Proposal on Empowering Consumers for the Green Transition/Part 2

 Last week, I posted a summary of the main changes the Proposed directive for empowering consumers for the green transition would bring to the Unfair Commercial Practices Directive. Today's second part will be devoted to the Consumer Rights Directive. 

Next to preventing "greenwashing" and unsubstantiated claims, the Commission aims that consumers get the right information, that is information that allows to make them more sustainable choices - in particular choosing for more energy efficient, durable and reparable products. 

Six items are added to the pre-contractual information requirements, both for distance and off-premises contracts and for other transactions coming under the scope of the Directive. 

These six additional items concern guarantees, updates and repairs (including some complicated language about telling consumers what they have not received information on).  

–information on the existence and length, of a producer’s commercial guarantee of durability for all types of goods, when this information is made available by the producer; 

–information that no information has been provided by the producer about the existence of a producer’s guarantee of durability for energy-using goods;

–the existence and length of the period during which the producer commits to providing software updates for goods with digital elements;

–the existence and length of the period during which the provider commits to providing software updates for digital content and digital services; 

–the reparability score of the good as applicable under Union law; 

–other repair information, should no reparability score be available at Union level – such as information on the availability of spare parts and a repair manual.

The guarantee information, in particular, needs to be provided also in the context of contracts concluded with electronic means, before the consumer concludes the contract. This includes the possibly confusing "non-information" referred to above ("information that no information has been provided... about the existence of a producer's guarantee of durability"). The proposal explains that, for energy-using goods, providers also need to give information concerning durability when this can be easily and reliably calculated - so the "negative information" above means sellers would have to say something like "we make no promises as to the product's durability". The proposal explains that 

The problem of limited durability contrary to consumer expectations is most relevant for energy-using goods, which are goods that function from an external energy source. Consumers are also most interested in receiving information about the expected durability of this category of goods. For these reasons, only for this category of goods, consumers should be made aware that the information about the existence of a producer’s commercial guarantee of durability of more than two years has not been provided by the producer.

While the reasoning seems plausible, the text is particularly clumsy and could use a clarification/exemplifications.  Here's to the hope that it can be improved in the legislative process - form is substance, even in consumer law :). 

Finally, it is interesting to observe that the reference to an applicable reparability score is, so far, aspirational - no such European scheme exists, despite the warm reception of the French initiative which for the first time established such scoring in Europe (the so-called "indice de réparabilité"). In this respect, a petition has been launched months ago by the Greens, but I could find no official update connecting this reference in the proposal to actual legislative initiatives in the indicated directions. 

This is it for now - while normally information requirement may not be the most exciting of developments, the connected issues here, such as the reparability score and the fight against planned obsolescence all give us reason to think that there will be quite something to report on in the near future. Stay tuned!

Proposal on Empowering Consumers for the Green Transition/part 1

Last week, the Commission has presented a new proposal in the context of its Consumer agenda and circular economy action plan, the Proposal for a Directive on Empowering Consumers for the Green Transition. The proposal aims to empower consumers to play their role in the transition to a circular economy by providing them more information concerning key sustainability features of the products they buy and by clearing out misleading information – also known as greenwashing.  

The Directive has a relatively short text with only two main articles, amending respectively the Unfair Commercial Practices Directive (UCPD) and the Consumer Rights Directive (CRD) to add a few items. I will split the overview in two posts in order to avoid a text wall, so here we go with the first part: changes to the UCPD.

 

First off, the proposal adds a number of practices to the blacklist of practices that are always unfair under articles 6 and 7 UCPD. These include, in essence:

• Displaying sustainability labels which are not based on a certification scheme or established by public authorities;
• Unsubstantiated or inflated environmental claims, including when mandatory requirements are presented as distinctive features of the product;
• Omitting to inform consumers about planned obsolescence features or about the adverse impact certain updates may have on product functionality;
• Omitting to inform consumers of the limited reparability of a product or of the fact that the product is designed to limit its functionality when used in combination with non-original spare parts;
• Inducing the consumer to replace parts of a good earlier than necessary.  

Based on occasional news, it seems plausible that at least some of these practices were in fact already the target of national enforcement policies. More innovative is the opening to a broader meaning of “sustainability” in some of the provisions, which is explained in the recitals: “Information provided by traders on the social sustainability of products, such as working conditions, charity contributions or animal welfare, should not mislead consumers either.” Hence in the proposal’s article 1, 

‘sustainability label’ means any voluntary trust mark, quality mark or equivalent, either public or private, that aims to set apart and promote a product, a process or a business with reference to its environmental or social aspects or both. 

Comparably, “sustainability information tools” are defined as 

software, including a website, part of a website or an application, operated by or on behalf of a trader, which provides information to consumers about environmental or social aspects of products, or which compares products on those aspects;

Why does the Directive engage with such information tools?

 

According to the proposal, if a trader provides such tools, they would have to include “information about the method of comparison, the products which are the object of comparison and the suppliers of those products, as well as the measures in place to keep that information up to date”. All this information shall be considered “material information” to the ends of article 7 UCPD, meaning that failure to include it (in a way reasonably accessible to the consumer) will be considered a misleading omission. 

 

This is, given the state of real-world developments, perhaps a bit disappointing: in particular, it says nothing about more socially pressing omissions: should a seller who, for instance, has been made aware of terrible working conditions at their production sites not make mention of that on their website, at least when they hint in any way to their efforts (which doesn’t seem prohibited – “unsubstantiated environmental claims” would be forbidden but in the social compartment only made-up labels seem to be covered)? It may well be that some member states could read this requirement into the directive’s spirit since the proposal does not amend the general unfairness and misleading-ness tests. However, it would be even better if loopholes like this one would be addressed in the political process in the months to come.