New EU consumer protection rules to tackle misleading and unfair practices
European consumers can expect better protection against misleading and unfair practices following a vote in Parliament’s internal market committee on 22 January.
The update, which aims to ensure that consumers across the Union have the same rights, will now be put to a vote of the entire Parliament.
MEPs want to strengthen consumer protection by introducing collective redress and imposing more dissuasive penalties on non-compliant companies. The legislation also covers new scenarios where no EU law currently exists, especially in the online world as well as regarding the dual quality of products.
When buying from an online marketplace, consumers will have to be clearly informed about who is selling the product or service and whether the vendor is a professional or another consumer. It should be clear from the outset where responsibility lies and which laws are applicable.
The so-called “New Deal for Consumers” will also ensure more transparency in online search results. Users will be made aware if the high ranking of products or services in search results is due to paid placements.
Consumer rights will also be strengthened in the area of “free” digital services, contracts for which no money is paid but which allow traders to use consumers’ personal data. Just as consumers can cancel online contracts for paid digital services within a fortnight, they will also be able to cancel contracts based on the use of personal data. This would typically apply to cloud storage services, social media or email accounts.
Rules allowing groups of consumers harmed by illegal practices to launch collective actions and seek compensation will apply to all EU countries. In order to seek mass compensation, replacement or repair, it will be possible to organise one representative action on behalf of consumers from several EU countries.
The right to claim financial compensation or the termination of contracts in case of unfair commercial practices will be harmonised across the Union.
EU consumer authorities are not always well equipped to sanction practices creating “mass harm situations” that affect a large number of consumers across the EU, and the level of penalties varies and is often too low to have a deterrent effect. To resolve this situation, national consumer authorities would be granted the power to impose effective, proportionate and dissuasive penalties in a coordinated manner.
The legislation will also tackle the issue of dual quality products where goods are marketed under the same brand but differ in composition or characteristics. Consumers are led to believe that they are buying the same product when in fact they are not. As studies have shown evidence of such practices in the food industry, MEPs want the issue of dual quality added to the unfair commercial practices’ blacklist. ■