Monday, 24 February 2020

Cancellation of connecting flights: whom to sue and where? Case C-606/19 flightright

On 13 February the Court of Justice delivered an order in case C-606/19 flightright concerning jurisdiction over the claim for compensation brought against an air carrier in charge of the final leg of the journey divided into several legs, confirmed in a single booking.

The case involved two passengers who booked a journey from Hamburg (Germany) to San Sebastian (Spain) via London and Madrid, comprising of connecting flights operated by different carriers. The problem faced by the passengers was cancellation of the third flight of the journey, operated by Iberia. The question to be addressed was whether a claim against Iberia could be brought before the court in Hamburg. Pursuant to Article 7(1)(a) of Regulation No 1215/2012 (Brussels I bis) in matters relating to a contract, a person domiciled in a Member State may be sued in another Member State in the courts for the place of performance of the obligation in question. The subsequent provision explains that in the case of the provision of services the place of performance of the obligation in question is generally the place in a Member State where, under the contract, the services were provided or should have been provided.

It was already clear from the previous case law that both the place of departure and that of arrival must be considered as the principal places of the provision of services under a contract for carriage by air, which in turn gives the person bringing a claim for compensation on the basis of Regulation No 261/2004 a choice of jurisdiction. This is the case for both direct flights and, mutatis mutandis, situations in which the journey with connecting flights consisting of a confirmed single booking for the entire journey comprises two legs. In the latter case, the passenger can also choose to bring the claim before the court or tribunal which has territorial jurisdiction over the place of departure of the first leg or one having jurisdiction over the place of arrival of the second leg.

The present case dealt with a similar legal matter yet with relation to a multi-leg flight, operated by different carriers. According to the Court none of this affected the procedural position of the passenger experiencing a cancellation or delay. First of all, the Court stressed that a contract for carriage by air consists of a confirmed single booking for a three-leg journey establishes the obligation for an air carrier to carry a passenger from a point A to a point D. The place of performance, within the meaning Article 7(1) of Regulation No 1215/2012, can therefore be the place of departure of the first leg of the journey (point A).

What is more, the rule of special jurisdiction for matters relating to a contract set out in that provision does not require the conclusion of a contract between two persons, but the existence of a legal obligation freely consented to by one person in respect of another on which the claimant’s action is based.  This is the case for an air carrier performing obligations under Passenger Rights Regulation No 261/2004 on behalf of another carrier having a contract with a passenger, in line with Article 3(5) of that regulation. Consequently, even though there were no complications on the first leg of the trip and the Hamburg-London flight was not operated by Iberia, the claim against the carrier could be brought in the Hamburg court.


Friday, 21 February 2020

‘Paying’ with personal data – what rights do consumers have?

The recently approved Directive on the modernization of consumer protection rules (available here) explicitly extended the scope of the Consumer Rights Directive to contracts where the consumer ‘pays’ with data, or contracts where the consumer provides personal data in exchange for a digital content product or a digital service. This extension means that consumers who ‘pay’ with their personal data have specific information rights stemming from Article 6 and the new Article 6a of the Consumer Rights Directive, such as the right to get information on the possibility of recourse to a complaint mechanism. Furthermore, these consumers are now entitled to the right to withdraw from the contract, even if they do not pay a monetary price. The advantage of this right when it comes to contracts where consumers ‘pay’ with data is evidently more limited than when consumers pays with money. Nevertheless, this is the latest move by the EU to better protect consumers’ personal data.

In fact, the Digital Content Directive (also recently approved and available here) was the first to 'innovate' in this area, by acknowledging the need for consumer protection in contracts where the consumer ‘pays’ with data. The Digital Content Directive extended the remedies already provided by the Consumer Sales Directive (applicable to the sale of goods and now replaced by the Sale of Goods Directive) to digital content contracts, both where the consumer pays a monetary price and where the consumer ‘pays’ with personal data. According to Article 14, in case of lack of conformity, consumers who provide their personal data in exchange for a digital content product or a digital service are entitled to have the product or service brought into conformity (for example, through an update). Furthermore, consumers are entitled to terminate the contract in case of any lack of conformity (regardless of how minor). In case of termination, the rights in the GDPR must be respected, particularly when it comes to the right to be forgotten (Article 17 GDPR) and the right to data portability (Article 20 GDPR).  

