European consumer law concerns

consumer protection Consumer protection is the practice of safeguarding buyers of goods and services, and the public, against unfair practices in the marketplace. Consumer protection measures are often established by law. Such laws are intended to prevent business ...

within Europe, particularly through

European Union law European Union law is a system of Supranational union, supranational Law, laws operating within the 27 member states of the European Union (EU). It has grown over time since the 1952 founding of the European Coal and Steel Community, to promote ...

and the

European Convention on Human Rights The European Convention on Human Rights (ECHR; formally the Convention for the Protection of Human Rights and Fundamental Freedoms) is a Supranational law, supranational convention to protect human rights and political freedoms in Europe. Draf ...

. Article 169 of the

Treaty on the Functioning of the European Union The Treaty on the Functioning of the European Union (TFEU) is one of two treaties forming the constitutional basis of the European Union (EU), the other being the Treaty on European Union (TEU). It was previously known as the Treaty Establish ...

enables the EU to use its

ordinary legislative procedure The European Union adopts legislation through a variety of procedures. The procedure used for a given legislative proposal depends on the policy area in question. Most legislation needs to be proposed by the European Commission and approved by ...

to protect consumers "health, safety and economic interests" and promote rights to "information, education and to organise themselves in order to safeguard their interests". All member states may grant higher protection, and a "high level of consumer protection" is regarded as a fundamental right. Consumers are entitled to a legislative "charter of rights" to safe and healthy products, fair terms, proper information free from misleading advertising and marketing, and rights of cancellation. Beyond these general principles, and outside specific sectors, there are four main Directives: the

Product Liability Directive 1985 The Product Liability Directive''85/374/EECis a directive of the Council of the European Communities (now the European Union) which created a regime of strict liability for defective products applicable in all member states of the European Union, ...

, Unfair Terms in Consumer Contracts Directive 1993, Unfair Commercial Practices Directive 2005 and the

Consumer Rights Directive 2011 The Consumer Rights Directive 2011/83/EU is a consumer protection measure in EU law. It was due to be implemented by 13 December 2013. Scope The Directive applies to most contracts between traders and consumers and applied to all contracts concl ...

, requiring information and cancellation rights for consumers. As a whole, the law is designed to ensure that consumers in the EU are entitled to the same minimum rights wherever they make their transactional decisions, and largely follows inspiration from theories of consumer protection developed in California, and the

Consumer Bill of Rights On March 15, 1962, President John F. Kennedy presented a speech to the United States Congress in which he extolled four basic consumer rights, later called the Consumer Bill of Rights. The United Nations through the United Nations Guidelines for ...

proclaimed by John F. Kennedy in May 1962. The

European Court of Justice The European Court of Justice (ECJ), officially the Court of Justice (), is the supreme court of the European Union in matters of European Union law. As a part of the Court of Justice of the European Union, it is tasked with interpreting ...

has continually affirmed the importance of ensuring more consumer rights than in commercial contracts, both because of

information asymmetry In contract theory, mechanism design, and economics, an information asymmetry is a situation where one party has more or better information than the other. Information asymmetry creates an imbalance of power in transactions, which can sometimes c ...

, and inequality of bargaining power.See '' Banco Español de Crédito SA v Camino'' (2012
Case C-618/10
9and ''Océano Grupo Editorial and Salvat Editores'' (2000) C-240/98 to C-244/98 and

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ECR I-4941, 5/ref>

History

The

was the first consumer protection measure. It creates

strict In mathematical writing, the term strict refers to the property of excluding equality and equivalence and often occurs in the context of inequality and monotonic functions. It is often attached to a technical term to indicate that the exclusiv ...

enterprise liability for all producers and retailers for any harm to consumers from products, as a way to promote basic standards of health and safety. Any producer, or supplier if the ultimate producer is

insolvent In accounting, insolvency is the state of being unable to pay the debts, by a person or company ( debtor), at maturity; those in a state of insolvency are said to be ''insolvent''. There are two forms: cash-flow insolvency and balance-sheet in ...

