Roam like at home default for all - CJEU in C-539/19

Dear readers, 

as you may have suspected already, the CJEU went back in session this past week and delivered a good number of judgments and opinions of interest to consumer law aficionados. While other cases may deserve complex scrutiny, hereby a short notice on a less complicated, but still somewhat impactful, decision: Verbraucherzentrale Bundesverband v Telefónica Germany.

The case concerns the interpretation of Regulation 2015/ which introduced "Roam like at home" (RLAH) as the rule within Europe, effectively ending roaming charges in the EU for most telecom customers. Unlike other companies, Telefonica Germany (OZ) had not immediately transferred all its customers to a RLAH regime on the day (15 June 2017) the regime was supposed to enter into effect. In particular, customers who, prior to that date, had acquired a special roaming package with the company were not automatically transferred: instead, they were asked to opt in for RLAH - lacking such express action, their previous contractual conditions were kept in place. 

Offering specific roaming packages tailoring to the needs of particular groups of consumers is allowed after 15 June 2017 under art 6e(3) of the regulation, providing that  roaming providers may offer, and roaming customers may deliberately choose, a roaming tariff other than the one offered under RLAH terms. 

In practice, Telefonica maintained that an invite to customers to opt in RLAH was enough to guarantee that staying with the alternative tariff was a deliberate choice as required by the provision; the Verbraucherzentrale disagreed and the CJEU concurred in such disagreement. 

The court considered the possible advantages and disadvantages of opt-in and opt-out for introducing RLAH and concluded that nothing - from the letter of the regulation to the intention of abolishing roaming charges - could be read to suggest an interpretation of deliberately not requiring RLAH to be the default option in case of consumer inaction. 

The fact that no AG opinion was submitted on this case suggests not many sleepless nights were required to reach this conclusion, which may or may not open a complicated file for Telefonica: since the original proceedings were an injunction against the company's implementation of the Regulation, it is unclear whether other remedies will be sought. 

ECJ in Orange Polska: Signing a contract in the presence of a courier is not an aggressive practice

On 12th June the CJEU issued its judgement on the Orange Polska case (C‑628/17) on the meaning of the aggressive practices provisions in the Unfair Commercial Practices Directive. This blog previously reported on the AG opinion on the case. The facts of the case will be summarised here, but they are analysed in greater detail in that post. 

The referring court asked whether the practice in question, where in order to conclude a telecommunication contract the consumer has to make the final decision in the presence of the courier employee who is handing him the contract terms, should be considered an aggressive practice with the use of undue influence, according to art. 8 and 9 UCPD.

The Court draws attention to the fact that the context of each individual case needs to be taken into account for determining the existence of a practice that uses harassment, coercion or undue influence (paras 30-31). This case-by-case factual analysis seems to be necessary only for aggressive practices, rather than all kinds of unfair practices.

The Court goes on to clarify that only undue influence is relevant in this particular case (para 32). However, the wording of articles 8 and 9 UCPD doe snot appear to demand identifying whether a practice is aggressive due to the use of harassment, coercion or undue influence.Making reference to point 45 of the AG Opinion the Court pointed out that undue influence is not necessarily impermissible influence but influence which, without prejudice to its lawfulness, actively entails, through the application of a certain degree of pressure, the forced conditioning of the consumer’s will.

Tne Court stated that the fact that the consumer was asked to sign a contract in the presence of a courier without having been sent the contract beforehand, but having had the chance to access it online, cannot be considered an aggressive practice (para 40) on its own.In assessing whether the consumer actually had a chance to receive information prior to the courier's visit, the quality of information plays an important role. The mode of communication is key as the information provided on a trader's website may be superior to that included in a phone conversation (para 42). Still, while more detailed information may be available on line, one could argue that over the phone, consumers may be able to focus on the the questions more relevant for them.

The Court is taking a restrictive view on what can amount to an aggressive practice, as it is pointed out that even if a consumer did not have the chance to access the information beforehand, that is not enough to classify it as an aggressive practice (para 43). Instead, the key criterion is the conduct of the trader. It is stated that conduct, such as the one in the case in question where the courier asks the consumer to take his final transactional decision without having time to study, at his convenience, the documents delivered to him by that courier, cannot constitute an aggressive commercial practice (para 45).

What is needed is something additional to the conduct above that would make the consumer feel uncomfortable and confuse his thinking in relation to the transactional decision at hand. Some examples of what might be considered aggressive includes:'the announcement that any delay in signing the contract or amendment would mean that the subsequent conclusion thereof would be possible only under less favourable conditions, or the fact that the consumer would risk having to pay contractual penalties or, in the event of the contract being amended, would risk the trader suspending the service'(para 48).

Another example was that of the courier informing the consumer that, if he refuses to sign or delays in signing the contract or amendment that has been delivered to him, he could receive an unfavourable assessment from his employer could also fall within that same category; an example similar to point 30 of Annex I of the UCPD, where a trader informs the consumer that if he does not buy the product, his job or livelihood will be in jeopardy.

Unfortunately, the opinion of the AG was not followed in this case and the Court was not daring enough in its interpretation of the aggressive practices provisions, as it was in Wind Tre, even though it was often cited in the judgement. Contrary to the AG opinion, the judgement does not engage at all with the average consumer standard. The judgement fails to provide a comprehensive mechanism for interpreting the provisions or indeed promote our understanding of what kind of pressure is the consumer expected to withstand. Instead, it repeats the phrasing of art.8 on making the consumer take a transactional decision he would not have taken otherwise. 