The increasing efforts by the EU to protect the consumer who ‘pays’ with data are an acknowledgement of the importance that similar data-based business models will play in the contracts of the future. However, the treatment of personal data as a contractual counter-performance is not uncontroversial. For example, although the (previous) European Data Protection Supervisor welcomed the protection of data subjects through consumer law, the EDPS also vocally opposed the treatment of data as a counter-performance. Nevertheless, given the increase in the number of contracts concluded in exchange of (personal) data (think of Spotify, Facebook and other similar platforms that provide digital services), it seems important to develop (and adjust) a general contract law framework applicable to these contracts. This must be done alongside – and not in opposition to – the data protection framework.


Monday, 17 February 2020

500 online businesses do not comply with consumer rights

Recently, the European Commission released the results of a screening (or ‘sweep’) of 481 retail e-shops (press release available here). The main finding was that more than 2/3 of the screened online businesses do not comply with EU consumer rights legislation (particularly the Consumer Rights Directive). This number means that consumers are not properly informed on their rights in 2 out of 3 shops.  

Article 6 of the Consumer Rights Directive establishes that in distance contracts consumers should be given a long list of information, including on the withdrawal right, on the legal guarantee and on the total price of the product. Furthermore – and most importantly -, this information must be given in a clear and comprehensible manner. However, according to the screening, more than 1/4 of the analyzed websites did not inform consumers about how to withdraw from a contract. This breaches Article 6(1)(h) of the Consumer Rights Directive. Furthermore, nearly 1/2 of the analyzed websites did not provide such information in a clear manner (particularly regarding the 14 days’ time limit). This breaches Article 6(1) of the Consumer Rights Directive. The failure to inform the consumer about the right to withdrawal is ‘punished’ by the Consumer Rights Directive with an extension of the period of withdrawal from 14 days to 14 days and 12 months (Article 10(1)).

The sweep also found a frequent breach of the pre-contractual duty to inform on the total price of the purchase. In fact, in over 1/5 of the consulted websites the price initially shown did not include additional charges such as delivery or postal charges. This breaches Article 6(1)(e) of the Consumer Rights Directive. Other findings show that over 1/3 of the analyzed businesses did not inform consumers about the 2-year legal guarantee to have a good repaired, replaced or reimbursed in case of a defect at the moment of delivery. This breaches Article 6(1)(l) of the Consumer Rights Directive.

The lack of adequate pre-contractual information is one of the biggest challenges faced by consumers, and one that the EU legislator has spent quite some time working on. Of course, one of the main problems of the information paradigm in EU consumer law is its lack of enforceability. Even though businesses often breach their duty to provide information in a clear way, it is (ironically) unclear what the legal and practical consequences for such a breach are. The Commission, however, promises an ‘in-depth investigation of the above-mentioned irregularities’ at national level and the subsequent request for traders to correct and improve the information they provide to consumers.

Tuesday, 4 February 2020

From the news: Amazon and unsolicited shippings

As sustainable - and unsustainable! - consumption becomes increasingly topical in consumer law and policy, news from the UK suggest Amazon is not ready to change their game to face their responsibility viz the climate emergency. Incidentally, in doing so they also provide quite bad consumer service. 

What is the story? According to reporting by the Guardian, Amazon uk has more than once been in controversies with customers over unsolicited deliveries. While some mistakes can happen when a company arranges millions of shipments per year, several customers have been met by refusal when asking Amazon to take back what had been wrongly delivered - with the company suggesting that the consumers simply dispose of the (new, perfectly functioning) goods. 

