Earlier this year in C-96/21 CTS Eventim the CJEU delivered another interesting judgment on the interpretation of Directive 2011/83/EU on Consumer Rights (CRD). As with most cases on CRD, this case tackles the matter of the right of withdrawal by providing an interpretation of Article 16(l) that exempts 'services related to leisure activities if the contract provides for a specific date or period of performance' from the right of withdrawal.
Facts
The consumer ordered tickets through an online booking platform
operated by CTS Eventim, an intermediary selling concert tickets organized by third parties. The concert that was due to take place in Germany was
cancelled because of German administrative restrictions amid the COVID-19 pandemic, with a possibility to be held at a
later date. In accordance with German legislation, CTS Eventim, acting on
behalf of the concert organizer, sent the consumer a voucher in the value of
the ticket price. The consumer however asked CTS Eventim for reimbursement
of the ticket price and costs incurred and thus, according to the referring
court, implicitly asked to withdraw from the contract.
Question
The question referred to the CJEU was: Would a situation where the trader (an intermediary acting in its name and on behalf of the organizer of the leisure activity) does not directly provide the consumer with a service related to leisure activity but sells the consumer a right of access to such service fall under the exception of Article 16(l)?
Ruling
The CJEU noted that the contract for the transfer of a right falls within the concept of a ‘service contract’ under Article 2(6) CRD, and insofar as Article 16(l) covers all services provided in the leisure sector, due to the word ‘related’, the provision is not limited solely to services directly relating to the pursuit of leisure activity (para 38). The transfer of a right of access to a leisure activity constitutes, in itself, a service related to a leisure activity (para 39). In this regard, it is irrelevant that a service is provided by the intermediary and not by the organizer of a leisure activity itself (para 43).
However, CJEU looked
at the objective of Article 16(l), and referring to Recital 49
noted that the objective is to protect traders against the risk associated with
the setting aside of some capacity which, if a right of withdrawal were
exercised, the trader may find difficult to fill, inter alia, in the case of
cultural or sporting events (para 44); and referred to its previous case-law
where it was established that the aim of Article 16(l) is to protect the interest
of the providers of certain services against disproportionately suffering from
consequences of the right of withdrawal (para. 45). The CJEU concluded that as
long as the risk falls on the organizer of the activity, the
transfer of a right of access to that activity by an intermediary will constitute a
service related to that activity. It
is irrelevant whether, on the date on which the consumer invokes the right of
withdrawal, it is possible for the trader to fill in the empty capacity, in
particular by means of the resale of the ticket. ‘The application of
Article 16(l) of Directive 2011/83 cannot depend on such an assessment of
the circumstances of each case' (para 48).
The CJEU also considered the second part of the exemption and concluded
that a contract for the transfer of a right of access to a leisure
activity must be regarded as providing for a specific date or period of
performance since that activity is scheduled to take place on a specific date
or within a specific period (para 53).
The CJEU concluded that the exception from the right of withdrawal may be relied on
against the consumer, if, first, the termination of the obligation to
perform that contract vis-à-vis the consumer by means of withdrawal would place
the risk linked to the setting aside of the capacity thus released on the
organizer of the activity concerned and, second, the leisure activity to which
that right gives access is scheduled to take place on a specific date or within
a specific period.
Further thoughts
This case provides an important interpretation of the CRD in distance contracts concluded via intermediaries, given that the CRD is silent on regulating contracts concluded via intermediaries.
The CJEU provides a good explanation of the rationale for the exception. It is expected of traders, not of intermediaries, to fill in capacities that are created by the right of withdrawal, e.g. resell the ticket that is for a specific date to avoid loss.
The CJEU also provides substantiated reasoning why the exception should apply in the same way when contracts are concluded directly with service providers and indirectly, with intermediaries. The rule does not change whether or not the ticket is sold by an intermediary or the direct service provider, as long as the risk is born by the direct service provider, in this case, the organiser of the concert.
However, the present case does not give full guidance on how Article 16(l) CRD should apply in other, similar settings. The present case defines intermediaries as those acting in their own name but on behalf of their principal. Given the emphasis of the risk being on the organiser of the event, the same solution would probably apply with intermediaries acting in the name and on behalf of their principal. However, the situation is less clear when the risk is not on the direct service provider, the organiser of the event, but on the online seller who sells tickets via its website. This would occur in a situation when the tickets are bought for resell. Although in this case online sellers would probably not be classified as intermediaries in law, from a consumer's point of view, there may be confusion and the two kinds of sellers might be considered to both be intermediaries. For instance, consumers would consider Skyscanner an intermediary whereas it is a travel agent. We could argue that the regime should again be the same because the rationale for the exemption seems to be the inability of traders to fill in the capacities that are created by the right of withdrawal. For example, just like organisers, intermediaries might struggle to resell tickets for a particular date and as a result, suffer loss. Overall though, this interpretation cannot easily be deducted from the reasoning in the present case.
Since this case and the earlier Tiketa C-536/20 case, the case law seems to move in a direction of considering including intermediaries within the scope of CRD; in the next case on this topic, the CJEU should take the opportunity to express views on the classification of various (intermediary) sellers and the legal regime(s) applicable to them.
