Health and Consumer Protection Commissioner David Byrne
said:
"This Directive provides for enhanced
consumer protection in the important and often complex area of
marketing financial products. It complements and underpins the
E-commerce Directive, making it easier for businesses to operate
under legal certainty and for consumers to make transactions with
confidence. Winning consumer confidence is the key to opening up
the financial services market across national borders to the
benefit of European consumers through increased competition and
choice."
The Directive fills a gap in existing consumer protection
legislation, left by the exclusion of financial services from the
1997 Directive on distance selling. Its main features are:
- the prohibition of abusive marketing practices seeking to
oblige consumers to buy a service they have not solicited (known as
"inertia selling");
- rules to restrict other practices such as unsolicited phone
calls and e-mails (i.e. cold-calling and spamming);
- an obligation to provide consumers with comprehensive
information before a contract is concluded; and
- a consumer right to withdraw from the contract during a
cool-off period - except in cases where there is a risk of price
fluctuations in the financial market.
The agreed text sets out two options for rules Member States are
to apply with respect to the use of cold-calling and spamming.
Under the first option ("opt-in"), cold calling and spamming are
prohibited unless the consumer has expressly consented; under the
second option ("opt-out"), this is prohibited only if the consumer
has signalled his/her objection, e.g. by entering his/her name on a
register set up for this purpose.
Sellers of financial services and products will also be obliged
to provide consumers with comprehensive information before a
contract is concluded.
This information should include the identity, contact details
etc. of the supplier, the price and payment arrangements,
contractual rights and obligations as well as information about the
performance of the service offered. Information on the technical
quality and nature of the financial service must be also provided
in accordance with the rules of the "vertical" directives on
credit, insurance and investment services or with relevant national
rules for services not currently subject to EU legislation.
Consumers will also have the right to cancel a contract within
14 days after signing up, extended in the case of life insurance
and pension plans to 30 days. This right will not, however, apply
to financial services that may be subject to fluctuations in the
financial market, such as sales of foreign currency and
securities.
Member States may also exclude mortgage or property credit from
this right of withdrawal from a contract. In addition, in the event
of fraudulent use of payment cards or other non-cash means of
payment consumers will be able to cancel transactions and be
entitled to reimbursement of any sums charged.
The Directive will now go back to Council for final
adoption.
The Recommendation approved by Parliament yesterday
