July 21, 2014
The European Union recently enacted rules significantly expanding the rights of online consumers. The Consumer Rights Directive grants online consumers greater protection. It represents an important step forward empowering online buyers.
The Consumer Rights Directive helps online shoppers to protect themselves against faulty and unwanted products. The Directive extends the period of time during which a shopper can return a product to the vendor. The current return period is seven days, and the Directive extends that period to fourteen days, doubling the amount of time the consumer has available to review and consider purchased products.
The Directive also makes it easier for consumers to communicate questions and complaints about purchased products to the seller. Under the Directive, retailers must now provide consumers access to telephone numbers subject to standard, not premium, usage rates for complaints and questions. Previously, the telephone numbers provided to consumers were often subject to higher, premium usage rates which could impede consumer communications with retailers.
The Directive also prohibits use of transaction surcharges that are “excessive.” Some online retailers assess transaction fees and other surcharges associated with credit and debit card payments. The Directive requires that those surcharges must be reasonable.
The Directive bans use of pre-selected options for e-commerce transactions. The default setting in the online purchasing systems of some retailers includes use of pre-set option choices. For example, a vendor of travel services might include selection of trip insurance as a pre-selected option, and a consumer who does not want the insurance must remember to change that default selection before completing the transaction. Under the new Directive, use of those pre-selected options is no longer permitted.
It is important to note that certain e-commerce transactions are exempt from the provisions of the Directive. Gambling, package travel tours, and financial services are not included within the cope of the Directive.
The Directive is applicable in all of the 28 EU member nations. Each of those countries must now modify its consumer protection laws to harmonize them with the terms of the Directive.
The EU’s Consumer Rights Directive represents important progress in the continuing effort to protect online consumers against fraud and unreasonable commercial practices. American businesses that sell to consumers in Europe must monitor the new rules and plan for compliance.
The terms of the EU’s Directive provide a valuable model for use outside of Europe. Other jurisdictions should implement measures for protection of e-commerce consumers that are similar to those presented by the EU. Additionally, businesses not directly subject to EU oversight should consider adopting consumer protection practices consistent with the terms of the Directive, as those terms illustrate current best practices for consumer e-commerce rights.