Vehicles should be quieter but not silent

The newest trend among my friends is to invest some money into buying noise-cancelling headphones. You use them not only in public spaces where on the one hand you may want to block out noise made by traffic and strangers and on the other hand you could try to limit the noise you are making. No, you use them also at work, at home, to improve your concentration by eliminating any external noise. Surrounding yourself with silence seems to be a goal nowadays. In similar spirit, the European Parliament´s Environment Committee endorsed on Wednesday new proposals for regulating traffic noise in order to protect pedestrians´ health (noise made by standard cars would need to be limited from 74db to 68db in 12 years).  Consumers would be better informed as to the noise level their vehicles make due to an introduction of a new labeling system. Interestingly, the soundless electric and hybrid cars raise worries among the MEPs, since they are seen as potential threat to pedestrians who won’t expect their approach and therefore, a cause for more accidents. The proposal would be to add some acoustic to these vehicles in order to increase road safety. (Environment MEPs back law to turn down harmful traffic noise)  It seems then that the goal is to limit the noise but not to cancel it.

Additionally, on Tuesday MEPs and member states’ negotiators reached an informal deal regarding new rules on CO2 emissions that should be achieved by 2020 (95g/km as mandatory target applicable to 95% of new cars). (Car CO2 emissions: MEPs reach a deal with Lithuanian Presidency of the Council)

Back to the future vehicles

In January 2013 the European Commission proposed a new Directive pursuant to which the Member States would be required to set up a specific minimum of alternative fuels stations (electricity, hydrogen and natural gas) across the EU, with common standards. This would enable European consumers to easier choose for alternative fuels vehicles, since they would be assured they could use them with ease traveling in the EU. Currently, the problem is that not many refueling stations are built since not enough consumers purchase such vehicles, while consumers do not choose for these vehicles due to lack of support system. On Tuesday the European Parliament´s Transport Committee voted in these measures. The MEPs proposal strengthened Commission’s, e.g., by requiring that consumers were better informed about the different prices of fuels offered, so that they could easily compare them; that the colors of hoses and nuzzles were harmonized across the EU facilitating consumer use thereof; that electricity was made available at airports and that consumers could recharge electric vehicles during off-peak times, when prices are lower. The Commission criticizes, however, the lack of provisions on recharging points not accessible to the public, as potentially reducing the consumers’ confidence in the electric cars market. (Alternative fuels for transport: Parliament committee vote supportsroll-out of refueling infrastructure)

Online music services

On Tuesday the Legal Affairs MEPs endorsed the new rules on copyrights that make it easier for online providers to obtain copyright licenses to stream music cross-border. This could be achieved by allowing online providers to obtain these licenses from a small number of authors’ collective management organizations  that operate across EU borders, instead of forcing them to obtain separate licenses from national organizations in every Member State they provide services to. The aim is that EU-wide online music services are made available to consumers, while at the same time music authors rights and their royalties are protected. 

Money, money, money – BEUC on recent EU proposals related to consumer payments

On 18 November the Economic and Monetary Affairs Committee of the European Parliament voted on the Commission’s proposal regarding bank accounts. The new rules aim to increase bank fees´ transparency, facilitate switching between bank accounts and make opening of a basic bank account simpler and affordable for anyone (currently 10% Europeans do not have a bank account). BEUC in its press releases criticizes certain developments with regard to the proposal: suspension of a rule that would create a system for automatic redirection  of payments from the former to the new account; Member States will need to harmonize terminology for only 10 services linked to a bank account and not all of them, which will not serve the aim of assuring full transparency. (Bank account plans: Timid steps towards more transparency)

 

