manager, the Court observes that, to ensure fair competition on the passenger rail transport market, it must be ensured that all railway undertakings are in a position to provide passengers with a comparable quality of service. Railway undertakings must therefore, for the purposes of the exercise of the right of access to railway infrastructure, be given information by the infrastructure manager in real time relating to the main connecting services operated by other railway undertakings. 

In this connection the Court notes that information which is available on screens at the various stations cannot be regarded as being of a confidential or sensitive nature which would prevent its disclosure to the various railway undertakings concerned. 

The Court therefore holds that the infrastructure manager is required to make available to undertakings, in a non-discriminatory manner, real time data relating to trains operated by other undertakings, in so far as those trains provide main connecting services.'

Wednesday, 21 November 2012

European fees for card payments?

Another resolution that was adopted yesterday by the European Parliament concerned EU rules for card payments and aimed at further harmonising cross-border payments. Moreover, it could remove fake fees - that unnecessarily make payments with cards more expensive in relation to their actual cost. Interestingly, the MEPs believe this could be achieved just by introducing transparency in the market, since competition would take care of properly set fees then (no need for capping). All in all, the MEPs argue for common rules for personal credit and debit card payments, which rules could be based on the ones developed for cross-border bank transfers (SEPA - single Euro payments area). The MEPs also looked ahead and expressed a less urgent need to unify the rules for internet and mobile payments in the future, as well. (Towards common fees for card payments)

Big online wolf

One of the most controversial issues regarding the safety of internet users and their privacy online is the protection of children online. While children use internet more and more often ("All young Europeans aged 9 to 16 use a computer to play or do their homework, and half of those between 11 and 16 say they find it easier to express themselves on line than in real life, according to a survey done in the member states.", see: Parliament calls for better protection for children), they may be faced with internet fraud, online violence, pornography, harassment etc.

Yesterday, the European Commission Vice President for the Digital Agenda - Neelie Kroes - and the US Secretary of Homeland Security - Janet Napolitano - signed a Joint Declaration promising to safeguard children in their online endeavours. The promises stretch to organising, annually, joint campaigns on the Safer Internet Day, further combating child sexual abuse online worldwide, working on giving parents and guardians informed choices online as to the content their children are able to access. (EU and US sign joint declaration to make the internet safer for kids) Interestingly, on the same day the European Parliament adopted a resolution in which it calls for better protection for children online, arguing for an increase of educational campaigns about digital media, as well as easier and more accessible means to report online abuse.

Parliament vote approves new designate-SANCO commissioner

The new Maltese commissioner
As anticipated last week, the European Parliament voted today on the appointment of mr Tonio Borg as the new Health, Consumers and Environment commissioner.
The parliament expressed its position by a secret vote which resulted in approval by a majority of 386 vs 281 votes and 28 abstentions. If you want to know more about the procedure and the new commissioner, the devoted pages on the Parliament's website are a powerful source of information.

Tuesday, 20 November 2012

EP endorses Brussels I reform

Today, the European Parliament expressed its support for the European Commission's proposals to reform the rules concerning the recognition and enforcement of judgments among EU Member States. This reform of the Brussels I Regulation entails the abolishment of the 'exequatur' procedure that is currently required to get a judgment in civil and commercial matters recognised in another EU country. The Commission expects that the reform will save businesses and consumers up to 48 million euro a year.

The European Commission indicates that the draft legislation will now pass to the Council for final adoption, which is expected to take place in the Council of Justice Ministers next month.

See the Commission's press release for further information.

Monday, 19 November 2012

Healthy week

Last week there have been lots of news regarding European consumers' safety & health. And so:

  •  The European Monitoring Centre for Drugs and Drug Addiction (EMCDDA) published an annual report for 2012 which showed that heroin use (responsible for the largest share of drug-related diseases and deaths) is in decline in Europe and that, in general, patterns of drug use are shifting (to other opioids, like fentanyl, buprenorphine etc. but also cathinones, amphetamines etc.). There is also a decline in reported cases of drug injections. To read more about drug use and related diseases in Europe see here.
  • The same report as mentioned above expresses its concerns about the increased European market for powders and pills. European are the most prone to the use of cocaine, ecstasy and amphetamines, but the synthetic drugs' and stimulants' market is emerging further (e.g. cathinones, methamphetamine). More on this here.
  • Health spending in Europe fell in 2010 for the first time in decades as the report 'Health at a glance' of the OECD and the European Commission announces. A summary of the main findings of the report may be found here.
  • European Medicines Agency (EMA) recommended approval of the first vaccine for bacterial meningitis B, Bexsero which hopefully will decrease the rate of fatal cases of this disease (currently ca 8% of European patients) affecting mostly infants and young children. More information - see here.
  • Yesterday, there was the European Antibiotic Awareness Day. You can read key facts on the fight against antimicrobial resistance (AMR) here.
  • World Health Organization (WHO) during its Conference of the Parties signed on 12th November a new protocol - on the Elimination of the Illicit Trade in Tobacco Products. New, effective measures against illicit trading would benefit consumers, since they should safeguard existing norms on controlling the quality of tobacco and its labelling.See more here.
  • Last week the European Food Safety Authority (EFSA) celebrated its 10 years. More information on the agency may be found here.

