Calling for better air passengers' rights

The European Parliament was discussing today certain issues concerning air travel. The Transport and Tourism Committee voted on a new resolution on air passengers' rights (Air travel: Transport Committee calls for a fair deal for all passengers). The resolution calls on the European Commission to clarify air passengers' rights, ensure uniform application of the appropriate provisions, as well as to improve the enforcement thereof with regard to airlines that breach these provisions. 

The members of the EP are convinced that air carriers should provide a contact personnel at each airport, who would be able to take immediate decisions on assistance, reimbursement, rerouting and rebooking in the even of flight disruption. Moreover, each carrier should have a central information point, a website, as well as a low-cost phone number and email address that would be open to accept consumers' complaints.

The price of a flight ticket that is advertised online should include all charges (otherwise, it should be considered to constitute an unfair commercial practice). Passengers should have an option to withdraw from an online booking within 2 hours of booking. They should also have an option to correct minor booking errors.

National sanctions with respect to air carriers that breach EU rules should be made more effective. European Commission could also draw up and publish airline performance records, based on the annual number of complaints. Moreover, the passenger's complaint should not be processed for more than 2 months by an airline and 2 months by an enforcement agency.

The extraordinary circumstances under which the compensation does not need to be paid by the airlines should be clarified (including rulings of the ECJ on the subject).

In other news, the Civil Liberties Committee debated today on data protection of EU air passengers who travel to the US (MEPs divided over transfer of EU air passengers' data to the US). The passenger data agreement with the US will be voted on the 26th of March. At this point, the members of the EP are divided as to their assessment of it. There are doubts whether sufficient balance was reached between security issues and passengers' data protection. Another issue that was being discussed was the proposal for the EU Passenger Name Records, i.e., a proposal to collect and store passengers' data for international flights arriving in and departing from the EU.

More affordable roaming?

To continue with the previous post, the Industry Committee decided today that as of June 2012 retails clients should be able to buy roaming services from suppliers other than their home service suppliers (Industry committee sets out to lower mobile roaming rates). This means that a consumer could keep his phone number and his service provider for domestic use of his phone, and choose another operator only for foreign calls. If the proposal for this regulation is upheld, that would lead to more competition among roaming service suppliers and possibly lowering of prices for these services. Another proposal is to lower roaming price caps for calls and SMS texts, as well as to cap retail data roaming charges (the currently binding cap expires in June 2012).

Enhanced European communication network by 2020

Neelie Kroes, Vice-President of the European Commission who is responsible for the Digital Agenda, gave a speech yesterday in Barcelona with a few promises concerning further development of European communication network (speech text may be found here). She intends to make sure that every European has at least 30 Megabit coverage by 2020 (4G technology may come in handy here) and at least half of them have ultra-fast access at over 100 Megabits. To achieve this aim she intends to support development of many new technologies, that if combined could lead to to European consumers getting used to obtaining better services and higher speeds (e.g. Fibre-to-the-Home, upgraded Cable, Fibre-to-the-Cabinet, LTE).

"European consumers will get used to obtaining better services and higher speeds, which will trigger new bandwidth-hungry applications and services, creating in turn the conditions for financing the competitive networks, wired and wireless, fixed and mobile, of 2020."

To encourage that development the European Commission has already released the digital dividend 800 Megahertz band for wireless broadband, which should be authorized by the Member States to be used by 1 January 2013 (six MS have already completed this process). New plans encompass finding and releasing more of wireless broadband by 2015 for e.g. radio programmes.

Finally, the EC encourages more competitive and sound policies regarding mobile phones use by consumers. From 2002 to 2010, mobile prices dropped 50% or more, but the aim is to lower these prices even more. Roaming regulations need to be adopted, as well, so that consumers may get the most value from the use of their smartphones also when travelling abroad.

Naughty Member States

Once again European Commission needs to closely monitor Member States in order to enforce proper consumer protection.

Slovakia was called to ensure proper implementation of the Directive 2009/22/EC on injunctions for the protection of consumers' interests. Based on the provisions of this Directive Member States need to enable consumer associations and organizations to ask for an injunction against a commercial operator to immediately cease its activities which go against certain consumer interests (e.g. misleading advertising). In Slovakia, this is not possible in the area of services as well as timeshare contracts, which goes against the provisions of the Directive (Consumers: Commission calls on Slovakia to ensure full protection of consumers' interests).