This week BEUC evaluated two new Commission’s proposals that intend to increase consumer protection on the financial services market. First, the proposal for a Regulation on interchange fees for card-based payment transactions was positively evaluated by BEUC, even if they argue that it should remain a minimum harmonization area, so that the Member States are allowed to protect consumers more (by reducing the interchange fee caps, e.g., below the suggested 0,2% or 0,3% level). BEUC expresses also its preference for an EU-wide ban on surcharges. It argues also for the choice to be left to consumers as to what payment brand they want to use at the point of sale. The consumer should also be able to decide freely whether or not he needs two or more different payment brands on his card, telecommunication or IT device, etc. In general, the new framework would be a positive development for consumers potentially limiting the monopoly of two credit card companies that dominate the payments market in the EU (Mastercard and Visa), often prevailing over national debit cards that are cheaper to use for consumers and merchants in comparison to international cards.

 

Second, the proposal for the new Payment Services Directive was assessed by BEUC. BEUC again argues here for these rules to have a minimum harmonization standard, so that the Member States could maintain stricter rules they already have in favor of consumer protection. Electronic money should fall within the scope of payment services regulated by the Directive. The EU-wide ban on surcharges is required by BEUC also with respect to these rules, since surcharges are perceived as having failed in steering consumers towards more efficient and cheaper means of payment. The payment service providers should refund any unauthorized transactions from the consumers’ accounts on the same day they have become aware thereof (currently the obligation of ‘immediate’ refund is interpreted differently across the EU) and consumers should be granted an unconditional refund right for direct debit transactions. This would give consumers control over his direct debit payments and provide easy redress instruments in case of fraudulent payments or undelivered goods/services. In order to protect consumers against payment frauds and incidents thereof should be reported regularly to national and European authorities.

 

See BEUC's website for more detailed assessment.

Scope of required disclosure when buying securities - AG Sharpston in Timmel (C-359/12)

26 November 2013: AG Sharpston opinion in case Timmel (C-359/12)

It's a cliche but financial services are often complex and consumers often require more strict protection measures with respect to such services. Currently, many consumer protection measures rely on information duties (despite raising criticism of this instrument it is still predominant) and what kind of information is to be disclosed and in what form often is subject to lengthy disputes. In the Timmel case AG Sharpston gave its opinion on the mandatory information that needs to be revealed in a 'prospectus' to the public interested in purchasing securities. 

The Prospectus Directive requires such information to be conveyed that enables investors to make an informed assessment of the financial position of the issuer and of the rights attaching to the securities in question. Regulation No 809/2004 sets detailed requirements for the content and format in which information should be presented in a prospectus. Interestingly, while the Directive mentions certain information as mandatory, the Regulation allows the issuer of a prospectus to omit such 'required' information if it is not known at the time when a base prospectus is approved and can only be determined at the time of issue (Par. 38). Mr Timmel subscribed for Dragon FX Grant securities (drawn up by Lehman Brothers Treasury Co.), for which certain required information was omitted from the base prospectus and from a supplement to it. He argued that he had a right to withdraw from the contract due to not valid publication of the securities in question, which right of withdrawal is granted to consumer-investors (private persons acting on their own account, not on behalf of a company). The AG Sharpston considers the supplement to the prospectus as having a function of correcting any material mistakes or inaccuracies as well as revealing significant new factors (Par. 41). If the required information became known to the issuer after the prospectus has been published but would not materially influence the assessment of securities, it does not have to be revealed in the supplement but may be added to the final terms instead (Par. 51).

Not only the base prospectus or its supplements did not contain required information, but they were also not made publicly available. The documents could only be found and retrieved for awhile on the homepage of the Luxembourg Stock Exchange, following a lengthy and complicated registration process, upon which only two documents per month could be consulted free of charge. This contradicts according to the AG Sharpston the requirements of Art. 29 Regulation, pursuant to which a base prospectus should be easily accessible to an investor when entering the website (Par. 68).

Additionally, the AG clarifies the issue as to where the base prospectus must be made available: at the registered office of the issuer and at the offices of the financial intermediaries (Par. 84).