Friday, 16 November 2012

Facts and figures on misleading advertising

The results of the European Commission's public consultation on the Directive on Misleading and Comparative Advertising were published yesterday. You may find a full overview of the results here. Summarising, the Commission notes:

'Respondents brought many different cases of misleading marketing practices to our attention, often involving several Member States. The most frequent misleading practices are rather similar: A dishonest trader deceives a victim into giving consent and a contract is concluded with little or no service in return, but with an exorbitant price and abusive contractual conditions. Afterwards, the trader uses all possible means to enforce the payment.

Misleading marketing practices concern mainly SMEs and independent professionals but other types of businesses and organisations are also affected. Increasingly fraudsters make use of the internet.

Most respondents want the European Commission to increase protection of SMEs and independent professionals against misleading marketing practices. According to respondents, the biggest problem is inefficient enforcement of the Misleading and Comparative Advertising Directive at cross-border level. However, also the substantive rules are considered too weak and unclear to be effective against such schemes.'

Wednesday, 14 November 2012

MEPs question new designate-commissioner

As many readers will have learned from the newspaper, the Maltese EU commissioner John Dalli was forced to resign last month following his-however slight- involvement into a fraud case investigated by the Commission.
The Maltese government has subsequently designated Dalli's successor in the person of mr. Tonio Borg.
The latter, as foreseen by the appointment procedure, was heard yesterday by MPs on a wide series of topics.
In his opening speech, the Commissioner declared his commitment to fostering the welfare of european consumers and promised that, if elected, he would "propose legislation, including on tobacco products, cloning of animals for food, novel foods, product safety, plant and animal health and access to bank accounts."

Tobacco products were a specially sensitive issue since their regulation, and the delay in adopting new European rules,  were the grounds for the scandal which involved Mr. Borg's predecessor.

Other contentious issues concerned the nominee's positions on sensitive topics such as women's rights and non-discrimination.

More sector-specific commitments ware asked in the fields of cloning, GMOs, consumers, animal transport.

Internal consultations will now be held within the Parliament, which is expected to come out with its (non-binding) verdict through the vote of a resolution in the course of next week.

Tuesday, 13 November 2012

Protecting consumers through injunctions

Last week the European Commission published its second report on the application of the Directive 2009/22/EC on injunctions for the protection of consumers' interest. This Directive allows public authorities and consumer organisations to seek an injunction to put a stop to a trader's practice that infringes EU rules on consumer protection. Therefore, it allows for protection of collective interests of European consumers. The first report showed, however, that the procedures weren't used so much in cross-border conflicts, due to mostly their higher costs, complexity and length of time.  

The new report describes application of the Directive from 2008 onwards. It still shows that the majority of injunctions asked for were national. The highest number of injunctions was reported in Germany, Latvia, the UK, Austria and Malta. The injunctions mostly affect the telecommunications, banking and investments as well as tourism and package travel sectors. The practices that most frequently resulted in an action for injunction were unfair contract terms and unfair commercial practices. The report points out that EU consumers definitely benefit from the introduction of the Directive, however, the introduced measures are more effective for protecting consumers in the future rather than correcting past damage. Injunctions may not be perceived as a remedy for claiming damages nor are they effective against rough traders. Most Member States do not make a link between a possibility of consumer's individual (or collective) redress and granting an injunction and often are not even bound by the earlier ruling on the injunction. However, injunctions can still benefit many consumers. For example:

"For instance, in Austria an action for injunction was brought against unfair terms in the banking contracts of an Austrian bank. In August 2009 the bank informed its customers in the statement of accounts that prices for current accounts were to be increased as from 1 October in line with the increase of the consumer-price index for 2008, which amounted an increase of 3.2%. The bank referred to the index-clause in the Standard Contract Terms, which allowed the bank to automatically increase prices for continuing obligations once a year, according to the movements of the consumer-price index. This injunction measure had a significant impact on consumers, because in spring 2011 most of the other banks, which had used similar terms, refrained from automatically increasing the price, and this benefited several million clients of Austrian banks. This is a clear instance of a successful injunction having a tangible impact on compliance with the law, not only with regard to the defendant, but for the whole economic sector. Moreover, the benefit for consumers was easy to evaluate in monetary terms."(pp. 8-9)

The report identifies also problems that prevent the Injunctions Directive from being more effective, namely: financial risks linked to the proceedings, their length and complexity, limited legal effect of the rulings and obstacles in enforcement thereof. The European Commission concludes the report stating that it will continue to monitor the application of the Directive and does not see the need to amend it at this stage.