Luxembourg needs to adjust their laws as far as awarding study grants, financial aid for volunteers and other allowances is concerned. Currently many of these benefits are only accessible to residents of Luxembourg which discriminates against migrant workers and infringes the principle of freedom of movement of workers. (Free movement of workers: Commission asks Luxembourg to end discrimination in access to study grants and allowances)

The production of wine and its strict regulation has previously been mentioned on this blog. Recently, the issue that many wines that we are drinking are not actually made-of-grapes-wines has been raised on the news. In France, for example, the by-products of winemaking are used in the production of wine spirits and wine distillates and these spirits are later on marketed as "eaux-de-vie de vin" or "distillats de vin". The European Commission, correctly in my opinion, aims at banning such marketing as an infringement of provisions of the Regulation No 110/2008 on spirit drinks. The fact that French winemakers were able to use by-products of winemaking (which are cheap) to produce spirit drinks, while in other Member States actual wine needed to be produced, created a competitive disadvantage for winemakers across Europe. Therefore, French law needs to be amended in this regard. (Agriculture: Commission asks France to comply with European rules on marketing wine spirits and wine distillates) One could also consider that these marketing names are potentially confusing and misleading to consumers. The French names refer to wine, after all, although the raw materials used for production of these spirits are actually only by-products of winemaking.

Finally, Austria, Cyprus and Greece were asked to adjust their legislation in order to properly implement the Blue Card Directive, which should have been transposed by 19 June 2011. Pursuant to the provisions of this Directive, highly skilled people from outside Europe are easier enabled to come and work in Europe, filling gaps that cannot be filled by EU nationals. It establishes a fast-track admission procedure for these foreigners and ensures a common set of social and economic rights, such as equal treatment with nationals as regards working conditions and pay, as well as access to goods and services. ('Blue Card': Commission warns Member States over red tape facing highly qualified migrants)

How to switch bank accounts remains a mystery

Last week a consumer market study was published on consumers' experiences with bank account switching (Consumer Market Study on the consumers' experiences with bank account switching with reference to the Common Principles on Bank Account Switching). Already in 2007 the European Commission discovered that banks don't enable consumers to easily move their accounts if they choose to do so and urged the Banking Industry Committee (EBIC) to remove existing barrierts to customer mobility. As a result, the EBIC esatblished a self regulatory initiative which was intended to bring clarity to consumers. Therefore, as of November 2009 it was supposed to be easier for consumers to change their bank account from a current bank to another bank (Changing your bank). In general, the consumers were only supposed to make a request to a new bank who would then, in theory, help the consumer through the switching process, transfer all standing orders and direct debits to the new bank etc. Unfortunately, the new study showed that this clarity was not achieved.

Only 19% of mystery shoppers were able to successfully open a bank account with a new bank and switch a standing order based on the process described in the new self-regulatory guidelines. Shoppers claimed that 71% of banks did not assist in the transfer, which meant that they did not follow self-regulatory guidelines, 7% took more than 14 working days to open an account or switch an order. The study also showed that bank staff was not always aware of switching accounts' procedures and that the level of information that consumers could receive about this varied significantly (14% consumers received no information at all).

EU Internal Market Commissioner Michel Barnier said "The results of the study published today explain why consumers change their banks so rarely. If consumers are not able to easily switch bank accounts, they cannot take advantage of better and cheaper banking services on offer elsewhere. The single market is thus deprived of the competitive drive that leads to innovation, cost savings and better quality banking services. This, in the long-run, can prove to be an obstacle to growth". (Consumers: Switching bank accounts - 8 out of 10 mystery shoppers faced difficulties)



50 years of consumer rights

On 15 March 1962, President John F. Kennedy read his famous 'Special Message on Protecting Consumer Interest' to the American Congress. The 50 year anniversary of this event will, among other things, be celebrated with a conference in Utrecht on 'world consumer day', 15 March 2012.

2012 also marks the 50th birthday of the European consumer organisation BEUC. An overview of BEUC's achievements over the years can be found on the special website dedicated to this anniversary. BEUC announces that it will present its 2020 consumer strategy in May of this year. 

Furthermore, BEUC's anniversary website draws attention to a particular consumer issue every month - February's 'topic of the month' is, indeed very topically, data protection.

