Press digest

Mobile banking

The Financial Times Adviser discusses the ongoing plans to regulate on the European level mobile banking (Getting mobile banking working). Currently, the revision of the Payment Services Directive and of the Regulation on Multilateral Interchange Fees is being negotiated among the European institutions. 

On review of the mobile banking industry in the UK conducted by the Financial Conduct Authority see: Mobile Banking and Payments - FCA Industry Review. Important: no evidence of consumer harm was found in the mobile banking and payments area.

Tobacco Products Directive

Another company - Philip Morris International - was granted a right by the English courts to apply for a preliminary ruling in front of the Court of Justice with regards to the interpretation of the Tobacco Products Directive. This time it is the competence of the EU to regulate in this area that is being questioned: the argument is that the Directive does not aim to improve the internal market (e.g. it prohibits menthol even though it's legal in all Member States); that the Directive infringes consumers fundamental rights to information about the products they are choosing (through forcing companies to adopt plain packaging); as well as whether the delegation of power to the Commission to specify certain issue was validly defined (Philip Morris International Granted Right to Challenge EU's Tobacco Products Directive Before the Court of Justicce of the European Union).

Mortgage Credit Directive

Telegraph reports on the uncertainties related to the implementation of the new Mortgage Credit Directive in the UK - who exactly may be seen as consumer and fall under the Directive's scope? "Accidental landlords" - that is persons who became landlords "as a result of circumstance rather than through their own active business decision" will be seen as consumers. Who is that exactly? And what rules shall apply to buy-to-let mortgages? (Would this buy-to-let couple be caught out by new EU rules?)

Privacy online

If you are interested to see which applications and which online tools have what sort of privacy protection, check this data on the Secure Messaging Scorecard (A project of the Electronic Frontier Foundation).

US consumer news (just for fun)

Verizon fights against the Federal Communications Commission plan to introduce net neutrality, threatening to take them to court: Verizon: We Will Sue FCC Again If "Hybrid" Net Neutrality Happens.

Berkeley, California becomes the first American city to introduce a tax on sugary drinks: California City Votes In The Nation's First Soda Tax

Apple is being sued for an equivalent of wiretapping due to users who switched from an iPhone to an Android phone not receiving their iMessages (More Former iPhone Users Suing Apple, Claiming iMessage "Intercepts" Texts Meant for Android Phones).

Federal Trade Commission sues Gerber Products Co. for falsely advertising that its Good Start Gentle formula prevents or reduces the risk of children developing allergies (FTC Sues Gerber For False Advertising Over Claims Its Formula Can Prevent Allergies).

Air passengers' rights - Sandy Siewert and Others v Condor Flugdienst (Order in Case C-394/14)

Travelers become more and more familiar with their rights as stipulated by Regulation 261/2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights. A “long delay” means that passengers have a right to compensation starting once the airplane is delayed by three hours. Passengers simply have to fill in a special complaint form. Alternatively, various claims handlers operate in the sector.

Air carriers are, however, relieved of their obligations if the respective cancellation or delay was caused by extraordinary circumstances which could not have been avoided even if all reasonable measures had been taken (see Art. 5 (3) regulation). This provision continuously leads to court cases. In an order the Court of Justice of the European Union clarified another matter in this context on 14 November 2014. The reason for the delay of the airplane in the case at hand was that a set of mobile boarding stairs had collided with the aircraft, causing structural damage to a wing, as a consequence of which the aircraft had to be replaced.

Whereas it is established case-law of the Court that technical problems may be regarded as ‘extraordinary circumstances’, provided that they stem from an event which, owing to its nature or origin, is not inherent in the normal exercise of the activity of the air carrier and is beyond its actual control (Case C-549/07 Wallentin-Hermann), the situation at hand judged to be of a different nature.  Mobile stairs or gangways can be regarded as indispensable to air passenger transport and, therefore, air carriers are regularly faced with situations arising from the use of such equipment. A collision between an aircraft and a set of mobile boarding stairs is, hence, an event inherent in the normal exercise of the activity of the air carrier. As a consequence, the air carrier was not relieved of its payment obligation.

Rightly, by issuing an order and not a judgment the Court signals that this outcome is undisputed.

Please find the full text of the order here.