With this judgement the concept of aggressive practices is interpreted in a restrictive manner, in an effort to balance consumer protection with commercial realities, thus failing to make use of the potential of the provisions.

Un

New roaming rules in books and in action - several insights from Poland

How did this all come about?

Reduction of roaming surcharges in the EU is one of the European legislator's flagship projects, perceived as a much-needed positive signal in the times of growing euroscepticism. Indeed, against a background of continuous setbacks and crises, bringing down prices of foreign calls, text messages and data transfers within the EU appears to be a success story. The process began in 2007 with the adoption of Regulation 717/2007 introducing the so-called Eurotariff. Not surprisingly, even this rather modest regulatory intervention in the roaming market met with resistance from the telecom operators and was challenged before the Court of Justice. However, the effects were opposite to the ones intended: after the regulation was upheld by the CJEU, the European legislator felt encouraged to regulate the roaming prices even further. Over time, Regulation 717/2007 was substantially amended and eventually replaced with Regulation 531/2012 on roaming on public mobile communications networks within the Union, which also today is one of the key EU acts in this domain.

What brought the issue of roaming back on the front pages is the adoption of Regulation 2015/2120 in November 2015. The act introduced a number of amendments to Regulation 531/2012 and set as its aim the (almost) complete abolishment of retail roaming surcharges by 15 June 2017. 

Two further steps needed to be taken, however, before the objective set in new regulation could be reached:

• the adoption of implementing rules concerning possible limitations to the "roam like at home" principle, namely the so-called fair use policies and exceptional authorisations which telecom operators may obtain in order to apply a surcharge - the Commission Implementing Regulation 2016/2286 to that end was adopted on 15 December 2016, and
• the adoption of a further regulation imposing new caps on roaming charges in the wholesale market, i.e. prices which operators are charging from their foreign counterparts for using their networks. Unlike regulation 2016/2286, imposition of the lower wholesale caps had to be adopted in the ordinary legislative procedure pursuant to Art. 114 TFEU and thus required an interinstitutional agreement. As for now, everything seems to indicate that also this last hurdle will soon be overcome. The Commission tabled the respective proposal in June 2016 and after approx. 6 months, on 31 January 2017, a provisional agreement between the Council and the European Parliament was reached. The EP voted on the regulation in its April session and the Council is expected to follow suit very soon.

What are the new rules...

Following the recent reform, Article 6a was added to Regulation 531/2012, which reads as follows: 

With effect from 15 June 2017, provided that the legislative act to be adopted following the proposal referred to in Article 19(2) [new rules on the wholesale charges] is applicable on that date, roaming providers shall not levy any surcharge in addition to the domestic retail price on roaming customers in any Member State for any regulated roaming calls made or received, for any regulated roaming SMS messages sent and for any regulated data roaming services used, including MMS messages, nor any general charge to enable the terminal equipment or service to be used abroad, subject to Articles 6b and 6c.

From the user's perspective, Articles 6b and 6c are, of course, a fly in the ointment. The provisions lay down the two instances in which the "roam like at home" principle might be limited.

Article 6b refers to the so-called fair use policy, which roaming providers may apply in order to prevent abusive or anomalous usage of regulated retail roaming services by roaming customers, such as the use of such services by roaming customers in a Member State other than that of their domestic provider for purposes other than periodic travel. Fair use policies shall, however, enable the roaming provider’s customers to consume volumes of regulated retail roaming services at the applicable domestic retail price that are consistent with their respective tariff plans.

Example: mobile data 

Operators may, for instance, impose a certain limit on data use during roaming if a subscriber has unlimited mobile data or very affordable data package (a so-called 'open data bundle', cf. Article 4(2) of the implementing regulation). Roaming providers who decide to apply such a fair use policy, must inform the subscribers about this fact and alert them once the limit is reached. Beyond this threshold, subscribers can continue to use mobile data abroad, subject to a charge of maximum €7.70/GB + VAT. The charge will decreased gradually to reach €2.50/GB as of 2022.

Furthermore, Article 6c stipulates that in specific and exceptional circumstances, with a view to ensuring the sustainability of its domestic charging model, where a roaming provider is not able to recover its overall actual and projected costs of providing regulated roaming services in accordance with Articles 6a and 6b, from its overall actual and projected revenues from the provision of such services, that roaming provider may apply for authorisation to apply a surcharge. 

Specifics of both limitations are set out in the implementing regulation mentioned above.

... and how telecom operators read them?

First indications about the impact of the new law on the market practice can already be observed in several countries, for example in Poland, where telecom operators have just disclosed their new tariffs. Rather unsurprisingly, each of the four major telecom operators decided to impose certain limits on data use during roaming (from 1 to 8 GB depending on the subscriber's tariff plan). Interestingly, only one operator decided to apply the "roam like at home" principle without any significant limitations as regards the number of incoming and outgoing calls as well as text messages sent. The remaining three players established yearly limits, which would also be applicable to subscribers whose plans provide for unlimited domestic calls and SMS. Such an interpretation of the fair use policy appears to be at odds with what the European Commission had in mind.

The proposed price lists are currently being reviewed by the Polish telecom regulator, the President of the Office of Electronic Communications (UKE). What is already known today is that the new tariffs had not been welcomed in the Polish consumer protection agency, the Office of Competition and Consumer Protection (UOKiK), as well as in the EC, which may call upon the UKE to take action. It thus seems that interesting developments are still ahead!