Thursday, 8 November 2012

On proportionality - AG Kokott's opinion in Case C-415/11 Aziz v Catalunyacaixa

Today, Advocate General Kokott delivered her opinion in the case Aziz v Catalunyacaixa, which is currently pending before the Court of Justice of the European Union. This latest addition to the line of Spanish cases concerning the application of Directive 93/13 on Unfair Terms in Consumer Contracts (incl. Océano, Mostaza Claro, Asturcom and Calderón Camino) involved the assessment of a standard term in a loan agreement in the context of mortgage foreclosure proceedings. The referring judge in particular asked for clarification of the concept of '(dis)proportionality' in the context of ex officio judicial evaluation of the unfairness of certain standard clauses in consumer credit contracts.

The facts of the case were the following: In order to finance the purchase of a family home, Mr Aziz had concluded a loan agreement with the Catalunyacaixa bank, security for which was provided by a mortgage on the house. When Aziz got into financial problems and failed to pay the monthly instalments of the loan on a regular basis, the bank made use of its contractual option to terminate the contract earlier (a so-called 'acceleration clause') and claim back the total amount of the loan. Furthermore, the bank started mortgage foreclosure proceedings regarding Aziz's property. In these proceedings, under Spanish law there are only limited grounds for objection against the foreclosure, none of which was applicable in this case. Moreover, Aziz did not appear in these proceedings nor manage to prevent the public sale of the house by paying the remaining amount of the loan plus interest and costs. Following a public sale that attracted no bidders, the bank obtained property of the house for 50% of its contractually established value. Consequently, Aziz lost ownership of the house and was left with a remaining debt to the bank amounting to 40,000 euro. In order to put the bank in possession of the house, finally, Aziz was evicted from the property.

In the proceedings that gave rise to the preliminary question to the CJEU, Aziz requested the Juzgado de lo Mercantil n° 3 of Barcelona to declare the nullity of the standard contract term regarding judicial foreclosure, thus effectively annulling the outcome of the procedure. The referring judge raised the following preliminary questions:

'Whether the system of levying execution, in reliance on judicial documents, on mortgaged or pledged property provided for in Article 695 et seq of the Ley de Enjuiciamiento Civil (Code of Civil Procedure), with its limitations regarding the grounds of objection available under Spanish procedural law, may be nothing more than a clear limitation of consumer protection since it involves, both formally and substantively, a clear impediment to the consumer's exercise of rights of action or judicial remedies of such a kind as to guarantee the effective protection of his rights.

This reference to the Court of Justice of the European Union is made so that the concept of disproportion can be expanded upon with regard to:

(a) the use of acceleration clauses in contracts planned to last for a considerable time - in this case 33 years - for events of default occurring within a very limited specific period;

(b) the setting of default interest rates - in this case exceeding 18% - which are not consistent with the criteria for determining default interest in other consumer contracts (consumer credit), which, in other types of consumer contracts, might be regarded as unfair, and which, nevertheless, in contracts relating to immovable property, are not subject to any clear legal limit, even where they are applied not only to the instalments that have already fallen due but also to the totality of those that have become due as a result of acceleration;

(c) the unilateral establishment by the lender of mechanisms for the calculation and determination of variable interest - both ordinary and default interest - which are linked to the possibility of mortgage enforcement and do not allow a debtor who is subject to enforcement to object to the quantification of the debt in the enforcement proceedings themselves but require him to resort to declaratory proceedings in which a final decision will not be given before enforcement has been completed or, at least, the debtor will have lost the property mortgaged or charged by way of guarantee - a matter of great importance when the loan is sought for the purchase of a dwelling and enforcement gives rise to eviction from the property.'

In reply to the first question, Advocate General Kokott considers that a mortgage foreclosure system that limits the possibilities to object against the execution is incompatible with the Unfair Terms Directive if it impedes the consumer from obtaining effective judicial protection in the foreclosure proceedings as well as in separate proceedings aimed at enforcing the consumer's rights under the Directive (para. 58). Effective judicial protection could, for instance, take the form of the possibility for the judge to suspend foreclosure proceedings while the assessment of an unfair term is pending (para. 57).

In reply to the second question, subdivided in three questions regarding specific contract terms, the Advocate General holds that:

(a) it is for the national judge to assess the unfair nature of the acceleration clause, evaluating whether (and if so, to what extent) the clause deviates from the applicable law, whether there is an objective reason for including the clause and whether the shifting of the contractual balance does not deprive the consumer of effective protection (paras. 68-80);

(b) as regards a clause on a default interest rate, the national judge has to assess, in particular, to what extent the interest rate deviates from the otherwise applicable legal interest rate and whether it is proportionate with an eye on the aim pursued through the clause (paras. 81-88); and

(c) concerning a clause on the unilateral determination of the amount of variable interest, the national judge needs to pay special attention to the clause's consequences within the national system of procedural law (paras. 89-96).