Thursday, 5 December 2013

Consumer protection associations require less protection than consumers - CJEU in C-413/12 (ACICL v. ASE)

5 December 2013: CJEU judgment in C-413/12 (Asociación de Consumidores Independientes de Castilla y León v. Anuntis Segundamano España SL)

Unfair Contract Terms Directive enables not only consumers to claim unfairness of contractual provisions included in their specific contracts, but it also gives a possibility to consumer protection organisations to represent consumers in claiming unfairness of certain contractual provisions in abstracto. In the case adjudicated today the CJEU was asked to assess on what conditions consumer protection organisations may start such proceedings.

A Spanisch consumer protection association - ACICL - has its registered office in Salamanca, 110 members and limits its activity to the territory of the province Castilla y León. It asked for an injunction before the court in Salamanca against ASE - a commercial company registered in Barcelona. ASE manages a website on which various parties, both professional and non-professional, may publish advertisements concerning real estate and second-hand goods, but also employment. Standard contract terms of ASE contained two provisions (limiting liability and guarantees), pursuant to ACICL, which should be seen as unfair and ASE should be prohibited from using them in the future. The court in Salamanca refused, however, to preside over the case finding that it did not have jursidiction in the matter, since Spanish law obligates consumer protection association to start injunction proceedings before the court of the defendant's residence. 

CJEU was asked whether the high level of consumer protection argued for in the Directive should not preclude such national procedural provisions that force a consumer protection association to ask for an injunction before the court where the defendant has its residence. Moreover, the inability to appeal from a court's decision to refuse jurisdiction was questioned. After all, contractual clauses that force consumers to start proceedings before the courts other than of his domicile are often recognized as unfair. However, the CJEU does not consider consumer protection associations to be in the same inferior position with regards to the seller or a service provider, as a consumer would be in. (Par. 48)

The CJEU decided today that national law may require consumer protection associations to bring injunction proceedings before the court where the defendant has its residence and there is no need for appeal proceedings to be granted in case jursidiction is denied. While Art. 7 of the Directive obligates Member States to enable consumer protection associations to represent consumers interests by asking for an injunction against the continued use of injunctions, the Directive does not contain any provisions that would regulate which national court should have a jurisdiction or how many instances of jurisidiction are given. (Par. 28) This issue has also not been regulated in the Injunctions Directive. (Par. 29) There is, therefore, no harmonized procedure on the matter. The principles of effectiveness and equivalence are also not seen as having been infringed. The CJEU does not consider the fact that the ACICL may not have financial means to start an injunction procedure at a court that is far away from its own offices an obstacle that results from the existence of the national procedural rules, but rather from the assciation's financial situation. (Par. 37) The general procedural rules aim at protecting justice and foreseeability and are given priority here over individual interests, that is, specific financial situation of a party. (Par. 38) The answer of the CJEU could be different if the procedure was a cross-border one, since then it may not be expected of the organisation to have to start a case only before the court's of the trader's country of residence (see Henkel - par. 47).

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