In the latest news item, the mistaken delivery concerned an excercise bike weighting 28 kilos. An elderly customer from Bristol received the bike after having ordered a completely different product. 

"After finding his way through the maze of the Amazon website he says he eventually found a number to call where a very helpful person agreed to replace his missing logs. But when these arrived the second driver also refused to take the bike away." 
When Amazon instructed him to dispose of the particularly bulky good as he liked, the customer approached the Guardian. Amazon changed their mind after the newspaper got involved, accepting to take back the bike and sending amenities to the puzzled customer.

The company's original reply is broadly in line with article 28 of the Consumer Rights Directive - providing that in case of unsolicited supply of goods or services consumers are not required to pay (but, the rule implies, may keep what has been delivered). However, in case of numerous wrong deliveries or bulky items such as a training bike, inviting consumers to dispose of the good is both highly questionable in terms of sustainability and oblivious of consumer interest. As the Bristol consumer observes in the Guardian article, if he was instructed to keep the bike, this likely means that another customer, who had originally ordered the bike, was probably delivered another widget. 

Can we really not do better than this?






Sunday, 2 February 2020

Data protection (violations) by default: stakeholder views and new developments in enforcement

Last weeks brought some interesting new developments in the implementation of the EU rules on data protection, such as the conditions for a valid consent to the processing of personal data and the principles of data protection by design and by default. As we observed numerously on this blog, the developments in data protection are of direct relevance to consumer law and policy, considering that business practices in the digital economy are often connected to the processing of consumer data and, as such, can come within the purview of both fields.

One of the major topic in the ongoing data protection debate concerns default settings. As readers may recall, several months ago we reported on the judgment of the Court of Justice in case C-673/17 Planet49 (CJEU confirms stricter requirements for valid cookie consent...). The case confirmed that - just like in the GDPR - consent referred to in Articles 2(f) and 5(3) of the E-Privacy Directive cannot validly be obtained by way of a pre-ticked checkbox, which the user must deselect to refuse his or her consent. 

Pre-ticked checkboxes and similar mechanisms of collecting consumers' "consent" by default are unfortunately still very present in the digital market. Furthermore, by applying the so-called dark patterns businesses can steer consumer behaviours in the direction they desire, even without the use of default settings (for an illustration see: Google tracks every step you take). Fortunately, practices of this kind not only attract attention of consumer organisations, but are also gradually engaged with by the law enforcers. Last week a higher regional court in Germany - Kammergericht Berlin - ruled on the case brought against Facebook by the national association of consumer organisations (vzbv). The case concerned a total of 26 alleged violations of consumer and data protection law, many of which were confirmed by the court. Default "consent" to location tracking, sharing a link to the users’ profile with search engines and the use of name and profile picture for commercial purposes have all been found to violate the applicable rules on data protection. By contrast, Facebook’s marketing claims that its services "are free and always will be" have not been considered misleading under national provisions implementing the UCPD.

On the latter point, one which turns around the question whether or not personal data constitutes a price, the emerging court practice is not entirely coherent. Just two weeks before the Berlin ruling, the Administrative Court in Lazio (Tribunale Amministrativo Regionale) partially upheld the decision of the Italian Competition and Market Authority (Autorità Garante della Concorrenza e del Mercato, AGCM) which considered an analogous slogan, directed at Italian users, to qualify as an unfair commercial practice. The AGCM has meanwhile launched proceedings against Facebook for the company's non-compliance with the prior decision.