Small world (II) - EU conference on data protection

In the context of the European Commission's plans for reforming the legal framework on data protection (on which we posted earlier), an EU-US conference is organised on 19 March 2012. More information can be found on the website of DG Justice, which states:

'The European Union recognises the protection of personal data as fundamental right; and the EU Treaties oblige the EU legislator to lay down a comprehensive set of rules. The EU is currently reviewing its legal framework on data protection; and this conference will contribute to reinforcing transatlantic dialogue at a time of concurrent policy and legislative initiatives in the EU and US. It will provide a forum for US and EU stakeholders from public and private sectors to obtain comprehensive, accurate and up-to-date information on EU data protection principles and the ongoing reform, and to discuss US and EU perspectives focusing on commercial privacy. The conference will also take stock of the operation of the EU-US Safe Harbour agreement and discuss issues regarding its further development.'

The conference will be held simultaneously in Washington DC and Brussels (via video conference link). A web cast will be made available, both live and after the conference.

Small world

For those of you who enjoy academic tourism, some interesting events are coming up relating to European consumer law. These include:

International conference
'European and national consumer law: what's new?'

1-2 March, University of La Rioja, Spain

International conference

'Consumer rights: The first fifty years'

15 March, University of Utrecht, the Netherlands

Secola conference
'Principles and specific rules in European contract law'

1-2 June, Messina, Italy

and, already next week, a symposium (in Dutch) on the Common European Sales Law (CESL)

29 February, Amsterdam, the Netherlands.

More news on other upcoming conferences on the proposal for a CESL will follow shortly. For an informative summary of an international conference on this topic that took place in Trier, I refer to Eric Clive's post on the Edinburgh 'European Private Law News' blog.

Human rights in business

This week, the European Commission's DG for Enterprise and Industry announced that it has selected three business sectors for a year-long project aimed at developing sector-specific guidance on the corporate responsibility to respect human rights. One of them is the ICT sector. The Commission indicates that:

'The guidance developed through this project will be based on the UN Guiding Principles on Business and Human Rights. The European Commission identified the development of sector-specific guidance as one of the priority actions in its recent communication on corporate social responsibility.

Extensive consultations with enterprises and all concerned stakeholder groups are planned as part of the project process. Shift and IHRB will coordinate this process on behalf of the European Commission. The development of the guidance is due to be completed by the end of 2012.'

From a private law perspective, it will be interesting to see whether the human rights guidance that is expected to result from this project will consider the development of private law remedies for consumers, employees and third parties (e.g. liability under contract or tort law) alongside voluntary commitment to human rights standards by ICT businesses. Insofar as internet users are concerned, the recent proposal for a General Data Protection Regulation (on which we posted earlier) might serve as an example, since its Article 77 establishes a right to compensation for damage from a controller or processor who infringes data protection law.

Finally, here is some recommended further reading...
...on the history of human rights: 'The last Utopia' by Samuel Moyn
...on human rights and EU-based businesses: Alexandra Gatto's book on 'Multinational enterprises and human rights'
...on contract law and human rights (for those of you who read Dutch and from this group especially those reading this on an Apple computer): a news paper article by Lyn Tjon Soei Len.

Money back guaranteed regardless the reason for travel organiser's insolvency - CJEU in Blödel-Pawlik (C-134/11)

16 February 2012: CJEU judgement in Blödel-Pawlik case (C-134/11)

Imagine you book a package travel for you and your partner. Before you trip commences, you receive a notice from the travel agency that they are declaring insolvency. What happens then? According to Art. 7 of the Package Travel Directive you should have no problem getting your money back, since the travel agency needs to be insured against insolvency.

This wasn't so easy for Mr Blödel-Pawlik. Even though the travel agency he used took out insurance against insolvency and provided him with two notices of guarantee, confirming that the cost of the trip would be refunded if the travel agency became insolvent, he still had problems with getting reimbursed. The reason for this was that it was clear that the travel agency never really intended to organise the trip in question. It was fraudulent conduct on its part to offer organisation of this trip for which the insurance company did not want to take responsibility towards consumers. The question asked to the CJEU was whether Art. 7 of the Package Travel Directive should be interpreted as intending to protect consumers also against fraudulent intent of travel organisers.

The CJEU answered: yes. The purpose of Art. 7 is to protect consumers against the financial risks arising from the insolvency of package travel organisers, which means that the refund of consumer's money has to be guaranteed. (Par. 19-20) There is no extra condition added to the provision of Art. 7 as far as the reason for travel organiser's insolvency is concerned. (Par. 21) This means that:

"facts such as imprudent conduct on the part of the travel organiser or the occurrence of exceptional or unforeseeable events cannot constitute an obstacle to the refund of money paid over or to the repatriation of consumers under Article 7 of Directive 90/314" (Par. 23)