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Brussels, 21 September 2006

Distance Selling Directive: state of play and public consultation

Today the European Commission adopted a Communication on the implementation of Directive 1997/7/EC on Distance Selling, and launched a consultation in order to assess the need to update the Directive. All EU Member States have transposed the Directive, but some problems have emerged with its practical application. For instance, reliance on new technologies, such as “mobile commerce” through SMS, and the popularity of certain marketing methods, such as on-line auctions, underlines the need to consider the effectiveness of the regulation of distance selling. The use of the “minimum clause”, allowing Member States to introduce more stringent provisions to ensure a higher level of consumer protection, has also led to differences in the degree of protection from one Member State to another. This may have led to divergences and distortions in the internal market.

Markos Kyprianou, Commissioner for Health and Consumer Protection, said: “Member States have shown they are engaged in ensuring a high level of consumer protection across the EU. Some of them have gone even further in transposing this key piece of EU legislation into national law. What I am most worried about are possible loopholes or areas of legal uncertainty created by new and fast-growing distance selling products and technologies, which might create confusion for consumers and serious business alike, or be exploited by rogue traders. The consultation we are launching today will help us gather valuable stakeholder feedback on whether and how to update the Distance Selling Directive. It will also feed into our broader review of the Consumer Protection body of legislation next year.”

Distance selling

Most contracts, where a consumer and a supplier engage in a distance-selling transaction without meeting face to face at any stage until after the contract has been signed, are covered by the Distance Selling Directive. Its aim is to put consumers who purchase goods or services through “distance communication means” (for instance, by mail or by phone) in a similar position to consumers who buy goods or services in shops (face-to-face selling).

Consumer rights

These include the provision of comprehensive information before the purchase; confirmation of most of that information in a durable medium (such as written confirmation); consumer's right to cancel the contract within a minimum of 7 working days without giving any reason and without penalty, except the cost of returning the goods (right of withdrawal); where the consumer has cancelled the contract, the right to a refund within 30 days of cancellation; delivery of the goods or performance of the service within 30 days of the day after the consumer placed his/her order; protection from unsolicited selling; protection from fraudulent use of payment cards; non validity of any waiver of the rights and obligations provided for under the directive, whether instigated by the consumer or the supplier.

Main issues of concern

National divergences in transposition result in particular from the use of the “minimum clause”, which states that Member States may introduce or maintain more stringent provisions to ensure a higher level of consumer protection as long as these measures are compatible with the EU Treaty. This may have an impact on the Internal Market and may affect business and consumer confidence in cross-border trade.

Other problems arise from the emergence of new products and new technologies, to which the Directive is not always fully adapted: these include m-commerce (i.e. commerce undertaken by short message service, sms) and on-line auctions on websites such as eBay. “Cooling off” periods also vary depending on the interpretation of national legislation.

Public consultation

The consultation addresses issues such as the clarity and adequacy of legal terms used in the Directive, the need to modify exemptions, requirements for prior information, written confirmation, right of withdrawal, performance of distance contracts, and other questions including links to EU legislation on privacy and electronic communications.

Next steps

The consultation on Distance Selling will last until November 2006. A summary of responses will be published on the Commission’s website. In parallel, later this year the Commission will publish a Green Paper launching a broader consultation on other aspects of EU Consumer Protection legislation. These consultations will be pooled together to decide whether and how the Consumer regulatory framework should be revised.

For more information, see:

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