All of this comes at a time of a broader discussion about the interplay of data protection law and consumer law and the application of the - often broadly framed - provisions of both the GDPR and the UCPD. A certain convergence of views appears to be forming between consumer organisations and data protection bodies, even if the relevant overlap is not always complete. It seems that consumer organisations are willing to accept the economic role of data whenever it is beneficial to consumers (like in the case of potentially misleading "free" claims). The European Data Protection Supervisor, however, has been arguing against any direct analogies between data and price, as illustrated by his position on the recent modernisation of the EU consumer rules (and previously on the digital content directive). When it comes to the data protection by design and by default the alignment between the two stakeholder groups seems even stronger. Last November the European Data Protection Board published Guidelines 4/2019 on Article 25 GDPR, which have largely been supported by the association of European consumer organisations - BEUC. The organisation welcomes the operationalisation of both principles, including through the proposed selection of performance indicators as well as the illustrative case studies. Nonetheless, the achievement of effective protection of consumer data in the digital economy has still a long way to go. Limited personal scope of Article 25 GDPR, which only imposes an obligation on controllers, and the lack of clarity on the role and responsibility of developers/processors have been mentioned as the major gaps to be filled.

Tuesday, 28 January 2020

BEUC’s 7 recommendations for post-Brexit positive consumer protection


With Brexit finally approaching, the questions surrounding the legal uncertainty that will most likely follow the UK's departure from the EU are louder than ever. BEUC issued a position paper containing seven recommendations to secure positive outcomes for consumers after Brexit (found here). These seven recommendations are intended for the regulatory actors, not consumers themselves. In short, BEUC argues for a close cooperation between the EU and the UK (including the creation of joint surveillance bodies), as well as for the maintenance of the existing level of consumer protection. The seven recommendations are the following (as summarized by BEUC):

1. Inform consumers about what Brexit means for them
BEUC defends that the first step to take is to inform consumers about any changes that their rights will suffer. BEUC suggests preparing concrete guidance documents such as factsheets.

2. Protect consumers when implementing the withdrawal agreement
BEUC highlights the need to maintain current levels of consumer protection when implementing the withdrawal agreement, namely consumer safety when it comes to imported goods. In fact, BEUC reminds that UK customs will be required to ensure compliance of imported products with both UK law and EU law (particularly when it comes to imported products arriving in Northern Ireland and considered "at risk" of entering the EU market). For this, UK customs will need trained staff. Furthermore, BEUC considers that EU authorities will need additional financial and human means to oversee the controls that UK customs will perform. Finally, BEUC stresses that the role of the joint committee of the withdrawal agreement will be essential, given that it will define the criteria according to which goods are at risk of entering the EU market via Northern Ireland.

3. Make consumer protection a key objective of the future relationship
BEUC recommends that there is a chapter dedicated to consumer protection in the withdrawal agreement (which could look like this). The level of consumer protection should not be reduced, to encourage trade and investment in the UK. The level of protection of consumers' privacy and personal data should also remain high, and the EU should explore the possibility of an adequacy decision. BEUC mentions six points that the chapter should contain: i) affordable access to telecommunications for consumers who are traveling or communicating with other countries should be preserved; ii) the security of an affordable energy supply should be protected (namely the integrity of the single electricity market between Ireland and Northern Ireland should be renewed); iii) unjustified geoblocking should be eliminated; iv) access to affordable flights should be ensured; v) consumers should be properly informed about their rights; vi) consumers should have access to redress and online dispute resolution mechanisms.

4.  Ensure consumer choice of goods and services
In addition to the concerns expressed in point 2 regarding the import of safe products, BEUC recommends a baseline of zero tariffs and quotas to avoid that consumers are hit by unexpected high custom duties.

5. Maintain regulatory dialogues to preserve consumer safeguards
BEUC suggests the creation (or maintenance) of regulatory cooperation mechanisms, operating on a voluntary basis, to guarantee the surveillance of the market. These cooperation mechanisms should cover enforcement of consumer rights. Moreover, the UK and the EU should avoid a race to the bottom when it comes to the regulation of competition.

6. Assess the impacts on consumers
BEUC suggests a comprehensive qualitative and quantitative analysis of the effects of a future agreement on consumers.

7.  Involve consumer organizations and be transparent
BEUC states that the "level of transparency provided by the EU during the Brexit negotiations was unprecedented" and that the same level of transparency is expected in the future (also of the UK government). This requires consumer organizations to have access to consolidated negotiated texts, in order to provide recommendations and to inform consumers. To this end, BEUC recommends the creation of an EU-UK trade advisory group.