Belgian improper implementation of Unfair Commercial Practices Directive - AG Cruz Villalón in Commission v. Belgium (C-421/12)

26 November 2013: AG Cruz Villalón opinion in case Commission v. Belgium (C-421/12)

AG Cruz Villalón was busy in the last couple of days since he also issued an opinion today in the EU case against Belgium, in which it was claimed that Belgium did not properly implement Unfair Commercial Practices Directive. In general, the AG supports all three claims made by the Commission against Belgium. 

First, while the UCP Directive is applicable to all traders, regardless of their legal status or the sphere of their commercial activity, Belgium decided to exclude certain professions from the application scope of its national law implementing the Directive, namely: representatives of liberal professions, dentists and physiotherapists (only misleading and comparative advertisement is prohibited in Belgium with respect to these professions).

Second, while the UCP Directive intends to fully harmonize unfair commercial practices in Europe, Belgium sets consumer protection level higher with respect to informing consumers about discounted prices. Namely, prices may be marked as discounted only if their price is lower than the lowest price that has been set by the same trader on them in the given month. Since the Directive does not blacklist a commercial practice that would inform consumers about discounted prices in other circumstances than mentioned in the national law, the national law may not do that either.

Third, the UCP Directive does not prohibit certain commercial practices as unfair that have been declared as unfair and prohibited in Belgian law: many forms of off-premises sales and travelling trading (the value of the off-premises sale may not be higher than 250 euro per consumer; health products, health plants or products made thereof, medical devices, lenses, metals, jewels, pearls, weapons and ammunition may not be sold off-premises). Since these prohibitions have not existed in Belgian law prior to the adoption of the Directive they should not fall within the scope of national provisions that could remain upheld in the transitional period by national legislators.

Ius est ars boni et aequi - Opinion of AG Cruz Villalón in Case C-314/12 UPC Telekabel Wien

What responsibilities do digital service providers have towards copyright holders? Can an internet provider be required to block access to a website on which movies are made available without the consent of the film industry?

Case C-314/12 UPC Telekabel Wien v Constantin Film Verleih & Wega Filmproduktionsgesellschaft, which is currently pending before the Court of Justice of the EU, gives a clear illustration of the problem. The case concerns the access to a website on which more than 130,000 (!) movies were made available for streaming and downloading without permission of copyright holders. The owners of the website, which was taken offline after criminal investigation, were prosecuted in Germany. The present case regards the legal responsibility of an internet service provider whose services allowed Austrian users to access the illegal website. The question at issue is whether the internet provider, who had no (contractual) relation at all to the makers of the website, was under a legal duty to prohibit users from accessing the website.

In a nuanced Opinion in this case, Advocate General Cruz Villalón submits that it is not compatible with EU law to impose a general prohibition on an internet provider to allow its users to view a website that violates copyright law, without giving any specific guidance as to concrete measures that should be taken so as to prevent access to the site. According to the AG, moreover, this is not different in case a provider may avoid sanctions by demonstrating to have taken all reasonable measures to uphold the prohibition.

Still, in AG Cruz's opinion, a national measure specifically requiring a certain provider to block access to a designated website is not as a matter of principle disproportionate for the sole fact that it requires the service provider to incur not inconsiderable costs, while users may easily circumvent the technical measures taken by the service provider. It remains the task of national judges to strike the delicate balance of parties' rights in specific cases.

The AG bases his conclusions on the balancing of fundamental rights within the ambit of what is 'fair and equitable' and 'proportionate' in the sense of Article 3 of Directive 2004/48 on the enforcement of intellectual property rights. The balance involves the right to protection of intellectual property (Article 17(2) of the EU Charter of Fundamental Rights) and, on the service provider's side, freedom of information (Article 11 of the Charter) and freedom to conduct a business (Article 16 of the Charter). As AG Cruz points out, imposing a general obligation de résultat on the service provider to prevent access to websites that violate copyright law does not reflect a fair balance of these rights. Giving a service provider the possibility to avoid sanctions by showing to have taken all reasonable measures does not restore the balance, as it pushes back the consideration of relevant fundamental rights argumentation to the second stage of the assessment. Moreover, while a copyright holder has strong claims in hand, a digital service provider who is not infringing copyright himself would hardly have any defence against the imposition of a burdensome general measure aimed at preventing the abuse of intellectual property rights by third parties to which the provider has no contractual relationship.