, of a product is strictly liable to compensate a consumer for any damage caused by a defective product. A "defect" is anything which falls below what a consumer is entitled to expect, and this essentially means that products should be safe for their purpose. A narrow defense is available if a producer can show that a defect could not be known by any scientific method, thought this has never been successfully invoked, because it is generally thought a profit making enterprise should not be able to externalise the risks of its activities. The Unfair Terms in Consumer Contracts Directive 1993 was the second main measure. Under article 3(1) a term is unfair, and not binding, if it is not "individually negotiated, and "if, contrary to the requirement of

good faith In human interactions, good faith () is a sincere intention to be fair, open, and honest, regardless of the outcome of the interaction. Some Latin phrases have lost their literal meaning over centuries, but that is not the case with , which i ...

, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer". The Court of Justice has continually affirmed that the Directive, as recital 16 states, "is based on the idea that the consumer is in a weak position vis-à-vis the seller or supplier, as regards both his

bargaining power Bargaining power is the relative ability of parties in a negotiation (such as bargaining, contract writing, or making an agreement) to exert influence over each other in order to achieve favourable terms in an agreement. This power is derived f ...

and his level of knowledge". Terms which are very skewed, are to be conclusively regarded as contrary to "

" and therefore unfair. For example, in '' RWE AG v Verbraucherzentrale NRW eV'', clauses in gas supply contracts enabling the German utiliies company RWE to vary unilaterally prices were stated by the

to be insufficiently transparent, and therefore unfair. In '' Brusse v Jahani BV'' the

Court of Justice of the European Union The Court of Justice of the European Union (CJEU) ( or "''CJUE''"; Latin: Curia) is the Judiciary, judicial branch of the European Union (EU). Seated in the Kirchberg, Luxembourg, Kirchberg quarter of Luxembourg City, Luxembourg, this EU ins ...

advised that clauses in a tenancy contract requiring tenants pay €25 per day were likely unfair, and would have to be entirely void without replacement, if they were not substituted with more precise mandatory terms in national legislation. In '' Aziz v Caixa d'Estalvis de Catalunya'', after the

2008 financial crisis The 2008 financial crisis, also known as the global financial crisis (GFC), was a major worldwide financial crisis centered in the United States. The causes of the 2008 crisis included excessive speculation on housing values by both homeowners ...

, the

advised that even terms regarding repossession of homes in Spain had to be assessed for fairness by national courts. In '' Kušionová v SMART Capital a.s.'', the

held that consumer law was to be interpreted in the light of fundamental rights, including the

right to housing The right to housing (occasionally right to shelter) is the economic, social and cultural right to adequate house, housing and shelter (building), shelter. It is recognized in some Economic, social and cultural rights#National constitutions, nat ...

, in the event that a home could be repossessed. Because consumer law operates through Directives, national courts have the final say on applying the general principles set out by the

's case law. The EU's Directive 98/6/EC, published on 16 February 1998 with a transposition deadline of 18 March 2000, was concerned with "consumer protection in the indication of the

price A price is the (usually not negative) quantity of payment or compensation expected, required, or given by one party to another in return for goods or services. In some situations, especially when the product is a service rather than a ph ...

s of products offered to consumers". The European Commission announced a "New Deal for Consumers" in April 2018, which put forward plans to strengthen consumer law and the coordination of consumer rights enforcement by national authorities. The "new deal" involved updating the directives on unfair terms in consumer contracts, price indications, unfair business practices and consumer rights, along with a proposal to replace the existing injunctions directive with a directive on " representative actions for the protection of the collective interests of consumers".

References

{{reflist

External links

EU Commission consumer page
Product liability Consumer protection law European_Union_consumer_protection_law

History

See also

Human rights

Product safety

Unfair terms

Information and withdrawal

Marketing

Specific sectors

Other business regulation

General

References

External links