Producers of medicines must share information on their adverse effects - CJEU in Novo Nordisk Pharma (C-310/13)

20 November 2014: CJEU judgment in Novo Nordisk Pharma GmbH (C-310/13)

We wrote before on this blog about the problem presented in the case Novo Nordisk Pharma (Consumer's right to information about medicine's side effects - AG Szpunar in Novo Nordisk Pharma (C-310/13)). Yesterday, the CJEU gave its judgment, deciding that the Product Liability Directive and its maximum harmonisation character do not preclude such national legislation that imposes on trader's information duties not mentioned in this Directive. (Par. 33)

As a brief reminder, Article 13 of the Directive allows Member States to uphold such national special systems of liability that existed in a given Member State at the moment of notification of this Directive to the Member State. Germany has a special system of liability applicable to cases when consumers' health is damaged due to the use of medicines. This special liability system was, however, amended after the Directive has been notified by introducing a consumer's right to request from the producer of the medicinal product information on the adverse effects of that product. The German courts were unsure whether this requirement was, therefore, compliant with the Directive.

The CJEU confirms one of the views expressed by AG Szpunar, namely, that since the Directive does not regulate information duties of the producers, the consumer's right to request such information falls outside its scope (Par. 25, 29). Recital 18 of the Directive confirms that it doesn't aim to exhaustively harmonise the sphere of liability for defective products beyond the matters regulated by it (Par. 24). While the Directive places the burden of proof that the product was defective and caused damage on the consumer, the national legislation allowing consumers to request information on side effects of the medicinal products does not reverse that burden of proof but rather may only alleviate it (Par. 26-29). The CJEU does not see a possibility for the German provision to distort the effectiveness of the Directive's system of liability either (Par. 30-31).

All in all, this is good news for German consumers who may continue to require producers of medicinal products to send them detailed information on adverse effects of their medicines, which may enable consumers' claims for damages.

15th conference of the International Association of Consumer Law

FINAL CALL

Tomorrow is the deadline for submitting your abstracts if you wish to present at the 15th conference of the International Association of Consumer Law in Amsterdam next year. Of course, we will be happy to welcome you whether you decide to present or not, but just in case you wanted to share your research/ experiences with other attendees, please see this as a gentle reminder to notify us of your intentions. Details about submissions.

Conference on online gambling in the EU

Conference Announcement

If you are interested in consumer protection against remote gambling and want to stay up-to-date with the current developments on this subject, we would like to inform you about the upcoming conference on these issues.

Date: 25 November 2014 

Location: University of London Institute in Paris 

Theme: Regulating Online Gambling in the EU - Recommendation 2014/478/EU on Player Protection - Where Do We Go From Here?

More information: Link to conference website

Press digest

Cloud computing

New research suggests that 72% of European cloud users still are not able to answer any questions as to where their data is being transferred to, which means that even if they have been informed about this by their cloud service providers, this information clearly has not reached them. (see Many cloud systems 'not meeting EU data protection rules')

Mobile banking and mobile advertising

The European Banking Authority is consulting its new guidelines for providing more security to online payments market. The new guidelines of the European Banking Authority so far correspond to the rules of the EU Payment Services Directive. The question is whether it makes sense to adopt them as such as of August 2015 or whether to strengthen them already in the anticipation of the new PSD2. (New payment security guidelines to apply to online retail from August 2015) A brief summary of a current EU regulatory landscape with respect to mobile banking and payments may be found here: FCA thematic review - mobile banking and payments September 2014.

 Another article presents well how the use of smartphones influences modern advertising strategies. (3 Truths About Mobile Advertising In The Era Of Hyper-Connectivity)

 

Morality & consumers

The Archbishop of Bukavu and President of the Provincial Assembly of Bishops of Bukavu and Kindu addresses the European Parliament and other European institutions to guarantee that the resources used in consumer goods are not linked to human right violations and conflicts. (EU must give assurances on the morality of trade in natural resources)

Consumer behaviour

Interesting article on what went wrong with the consumer culture/ consumer image. (Viewpoint: How the consumer dream went wrong) Another survey shows us that at least in the US trust of consumers in using their credit cards have diminished recently; is it turn to popularize fingerprint-protected credit cards? (Data Breaches Are Affecting Consumer Behaviour and Trust in Credit Cards...)

BEUC on transparency in the TTIP

One of the most discussed issues regarding the Transatlantic Trade and Investment Partnership (TTIP) that is being negotiated by the EU and US concerns transparency. The TTIP negotiations have been heavily criticised for not giving enough clarity; it has been put forward that an open democratic debate is needed to legitimise the agreement (eg by Marija Bartl and Elaine Fahey, 'Transatlantic Partnership requires open democratic debate').

European consumer organisation BEUC has now published a number of suggestions for improving the input of an important group of stakeholders, ie consumers. Its recommendations are aimed at enhancing transparency and engagement in the TTIP, thus improving accountability to the public. BEUC's demands include: public access to documents, stakeholders' consultation, a more active role for the Advisory Group on the TTIP, and involvement of other EU institutions beside the Commission.

See also BEUC's new blog.

