On the evening of Tuesday 6 June, the European Parliament and the Council of the European Union reached a political agreement on the May 2022 proposal for a directive that will modernise EU legislation on the marketing of financial services contracts concluded at a distance (Directive 2002/65/EC, which will be repealed) to adapt it to the increasing digitalisation of the market.
The second session of interinstitutional negotiations enabled this progress to be made on a text that aims to strengthen consumer protection and their rights to clear pre-contractual information on what they buy online by adding a new ‘financial services’ chapter to Directive 2011/83/EU on consumer rights (known as the CRD Directive) (see EUROPE 13191/24, 13133/2). The rules introduced in the CRD will act as a safety net for financial services that are not covered by specific sectoral legislation.
The text of the provisional agreement will also create a level playing field for the cross-border provision of financial services in the single market.
“Once the directive comes into force, consumers in the single market will be assured a higher level of protection when accessing new financial products and services from their phones and computers”, commented the Swedish Minister for Justice in a press release issued on behalf of the Swedish Presidency of the EU Council.
“This agreement will make it easier for consumers to withdraw from contracts. Now we will have clear and modernised rules, without putting extra burden on companies”, said the European Parliament’s chief negotiator, Arba Kokalari (EPP, Swedish).
The agreement improves the rules on information disclosure and aims to modernise pre-contractual information obligations, while maintaining the possibility for Member States to impose stricter national rules so as not to lower the level of consumer protection already guaranteed in certain countries, as the Council wished.
Where the trader uses online tools such as robo-advisers or chatbots, consumers will have the right to request human intervention to better understand the effects of the contract on their financial situation.
The agreed text will make it easier to exercise the right of withdrawal from contracts concluded at a distance by including in the service provider’s interface an easy-to-find ‘withdrawal function’ (a technologically neutral term, as Parliament wanted).
The aim is to make consumers aware of their rights of withdrawal and to ensure that withdrawing from a contract is not more burdensome than entering into one. The withdrawal function will apply to all contracts concluded at a distance, not just financial services contracts.
The provisional agreement also stipulates that once the new rules are in force, Member States will have to take measures to limit the use of ‘dark pattern’ marketing techniques designed to influence consumer choice - a concern of major importance to the European Parliament.
The European Commissioner for Justice, Didier Reynders, welcomed “a swift agreement on this important file, which will ensure that EU consumers are adequately protected when concluding financial services contracts online, including for new products that might come onto the market”.
It is now up to Parliament and the Council to ratify this provisional interinstitutional agreement. Once formally adopted, the new rules will be published in the Official Journal of the EU and will come into force 20 days later. Member States will then have 24 months to transpose the directive into national law and a further 6 months to apply it. (Original version in French by Aminata Niang)