Wednesday, 22 January 2020

Volkswagen hit by a multi-million fine from the Polish consumer protection authority

Last September we informed our readers about an interesting report from BEUC summarizing the developments in law enforcement following the Dieselgate scandal. Last week a fine of over PLN 120 million (approx. EUR 28 million), imposed on Volkswagen Group Polska by the President of the Office of Competition and Consumer Protection in Poland (UOKiK), was added to this list. The violations established by the decision (the operative part is available in Polish here) are anchored in the Polish provisions implementing Directive 2005/29/EC on unfair commercial practices (UCPD), specifically Art. 4(1), Art. 5(1), Art. 5(3)(2) of the Act on counteracting unfair market practices (Ustawa o przeciwdziałaniu nieuczciwym praktykom rynkowym). These correspond, respectively, with: the general clause on unfair commercial practices, the specific provision on misleading actions, specification on misleading actions related to the main characteristics of the product.

According to the press release, the President of the UOKiK contested following behaviours of the trader: disseminating false information in advertising materials which suggested that Volkswagen, Seat, Skoda and Audi cars were environmentally-friendly and met the requirements for nitrogen oxide emissions; providing incorrect nitrogen oxides emission parameters in EC certificates of conformity; issuing guidelines for sellers of these cars which suggested that consumers' complaints should not be taken into account. 

Besides imposing a fine, the President of the UOKiK also obliged the trader to send a letter to the affected consumers and publish the content of the decision on its website. VW can appeal the decision to the Court of Competition and Consumer Protection (SOKiK) in Warsaw.

Tuesday, 21 January 2020

Ex officio unfairness assessment limited to contractual clauses connected to the dispute – Opinion of AG Tanchev in Case C‑511/17 Unicredit Bank Hungary


On the 19th of December 2019, AG Tanchev delivered an Opinion on Case C-511/17 (found here), which deals with the scope of the obligation to assess the unfairness of contractual terms ex officio, under Directive 93/13/EEC (Unfair Terms Directive). As AG Tanchev starts by noting, this case is related to other cases on the Hungarian framework on consumer credit agreements denominated in a foreign currency (for example, Sziber C‑483/16, OTP Bank and OTP Faktoring C‑51/17 and Dunai C‑118/17).

The ex officio obligation in question is well established in the CJEU’s case law. This obligation is aimed at ensuring an effective protection of the consumer under the Unfair Terms Directive and it intends to restore the balance between the consumer and the professional party (see, for example, OTP Bank and OTP Faktoring C‑51/17 and Pannon GSM C243/08). As the AG acknowledges, the interpretative framework of the obligation to assess unfairness of contractual terms ex officio affects the civil procedure principle that the subject matter of an action is delimited by the parties and the court can go no further than that subject matter (ne ultra petita). In fact, the existence of this obligation means that under national procedural law the court must go beyond the object of the dispute as originally defined by the parties (para 44).

The main question raised in this case was, as summarized by the AG, whether a national court is required under Articles 6(1) and 7(1) of Directive 93/13 to examine ex officio the unfairness of all of the terms of the contract even if they are not necessary to decide on the parties’ claims in the dispute. In other words, the question underlying this case is whether that obligation should be unlimited and, if not, what the limits of that obligation are. Must all contractual terms be examined for unfairness based on the courts’ own motion?

To clarify, there are three different dimensions to this issue. First, whether national courts must only assess the unfairness of the terms invoked by the consumer or also the unfairness of other terms that the consumer did not invoke (ex officio). Second, whether the courts must take the whole contract into account when assessing the unfairness of the terms invoked. Third, whether there is an ex officio obligation regarding investigative measures, if the court does not have all the necessary elements to assess the unfairness of a term.

