Brussels, 05/10/2001 (Agence Europe) - The Green Paper published by the European Commission on the future of consumer protection in the European Union (see EUROPE of 3 October, p.6) invites all parties interested to contribute to resolving a problem that concerns the European Executive. The problem is that, although the internal market is now complete, consumers and enterprise especially SMEs are far from receiving all the advantages that they should be able to expect from it. This is due to the lack of confidence in crossborder transactions, and the diversity of national legislation regarding consumer interests in the case of dispute which makes consumers afraid to buy or sell goods and services in a State other than their own.
The Commission document stresses that it is the crossborder movement of goods and services that allows consumers to seek good bargains and innovative products and services and which guarantees that they can make the best consumer decisions. This crossborder demand, it says, strengthens the pressure of competition within the internal market and allows the supply of more effective services and goods, at competitive prices. Such a virtuous circle cannot be complete without a regulatory framework in place encouraging consumers and business to practice crossborder trade. The difference between national laws concerning trade practices in relations between business and consumers may hinder this development, stresses the Commission in its document.
The problem is not new, but the combination of three new factors makes it resolution urgent: 1) the introduction of euro notes and coins on 1 January 2002, which provides an ideal opportunity for
developing the internal consumer market, but which could fail if consumers have the impression that the internal market is only conceived in the interest of business; 2) the development of electronic commerce which provides new possibilities for business and for consumers; 3) the prospect of Union enlargement which creates the increased risk of fragmentation of the internal market by enlarging still further the range of national provisions.
As the Commission sees it, the solution lies in the establishment of a regulation system, guaranteeing equitable trade practices, reconciling the interests of companies and of consumers by assuring the latter a level of protection that is as high as possible at the lowest cost for companies, a system as simple as possible and sufficiently flexible for reacting rapidly to the market, and a system providing legal safety for operators, mainly in the event of crossborder disputes.
Two solutions are envisaged: - that of continuing the harmonisation, on a case by case basis, of specific legislation (after the fashion of that done, for example, for comparative advertising, abusive clauses in contracts with consumers, sales methods for food products, package tours, distance contracts, and medicines for human use) or that of elaborating a framework directive on equitable commercial practices establishing principles that must be complied with to ensure consumer protection. The framework directive would complete the harmonisation directives and the codes of conduct voluntarily adopted by businesses.
In a press release, David Byrne, Commissioner for Consumer Protection, declares that he attaches great importance to the debate on the Green Paper. He said the results of the debate will lay the base for the Union's policy with regards commercial relations between business and consumers and consumers' rights for the next ten years.
All parties interested are invited to make their comments on the Green Paper, by 1 January 2002, and above all to answer the following questions:
- What are the main obstacles that consumers and business encounter because of the differences in national regulations on good commercial practices or fair advertising practices and practices linked to pre-contractual, contractual and after-sales aspects of relations between companies and consumers?
- Do you agree consumer protection reform is needed regarding this aspect of the market? Should reform be based on the existing specific approach or on a joint approach?
- What impact are both approaches likely to have on the level of costs and advantages for consumers and business?
- If the specific approach is adopted, what should the priorities for harmonisation be?
- If the joint approach is adopted: a) What should be the key elements of a general clause, the general criteria and the essential rules of commercial practices regulation? b) What would be the best solution - a framework directive with a general clause based on fair commercial practice (which presupposes a principle of good faith) or solely founded on misleading and untruthful practices? What is the most adequate approach? What is the best approach for remedying the problem of fragmenting the internal market in the interest of consumers? c) Would it be appropriate to foresee a principle of self-regulation in a framework directive? If so, then what are the essential elements of these options and the criteria for their inclusion? d) To strengthen legal security, would it be advantageous to finalise non-binding practical guidelines? Is a legal framework needed to improve cooperation between the authorities responsible for enforcing consumer protection? What would the main elements of such a legal framework be?
Answers are to be sent by mail to the European Commission, Directorate General SANCO F 101 06/52 rue de la Loi 200 B 1049 Brussels, or by electronic mail to the address: consultsanco@cec.eu.int