Same level of penalties across Member States for breaches of consumer laws planned

Article written by Duncan Barry – Media and Information Executive, MEUSAC
Published on The Malta Independent – 02.04.18

An information session on consumer rights and the proposed amendments of consumer right’s directives was organised by MEUSAC in conjunction with the Malta Competition and Consumer Affairs Authority (MCCAA) on March 27.

Following a number of fitness checks conducted over a period of a year and a half on current consumer laws, it results that the laws are still “fit for purpose” as existing rules adequately tackle the problems that European consumers face even on online markets. However, there is further room for improvement in specific areas.

Odette Vella, Information, Education and Research Director at MCCAA, spoke about the new proposals which will enhance consumer rights across Member States, including Malta. She said that a number of amendments and proposals have been made to ensure a fair balance between consumer protection and traders’ interests.

One of the main problems that these amendments address are the divergences when it comes to penalties imposed by Member States, where some Member States impose harsher fines than others. For instance, in one country the maximum fine does not exceed €9,000 while in another Member State it goes up to some five million euro – a massive difference. Current penalties do not take into consideration the fact that a breach of consumer law has taken place in more than one Member State either. This is expected to change through harmonised penalties.

More transparency for contracts concluded on online marketplaces

The European Commission is proposing better protection for consumers by ensuring transparency of sales contracts concluded on online marketplaces. Consumers need to be properly informed about who they are concluding the sales contract with, whether it is the marketplace itself or a third party. If it is a third party, consumers will then need to be informed if the third party is a trader or an individual. With such information, consumers would know if the purchase they are about to make is covered by EU consumer laws or not.

With regards to “free” digital services it results that consumers do not get these services for free after all as they pay through the personal data they provide when subscribing to a service. Currently, there is no obligation to provide consumers with information about interoperability of service with hardware and software and, hence, whether the material they are about to download may harm their computer. Therefore, the proposals aim to extend the scope of the Consumer Rights’ Directive to include “free” digital services so that suppliers of such services will be obliged to provide pre-contractual information about the service and also to give subscribers the right of withdrawal, that is the right to terminate a contract within 14 days.

The New Deal for Consumers Package is also proposing to revise the Injunctions Directive to fully exploit the potential of injunctions by addressing the main problems faced by consumers in obtaining redress. The proposed revisions also have the objective of diminishing significant disparities among Member States in the level of the use of the injunctions procedure and its effectiveness, and to include Collective Redress in the provisions of this Directive.

One of the proposed amendments is that of enlarging the scope of the Injunctions Directive to all EU legislation relevant for the collective interests of consumers and to complement action for injunctions with compensatory collective redress.  Another proposed amendment is that of ensuring the presence across the EU of a collective redress mechanism as representative action by qualified entities.

Seeking redress – Malta’s case

Consumers in Malta have always had the possibility of turning to the MCCAA as the Authority concerned to file a complaint and to be provided with the required assistance to reach an amicable agreement with the trader. In the event that such an agreement is not found, Maltese consumers can opt to seek redress through the Consumer Claims Tribunal if their claim does not exceed €3,500. If their claim exceeds this amount then they may proceed with their case through the Civil Courts.

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