"This law marks a big step forward for consumers and for EU competitiveness. It boosts the protection consumers enjoy across the EU, while simplifying the regulatory environment for businesses," said Health and Consumer Protection Commissioner Markos Kyprianou.
According to the Commission, consumers' rights will be clearer and cross-border trade made simpler under the Directive, which establishes a single, common, general prohibition of unfair commercial practices distorting consumers' economic behaviour.
This single set of common rules will replace the existing multiple volumes of national rules and court rulings on commercial practices, which make it difficult and confusing for businesses. The Commission hopes that it will also boost consumer confidence and consequently, cross-border trade.
The Directive lays down rules for determining whether a commercial practice is unfair. Its aim is to define a limited range of "sharp practices" which are prohibited EU-wide. These include:
- Pressure selling;
- Implying that the consumer cannot leave the shop until they sign a contract;
- Conducting personal visits to the consumer's home and ignoring the consumer's request to leave or not to return;
- Misleading marketing;
- Claiming to be a signatory to a code of conduct when the trader is not; and
- Describing a product as "gratis", "free", "without charge" etc. if the consumer has to pay anything other than unavoidable delivery or collection costs – premium rate scams, for example.
It also lays down general principles which can be used to assess whether other types of practices should be prohibited as unfair.
The key test, in most cases, is whether the practice would unfairly distort the behaviour of the 'average' consumer – in other words, practices that impact on decisions such as whether or not to buy a product, and if so from whom. It also covers behaviour that might influence consumers' decisions on whether or not to exercise a right under a contract with a business, such as making a claim on an insurance policy for instance, or exercising a right to return goods, withdraw from a loan contract or end a subscription.
There are also provisions aimed at preventing exploitation of particularly vulnerable consumers.
The Directive does not cover businesses' dealings with other businesses. Nor does it cover any matters of taste or decency, health and safety or contract law.