All the parties’ observations – as well as the AG’s – agreed that an unlimited obligation to assess the unfairness of contractual terms ex officio would largely (and unnecessarily) hinder fundamental principles of national procedural law. Illustratively, UniCredit Bank Hungary defended a triple criterion to limit the ex officio obligation: a national court must examine unfair terms ex officio only if i) the court has ‘the necessary legal and factual elements’ for that examination, ii) if the term concerned is relevant to the decision to be given and iii) if the term has a material and logical relationship with the case. In its statement, Hungary followed the same lines of reasoning, arguing that the court must examine ex officio ‘terms whose unfairness can be clearly established, as a matter of fact, on the basis of the available evidence’.

Following the same logic, the AG concludes that Articles 6(1) and 7(1) of the Unfair Terms Directive require national courts to assess ex officio the unfairness of contractual terms which are related to the object of the dispute and have a link with the legal or factual elements in the case file. This opinion suggests, therefore, a double criterion to limit the ex officio obligation to assess unfair terms: a relation between the clause and the object of the dispute and a link with existing legal or factual elements in the case. In other words, the courts’ obligation to assess ex officio the unfairness of contract terms does not extend to all contract terms, but only those with a link to the case in question. Consequently, AG Tanchev’s opinion is that national courts do not have to examine ex officio all the other contractual terms for unfairness, but merely to take all the other terms into account when examining the unfairness of a specific term, according to Article 4(1) of the Unfair Terms Directive.

This interpretation also means that it is not enough that the contractual term is relevant to the object of the dispute, but it is also necessary that the court possesses some legal and factual elements to determine the unfairness of the term. AG Tanchev also states that Articles 6(1) and 7(1) of Directive 93/13 allow national courts to ‘take ex officio investigative measures to complete the case file’ (e.g. asking for clarification or documentary evidence from the parties) in order to obtain the necessary legal and factual elements to carry out an ex officio examination of unfairness (para 55). The AG’s opinion follows the CJEU decision in VB Pénzügyi Lízing (C‑137/08). According to the AG, it appears that if the national courts do not have the necessary legal or factual elements, they are not obliged to assess the unfairness of the term, although they are able (but not obliged) to request those elements from the parties.

While this interpretation seems reasonable and it strikes a balance between fundamental principles of civil procedure law and EU consumer protection, this last argument regarding ex officio investigative measures is slightly more confusing than the previous ones. In fact, as the AG acknowledges, the CJEU has previously highlighted the need for ‘sufficient evidence’ in order to assess the unfairness of the contractual terms (para 62). The AG addresses this aspect by stating that ‘this may be viewed as lending support for the position that the national court has at its disposal sufficient legal and factual elements for the ex officio examination if necessary by being able to take ex officio investigative measures to that effect’. More clarification on this aspect in the final CJEU decision would be desirable.

Sunday, 19 January 2020

Ex officio control in European order-for-payment procedure

A case we have not reported yet on this blog but is certainly of interest in the light of several other cases on (national) expedited debt collection procedures - such as SalvoniProfi Credit and Addiko Bank - is Bondora (Joined Cases C-453/18 and C-494/18), a Spanish preliminary reference on ex officio control of unfair terms in the context of a European order-for-payment procedure. In short, the CJEU held that national courts can request from the creditor additional information relating to the terms of the agreement on which the claim is based. For a more extensive discussion of the case, we refer to this blog on ConflictofLaws.net.

Friday, 10 January 2020

No inertia selling in non-individually requested energy contracts - EVN Bulgaria Toplofikatsia and Toplofikatsia Sofia (joined cases C‑708/17 and C‑725/17)

Facts

Joined Cases C‑708/17 and C‑725/17 (delivered on the 5th of December 2019 and found here) deal with owners of apartments in a building in co-ownership. In both cases, there is a contract for the supply of thermal energy concluded between the majority of the owners of the building and an energy supplier (EVN Bulgaria Toplofikatsia and Toplofikatsia Sofia, respectively). Also in both cases, the energy companies sent to the individual co-owners (Ms Dimitrova and Mr Dimitrov, respectively) a bill for energy consumption costs. The co-owners in question alleged that there is no contractual obligation between them and the respective energy companies since they did not individually request the supply of thermal energy, according to the prohibition of inertia selling of Directive 2011/83/EU and of Directive 2005/29/EC. Moreover, Ms Dimitrova and Mr Dimitrov argued that the consumption reflected on the bills did not reflect their actual energy consumption, which would breach Article 13(2) of Directive 2006/32.

