A public consultation launched by the European Commission on 28 May is open until 25 June on the roadmap for a possible revision of the Directive on the Distance Marketing of Consumer Financial Services. The initiative is scheduled for the first quarter of 2022.
This 2002 Directive (2002/65/EC) aims to ensure the free movement of financial services in the single market while providing a high level of consumer protection. Its evaluation in 2020 showed that it needs to be updated, given its limited effectiveness due to a combination of factors.
Since 2002, the distance marketing of consumer financial services has evolved due to digitalisation and to the online business practices used by providers.
At the same time, the legal framework for retail financial services has evolved, notably through the development of product-specific legislation (e.g. consumer credit, mortgages and payment services, as far as the banking sector is concerned) and horizontal legislation (e.g. the ePrivacy Directive, the General Data Protection Regulation), thus considerably reducing the Directive’s relevance and added value.
The proposed revision would specifically address the following issues: - pre-contractual information requirements are not adapted to the digital environment; - the right of withdrawal (ex-post withdrawal within 14 days, rather than an ex-ante cooling-off period) is not fully effective in combating the risk of consumers being trapped in unsatisfactory contracts. Moreover, the practices of providers are too cumbersome for the effective exercise of this right; - more than 15 years after the transposition of the Directive by the Member States, the cross-border dimension of the purchase of financial products has remained limited.
To participate in the consultation: https://bit.ly/2S7ruJ3 (Original version in French by Aminata Niang)