In sum, the complex task of balancing the interests and rights involved in cases of massive copyright infringements through the internet would remain a task of national judges in specific cases.

See also the CJEU's press release (which, interestingly, leaves out most of these nuances of its heading).

Are you watching your tv or is your tv watching you?

Smart TVs are devices which combine the features of a traditional TV screens with interactive media. Basically, they allow their owners to not only watch content, but also to store it and browse among different sources, using local networks as well as- most importantly for our story- accessing the internet.

from https://secure.flickr.com/photos/jenik/2397132902/

A few days ago, the reputed website Ars technica first reported that a blogger had "offered evidence that his Internet-connected television has been transmitting detailed information about his family's viewing habits, including the times and channels they watch and even the names of computer video files stored on connected USB drives." 

Soon, a second user provided similar evidence. The revelations apparently prompted a reaction from the producer, LG, which released a statement whose most important passage goes as follows:

"Information such as channel, TV platform, broadcast source, etc. that is collected by certain LG Smart TVs is not personal but viewing information. This information is collected as part of the Smart TV platform to deliver more relevant advertisements and to offer recommendations to viewers based on what other LG Smart TV owners are watching. We have verified that even when this function is turned off by the viewers, it continues to transmit viewing information although the data is not retained by the server. A firmware update is being prepared for immediate rollout that will correct this problem on all affected LG Smart TVs so when this feature is disabled, no data will be transmitted."

The issue might remain slightly controversial even once the disabling function is brought to work: should the consumer actually be expected to know that, unless she actively prevents it, her TV will send information about her habits to its producer (not only LG)? Or should the default be that the no information can be collected, unless the consumer explicitly allows it? Also, the distinction between "viewing" and "personal" information does not mean automatically that companies should feel free to collect it without further ado.

In the lengthy discussion which has so far accompanied the political process of revising the EU privacy rules, much of the attention has been concentrated on websites, e-commerce and so on. What about this? It is not easy to find the right approach when dealing with a dimension which evolves so rapidly as that of technology & privacy, but this is no reason to simply give up...

Compliance required

Italy was asked to comply with EU rules granting certain rights to rail passengers. At the moment, there are no enforcement authorities nor sanctions for violations of passengers rights established in Italian law, which means that whoever travels by train in Italy may not be able to claim their rights when things get... derailed.

Luxembourg was given two months to take measures to comply with the requirement to deliver proper market analyses to European Commission. Such analyses allow to see whether the given market sector (offering products and services to consumers within the electronic communications sector) is competitive enough, etc.

See more: November infringements package

Restrictions on hazard

Online gambling is quite a controversial service in Europe. In general, European countries are allowed to put restrictions on provision of online gambling within their borders, due to public interest objectives (such as consumer protection, fraud prevention etc.). However, the justification for applying such restrictions needs to be real and concrete, and applied consistently, since otherwise freedom of provision of services within EU should prevail (see e.g. out post on recent AG's opinion in the CJEU case Pfleger). During the last year, the European Commission was evaluating current national provisions restricting online gambling. Yesterday, it was announced that at the moment Sweden does not apply its national restrictions systematically. While national rules give exclusive rights to certain service providers for providing online betting services and online poker services, the compliance with these restrictions is questionable (at the same time, Finland was seen as properly having enforced compliance). Some other countries were asked to provide more information on possible restrictions and licensing procedures with regards to online gambling services. (see more: Commission requests Member States to comply with EU law when regulating gambling services)