Added value for improving the enforcement of EU legislation – initial stage

The European Commission has just launched a public consultation aimed at achieving a coherent approach towards collective redress in the European Union.

Although collective redress is not a new concept in the EU, the Commission decided to launch a consultation “Towards a more coherent European approach to collective redress”.

What is the purpose? Mainly to identify common legal principles, is there a need for a future legal instrument and – last but not least - how these principles could fit into the EU as well as into the Member States legal systems. In other words, the Commission seeks opinions on the future for collective actions in Europe.

Sometimes the violation of EU law may trigger multiple individual lawsuits. Current EU law already provides for the possibility of pursuing collective actions for injunctions in the field of consumer law, but the national legal systems vary considerably concerning financial markets, competition, environmental protection, and other areas of law (what is more, some Member States have them, while others do not).

Generally speaking, there are two types of a “broad concept of collective redress”. That is: (i) injunctive relief (lawsuits seeking to stop illegal behavior) and (ii) compensatory relief (lawsuits seeking damages for the harm caused). Such procedures can take a variety of forms. To name a few: court actions, out-of-court settlements, ADR.

It is still a very initial stage and the outcome of the public consultation is open. Contributions can be sent until the end of April 2011.

Your personal data had been stolen online. Wouldn't you like to be notified about that?

There is more and more talk recently about European Commission needing to take more actions to make consumers more secure in the digital world that we are living in. (e.g. read an earlier post on cloud computing: here) We can see the European Commission expresses more interest in regulation of the digital content services or in review of Package Travel Directive which would accommodate consumers buying their holidays online (e.g. read earlier post: here). Moreover, recently it seems that the European Commission would consider harmonisation of European consumer law in Consumer Rights Directive a success if it only improved the confidence of consumers in online transactions (read earlier post: here).

One of the issues that the EU is still struggling against while trying to increase consumers confidence in concluding online transactions, is a problem of data privacy. Many consumers are wary as to the leaks and abuses that might (and do) happen online or the impossibility of deletion of data that had been once entered into the world wide web. In the review of ePrivacy Directive (2002/58/EC) it has been decided that a European data breach notification requirement should be introduced for the electronic communication sector in order to appease the consumers' worries.

The ENISA (European Network and Information Security Agency - the role of that agency is to improve network and information security in EU) had recently released a report in which it reviewed the current situation in order to develop a consistent set of guidelines addressing the technical implementation measures of the data breach notification requirement. It seems that nowadays most Member States have no system that would require the data breach notification to the consumers or to any agency that might protect consumers or the privacy of their data. One can hope that this will change soon due to the new European policy established in the EU Telecoms Reform in November 2009 which is to be implemented by May 2011 (more information on these new rules may be found here). The data breach notification requirement is set for notifying mainly the data protection authorities. However, in case the data breach affects personal data, then the affected consumers should be notified, as well. The ENISA report sets out, inter alia, under what circumstances the consumers should be notified. You may find that report here.

This compliments nicely the public consultation on the privacy of personal data that had just been concluded by the European Commission - which also had been previously mentioned on this blog, see: here.

Will Consumer Rights Directive harmonise 2 or 4 EU consumer directives? Come on, take a guess.

A few days ago I wrote (And then there were two...) about the Council's agreement on the new proposal for the Consumer Rights Directive. They reached consensus on harmonization of two currently binding European Directives on: Distance and Doorstep Selling.

Today, the Committee on the Internal Market and Consumer Protection of the European Parliament adopted in a vote it's own version of the future Consumer Rights Directive and they seemed to have included in it all four Directives that were originally reviewed (that is, together with the Consumer Sales Directive and Unfair Contract Terms Directive). Most members of the Committee of the European Parliament were convinced that the consumers should not only be protected in the same way across EU when they conclude online (or other distance or off-premises) contracts, which seemed to have dominated the debate in the past few months. The European Parliament might still want to aim at the same level of protection for consumers regardless whether they purchase a good in stores or online. Moreover, they intend for the Consumer Rights Directive to include a list of unfair contractual terms.

The European Parliament does not follow fully the recommendation of the European Commission by not choosing to adopt full harmonization. After so much criticism the idea of full harmonization had received it did not really come as a surprise that EP choosed for a mix of minimum (e.g. as to remedies for lack of conformity) and maximum harmonization (the last one as to: information requirements, delivery deadlines, right of withdrawal).

While the Parliament is expected to vote on the proposal of its own Committee in March in a plenary session, the action plot is getting thicker. What kind of substance is the Consumer Rights Directive going to end up with? Is anyone going to be happy with it?

More in the European Parliament's press release of yesterday.

Happy Data Protection Day!

(Un)acknowledged legislators

In celebration of today's Dutch poetry day, tomorrow's European data protection day and tomorrow's tomorrow's European contract law, here are some pages for

iConsumers: an eYou guide on digital rights

citizens, organisations and public authorities with an interest in European contract law: a possibility to take part in the public consultation on the Commission's green paper regarding this field (deadline Monday 31 January 2011!)

and other poets.

