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E-commerce : when purchasing games, books, videos or music on-line, look out for unfair terms, warns the EU

European Commission - IP/12/1320   06/12/2012

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European Commission

Press release

Brussels, 6 December 2012

E-commerce : when purchasing games, books, videos or music on-line, look out for unfair terms, warns the EU

Just in time for the holidays and gifts shopping season, the European Commission today publishes the results of an EU wide screening of websites selling games, books, videos and music which can be downloaded to a computer or mobile device. The check shows that over 75% of these websites do not appear to comply with consumer protection rules. This is all the more worrying when vulnerable consumers, i.e. children, are targeted. Users have to click their way through a maze of contract terms, to find out how much they will eventually have to pay and children are frequently lured into purchasing items related to supposedly free games. In case of a problem, reaching the after-sales service is often difficult as contact information is missing in more than one third of the websites. National enforcement authorities will now contact the companies concerned to enable them to clarify their position or correct their website.

Commissioner in charge of Health & Consumer Policy, Tonio Borg, said: "Children are increasingly at ease with technology; from an early age, they know how to download games. However once they are addicted to playing with a certain product, it is difficult to stop them. Parents beware, half of these downloadable games are advertised free to play, but you may soon end up with rocketing bills covering virtual items needed to progress. In general, the EU sweep published today shows that a majority of checked websites do not provide easy access to key contractual terms. In the coming months, national authorities will be working to get these websites on the right track."

Results

National authorities from 26 Member States1 plus Norway and Iceland checked a total of 333 websites, including 159 selling online games. They flagged 76 % of all websites (254 sites) for further investigation as they had doubts about the websites' conformity with EU laws protecting consumers, especially rules governing advertising and key information about costs and characteristics of digital content which enable consumers to make informed decisions2. Of the 55 sites selling games for children aged below 14 checked, 71% (39) seemed non-compliant with EU laws.

The main problems were:

  1. Unfair terms: contract terms must be clearly indicated and fair. A total of 230 websites (69%) contained terms considered unfair, e.g. i) excluding the trader's liability in case a download damages the consumer's equipment, ii) excluding or preventing consumers from exercising their right to seek legal or other redress or making it difficult to do so, or iii) depriving consumers of the right to receive a new product or to claim reimbursement when the downloaded product fails to work;

  2. The right of withdrawal: due to the nature of downloads, the consumer loses his right of withdrawal from the contract when downloading has begun with the consumer's agreement (in other words, the downloaded product cannot be returned); however traders are required to inform consumers prior to the purchase about this fact. 141 websites (42% of websites checked) did not provide this information;

  3. Missing information on the trader's identity and address: traders are obliged to indicate their identity, geographical and email address on their website to enable consumers to contact them, if necessary. 121 websites (36%) did not display such essential information.

In addition to the sweep, the Commission contracted a complementary study3 that revealed the following:

  1. No information about geographical restrictions: consumers may not be able to use downloaded digital content in a country other than their place of residence and traders should inform them about this. 73% of all checked websites remain silent on this information. When this information is given, it is often presented only in the general terms and conditions and is therefore difficult to find.

  2. Games advertised as "free" often involve some payment at a later stage: Nearly 9 out of 10 websites failed to inform users upfront about add-ons or in-game purchases requiring payment; although this information is often mentioned in the contract terms, it bears no clear indication about prices.

Background

A "sweep" is an EU-wide screening of websites, to identify breaches of consumer law and to subsequently ensure its enforcement. The sweep is coordinated by the Commission and run simultaneously by national enforcement authorities. The Digital Content Sweep took place in June 2012. It is the sixth Sweep since 2007.4

A growing percentage of European citizens purchase digital content: on average, 79% of European consumers have used online music services and 60% online games over the last 12 months. According to industry sources,5 the trade volume of music downloads in the EU was €677 million in 2010; consumers in the UK, Germany, France, Italy, Spain, Netherlands and Belgium are estimated to have spent €16.5 billion on online games in 2011. Games targeting children and advertised as "free to play" represent an increasing share of the EU games market (50% of all games over the last 12 months).

What happens next?

National authorities have already started to contact companies and ask them to provide clarifications or correct their websites. Failure to do so can result in legal action leading to fines or even closing down of websites. The national enforcement authorities will report back to the Commission by autumn 2013. The Commission will report on the results.

For more information:

Sweeps website: http://ec.europa.eu/consumers/enforcement/sweeps_en.htm

MEMO/12/945

Follow us on Twitter: https://twitter.com/EU_Consumer

Contacts :

Frédéric Vincent (+32 2 298 71 66)

Aikaterini Apostola (+32 2 298 76 24)

1 :

Ireland could not participate due to lack of resources.

2 :

Distance Selling Directive, Unfair Commercial Practices Directive, E-Commerce Directive and Unfair Contract Terms Directive.

4 :

Previous sectors were airlines, mobile phones, electronic goods, online tickets and consumer credit.

5 :

See study referred to under footnote 3.


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