Information to a single consumer can not be regarded as a commercial practice - AG Wahl’s opinion in case C-388/13 UPC Magyarország

Yesterday, AG Wahl delivered an opinion in case C-388/13 UPC Magyarország concerning the Unfair Commercial Practices Directive. 

The Hungarian Court referred two questions to the CJEU on the basis of a claim filed by Mr S alleging that he had been provided with erroneous information by UPC Magyarország – a provider of cable television services.

The first question raised no new issues and the answer was easily to foreseen. The CJEU has already assessed in the judgment CHS Tour Services, that the UCPD must be interpreted as meaning that, if a commercial practice satisfies all the criteria specified in Article 6(1) of that directive for being categorised as a misleading practice in relation to the consumer, it is not necessary to determine whether such a practice is also contrary to the requirements of professional diligence as referred to in Article 5(2)(a) of the UCPD in order for it legitimately to be regarded as unfair and, therefore, prohibited in accordance with Article 5(1) of the UCPD (par. 16).

AG Wahl focused on the second question and denied that a communication of false information to a single consumer may be regarded as a commercial practice within the meaning of the UCPD. According to AG Wahl, an act may be regarded as a commercial practice within the meaning of the UCPD, when either or both of the two following conditions are fulfilled: 

- the conduct is directed towards an unspecified group of addressees; 

- the conduct is repeated in relation to more than one consumer (par. 23). 

The CJEU has not yet dealt with a question concerning the classification of an isolated act of a trader affecting a single consumer in light of the UCPD. AG Wahl is of the disputable opinion that the UCPD is aimed at the protection of the collective interests of consumers (par. 32). It is, of course, possible that the CJEU will not share the opinion delivered yesterday, but whatever the judgment may decide it will be certain to further clarify the scope of the UCPD.

New Commissioner for "Justice, Consumers and Gender Equality"

Yesterday the European Parliament has enacted the Juncker Commission. It will thus start its term of office on 1 November 2014 after being formally appoined by the European Council. The Czech politician Vĕra Jourová will be the new Commissioner for Justice, Consumers and Gender Equality. 

The key files she mentions in her introductory statement are:

- reform of data protection rules;

- the European Public Prosecutors Office;

- the Women on Boards proposal;

- the Consumer Product Safety Regulation.

Press digest

Telecommunication

The European Commission announces not to further regulate fixed telephone lines, since the market moved towards mobile and online telecommunication. (Europe says goodbye to fixed line regulation, hello to mobile era)

Tobacco Products Directive

UK e-cigarette manufacturer, Totally Wicked, challenges the validity of art. 20 of the Tobacco Products Directive at the CJEU, claiming that e-cigarettes should not be regulated as "tobacco related products" if they don't contain tobacco. (E-cig manufacturer wins right to challenge Brussels in EU courts; Totally Wicked vs. the EU's tobacco directive; First e-cig TV adverts from next month)

EU Data Protection and ePrivacy rules

Worries are being expressed about strengthening existing data protection rules even when businesses do not seem to be able to hold to currently existing ones (EU set to strengthen data protection laws). Data Protection Authorities across the EU are currently stepping up enforcement of the compliance with the existing EU data protection rules, by conducting a widespread cookie sweep (Are you ready? The EU "Cookie Sweep" is upon us). Other sources report widespread non-compliance of cloud-based storage service providers with the existing EU data protection rules (Most cloud apps flout EU data protection rules - study).

Tourism sector

TUI Travel argues in the UK for more support to be given to the reform of the Package Travel Directive and the Regulation No 261/2004 on air passenger rights. (TUI Travel calls on UK government to support the travel and tourism sector at home and abroad)

Competition

European booksellers plead with the European Commission and BEUC to set up investigation into the monopoly position of Amazon in the online book market, which harms European consumers by depriving them of a rich and diversified online book offering. (Booksellers raise Amazon monopoly concerns with European Commission)

Health claims

The new rules on food labelling (EU Regulation 1169/2011 on food information to consumers) are to enter into force as of December 2014 (nutrition information as of December 2016). Especially the sport nutrition sector may have to invest time and money to adjust the labels of their products to the new rules. While this regulation forces producers to be very specific in listing ingredients of their products, it may be even more difficult for the producers to justify placement of easy claims on how certain products may boost energy etc. (which are also regulated by Regulation 1924/2006). (Claim, set and match)

Consumer behaviour

Two new survey results have been published showing us growing trends of consumer online shopping habits. (UK leads European online shopping; Northern European web shoppers spent €1,780 each in 2013) In the meantime, Facebook sets up a new division - Facebook IQ - to try to understand consumer behaviour better... (Facebook forms new unit to study consumer behaviour).