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The EU Consumer Rights Directive and Online Shopping

Published on October 21, 2011
Tags: Web Site Law, Internet Communication

Back in June, the EU Parliament passed something called the Consumer Rights Directive. This Directive has since been approved by a meeting of EU ministers and has now become law. Nations have got two years to comply with this new legislation – but what exactly is it?

As the name of it suggests, the Consumer Rights Directive is aimed at protecting consumer rights. It isn’t exclusive to online consumer activities, but this is one of the areas where it is set to have an impact. One of the main points of the directive is to stop websites from ‘pre-ticking’ boxes on online order forms, on the grounds that this can often lead to consumers signing up to things that they didn’t know they were signing up to. Web designers should take note, as there may be an obligation in the client-supplier relationship for the designer to give best advice on such matters.

One well-used example of this is company newsletters: you buy a product from an ecommerce website, but fail to notice the pre-ticked box agreeing to sign up to the online newsletter and future updates about the company and its products. Subsequently, you get inundated with advertising material you never wanted. Some pre-ticked boxes can even cost consumers money. The example given by the European Commission is the way the travel insurance box or an option for car rental will sometimes automatically be pre-ticked when customers are purchasing airline tickets.

Now all of this is going to have to stop, as pre-ticking boxes on order forms has been banned. Another aspect of the legislation is that it stops customers from being liable for charges they weren’t properly informed about when they made a purchase. They also get a fourteen day ‘cooling off’ period on purchases during which they can withdraw from their contract if they wish.

This isn’t the only thing the EU have done recently to try and protect consumers’ rights: the Privacy and Communications Directive does something similar in relation to internet advertising and online cookies, requiring users to give their consent before certain cookies can be used to stop sites from collecting so much information about them.

This brings us back to the eternal struggle between the rights of the consumer and the need for businesses to survive. It also brings us on to issues of implementation, something that is causing a bit of a headache in relation to the Privacy and Communications Directive, as countries have interpreted the legislation differently. But national interpretations and philosophical arguments aside, what does all of this mean for ecommerce websites? Will they be penalised by these recent EU directives?

On the one hand, you could argue that they are being penalised as the Privacy Directive makes collecting useful data more of a burden and the CRD stops them from taking action that may have bought in more business or helped them to get their message out to a larger number of people. However, protecting consumer rights is important and so these directives are largely positive. It also helps to make websites more honest as consumers will now have to specifically state whether or not they would like extra services rather than ending up with them regardless – something that the customers are sure to appreciate.

For example, in a recent press release, the EU details ten benefits of the new Consumer Rights Directive. The first of these benefits is that customers will be protected against ‘cost traps’ that trick them into paying for services online that ought to be free. Another benefit is that hidden charges and costs are not allowed, and consumers will have to confirm to say they understand the price they are being charged. This suggests that the only sites that will be losing out are those that probably shouldn’t be in business anyway.

Also, ecommerce is an area that is growing strongly, bucking the trend as many other areas of the economy continue to struggle. It doesn’t seem likely that these directives will stop this growth: after all, they strengthen the rights of the consumer, so if anything, they will help ecommerce even though online businesses might not like everything within the directives.

This is especially true in the UK. Figures from the IMRG tell us that the UK is the leading e-retail economy in Europe: if sales for 2011 stay on track, they’ll be worth €81billion by the end of the year.  Ecommerce is also growing at a rate of 18% per annum and more than 1 billion packages are shipped out across the UK as a result every year. It seems safe to say that a couple of Directives from the EU aren’t going to stop the online shopping juggernaut.

By Chelsey Evans

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Commented on November 8, 2011

Great post, thanks to sharing, online shopping is the best way for shopping.

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