Legal issues

There are two relevant issues from a EU consumer contract law perspective: first, whether there is inertia selling in the case of lack of individual request of energy supply; second, whether the co-owners of a building are consumers. Moreover, from a EU consumer energy law perspective, the case determines whether the bills for the consumption of thermal energy can be calculated in proportion to the heated volume of each owner’s apartment. This case is also interesting because it addresses the relationship between EU consumer law and national contract law.

CJEU’s decision

The CJEU started by determining the applicability of the Consumer Rights Directive. In this case, there is a contract concluded between the thermal energy providers and, according to Bulgarian law, the owners of a building in co-ownership. The question was whether the owners of the building can be considered consumers. Following AG Saugmandsgaard Øe’s opinion, the CJEU answered this question in a brief and evident manner: as long as the owners are not involved in commercial or professional activities, they are consumers within the meaning of Article 2(1) of the Consumer Rights Directive.

Then, the CJEU dealt with inertia selling. Inertia selling has been defined in the CJEU’s case law as a ‘conduct whereby the trader demands payment from a consumer for a product or service which has been provided to that consumer without the consumer soliciting it’ (Wind Tre and Vodafone Italia, C‑54/17 and C‑55/17). Inertia selling is considered an unfair commercial practice under Article 5 and under point 29 of Annex I of the Unfair Commercial Practices Directive. In addition, inertia selling is prohibited by Article 27 of the Consumer Rights Directive. The notion of inertia selling revolves around the concept of solicitation as the act of asking for a service or a good to be provided to the consumer. Therefore, to discuss whether this is a case of inertia selling, the CJEU had to discuss the notion of consent. In fact, the question is whether Mr and Mrs Dimitrova consented to the contract, considering that they did not individually agree to it, but that the majority of co-owners as a group decided it. In other words, when can we consider that a consumer ‘solicited’ a service?

The CJEU highlighted that aspects regarding consent and the formation of the contract are determined by national law, as is acknowledged by Recital 14 and Article 3(5) of the Consumer Rights Directive. Bulgarian energy law provides that the energy installations in a building in co-ownership follow from the written consent of (at least) two-thirds of the owners of the building. Therefore, the energy service appears to also have been solicited by the co-owners in question, since the rules on contractual consent are defined by national legislation. Article 27 of the Consumer Rights Directive states that ‘the absence of a response from the consumer following such an unsolicited supply or provision shall not constitute consent’. Taking Bulgarian law into account, the CJEU determined there was no unsolicited supply of thermal energy in the terms of Article 27 of the Consumer Rights Directive. It is noteworthy that, as the Court implied, the consent necessary to have a ‘solicited’ energy supply can be found in the co-owners’ agreement to be subject ‘to all (…) the decisions adopted by the general meeting of the owners of property in that building’. As a consequence, the CJEU concluded that the Consumer Rights Directive and the Unfair Commercial Practices Directive do not preclude a national law that requires co-owners to pay for energy bills regarding a contract that they did not individually request (and did not use). The take-home message is that the mere lack of individual consent for the supply of a service does not automatically mean that there will be inertia selling under EU consumer law.


Finally, the defendants claimed that to calculate the bills for consumption of thermal energy proportionally to the heated volume of the apartment instead of based on actual consumption goes against Directive 2006/32 and Directive 2012/27. However, both the AG and the CJEU concluded that a law that allows for such a method of bill calculation does not violate EU law, considering that the above-mentioned Directives give the Member States a wide discretion in what concerns the calculation method for billing for thermal energy consumption in buildings in co-ownership.