Viviane Reding on cloud computing and data protection

“Cloud computing conjures up images of floating zeroes and ones – data liberated from the desktop and drifting effortlessly from one server to the next.”

While this poetic line from Viviane Reding’s speech for tomorrow’s data protection day already makes a post on this blog worthwile, you may well be asking yourself what this ‘cloud computing’ is all about and what on earth it has to do with consumer law.

First of all: what is ‘cloud computing’? Cloud computing concerns online software which can be used by consumers and businesses without them having to install the software on their computers. Think of online data storage, but also of online network software such as LinkedIn or Facebook.

These programs are of great value to consumers and businesses, but also bring along risks concerning data protection (privacy as well as the risk of loss of data). The EU Data Protection Directive is running old (15 years) and so the Commission is announcing improvements in order to safeguard the consumer’s confidence in cloud computing services. Or, in the words of Reding: ‘A cloud without robust data protection is not the sort of cloud we need.’

For more beautiful poetry (as well as information on Reding’s proposals on cloud computing), click here and here.

Happy data protection day tomorrow!

[Picture: David Kleinert Photography]

Second chance for UK

While Sweden has been referred to the ECJ, the UK has received a second chance as far as the proper implementation of the Consumer Credit Directive 2008/48/EC is concerned.

The purpose of this Directive was to ensure that consumers can easily compare various credit offers available in all Member States, e.g. by setting out requirements on standard information to be provided when advertising unsecured lending services (Chapter II of the Diretive) or by harmonizing calculation of the Annual Percentage Rate of Change (APR - no idea what it means? check here) (Chapter V of the Directive).

The deadline for implementation of the Directive was set on 11 June 2010. The infringement procedure had been initiated last year already since UK has not communicated to the European Commission all measures implementing the Directive. Today UK has received two more months to comply with the European requirements. In two months European Commission may refer UK to the European Court of Justice.

Swedish dilemma

The European Commission referred Sweden to the European Court of Justice for inadequate transpotition of the Directive 2002/65/EC on the distance marketing of consumer financial services. This Directive offers consumers similar level of protection as the Distance Selling Directive, however, it applies to the marketing and sale of financial services (and not goods) via means of distance communication, e.g. when a consumer takes a loan from a bank via telephone, or signs up for a credit card online.

Sweden infringed consumer rights by e.g. leaving an option open to the service providers to require from consumers who are trying to use their right of withdrawal a compensation for costs associated with screening before consumers are granted a loan. According to Article 7 of this Directive consumers using a right of withdrawal may only be required to pay for services provided to them directly.

Since Sweden did not timely amend its legislation after first being notified by the European Commission of its infringement, the matter will now be directed to the ECJ. The reference procedure is one of the most important elements in protecting indvidual rights and insisting on adequate remedies for consumers that European Commission may use. The EC does not make use of it too hastly, but sometimes the national legislative authorities are just too slow in giving their citizens the necessary (European) standard of protection.

Consumers - patients

The European Parliament voted on 19 January in favor of the EU Directive on patients' rights in cross-border healthcare.

John Dalli, European Commissioner for Health and Consumer Policy, said it was an important step forward for all patients in Europe.

The Directive will benefit patients across Europe by clarifying their rights to access safe and good quality treatment across EU borders, and be reimbursed for it. Generally speaking, people prefer to receive their healthcare closer to home. No one wants to travel further than necessary when they are sick. However, sometimes the need for certain treatment leads patients to go abroad. Another reason could simply be that the nearest hospital lies across a border.

In addition to providing a clear and coherent set of rules on cross-border healthcare, this Directive will benefit patients in several other ways. It will help patients who need specialized treatment, for example those who are seeking a diagnosis or treatment for a rare disease. It will bring about closer and improved health cooperation, including the recognition of prescriptions, between Member States. Health experts across Europe will be able to exchange best practices and mutually benefit from innovations in health technology assessment and eHealth.

Is it fair?

The web page www.isitfair.eu contains practical information for consumers on how to check if they have fallen victim to an unfair commercial practice, and how to get help.

The burning question for consumers undoubtedly is: “How can I tell when a particular commercial practice is unfair?” The Unfair Commercial Practices Directive simplifies the answer to this question. Certain commercial practices are always prohibited under the Directive throughout the European Union while the legality of others can be determined by applying clear and common criteria.

First of all, certain commercial practices are always prohibited under the Directive. To ensure that traders, marketing professionals and customers are clear about what is banned, a black list of 31 unfair practices has been drawn up. The same list applies in all 27 Member States of the EU. The legality of a commercial practice that is not banned outright can be assessed by evaluating it against specific legal criteria. Two main categories of unfair commercial practices – "misleading" and "aggressive" – are described in detail in the Directive. The vast majority of practices which would be considered unfair fall under these provisions.