James Netto Introduction Article 12 of TFEU Consumer protection requirements shall be taken into account in defining and implementing other Union policies and activities Article 169 In order to promote the interests of consumers and to ensure a high level of consumer protection t ID: 537166
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Slide1
Withdrawal rights and their impact on domestic law
James NettoSlide2
Introduction
Article 12 of TFEU:
“Consumer protection requirements shall be taken into account in defining and implementing other Union policies and activities.”
Article 169: “In order to promote the interests of consumers and to ensure a high level of consumer protection, the Union shall contribute to protecting the ...economic interests of consumers, as well as to promoting their right to information, education and to organise themselves in order to safeguard their interests.”Centred around the idea of guaranteeing the autonomy of the individual on the market without profit-making intentions.Focused on:Consumer’s freedom of choice and decisionProtection of legitimate expectationsRight to seek information and access to justiceRight to withdrawSlide3
What is the right of withdrawal?
“A right of withdrawal gives the consumer the possibility, without giving any reasons and without incurring any penalty, of no longer being bound by a contract” (
Ius Commune Casebooks – Consumer Law
)Enhances the right to self-determination and protects the freedom to contractSlide4
Does the right of withdrawal violate “pacta sunt servanda
”?
“The principle of autonomy of the will is not a purely formal principle...in certain cases, only the right of withdrawal permits the consumer to exercise this responsibility.
But if, once the period for withdrawal has lapsed, he did not revoke the decision that was formally taken, ‘pacta sunt servanda’. Instead of contradicting this principle, the right of withdrawal...gives the principle an additional justification...”. (Stauder – Pacta sunt Servanda and the Right of Withdrawal)Thus, merely a more refined more version of the principle is seen in the right of withdrawal. Slide5
Situations for the right of withdrawal
Broadly distinguished between two groups of cases:
Psychological Deficit
Not in a position to take a rational decision through aggressive sales practicesInformation AsymmetryHeld to have insufficient information to take a well-considered decisionSlide6
Examples
Germany
Distance learning contracts (
§4 FernUSG)Insurance contracts (§8 VVG)Consumer credit contracts (§7 VerbrKrG)FranceDating agencies and languages courses (Art L 311-15 Code de la consommation)Purchase and construction of a house (Art L 271-1 Code de la construction et de l’habitation)SpainPackage holidays (Art 9.4 of the Law 21/1995)Netherlands
Immovable property (Art 7:2 NBW)UKConsumer credit contracts (
Trading Standards Acts)Slide7
Harmonisation of the right of withdrawal in Europe
Attempted regulation and harmonisation:
Doorstop Selling Directive; Timeshare Directive; Distance Selling Directive; Life Assurance Directive; Consumer Credit Directive
Use of differing terminology, cooling-off periods, notice periods etc. have led to complications and differences across sectors.Harmonisation has also been problematic when the domestic framework for making contracts is analysed.Slide8
Impact of EU law: Germany
§355 ff BGB, §361a and b were harmonised in line with the right of withdrawal regulations from Europe.
Bundesgerichtshof: contracts were not fully valid until the right of withdrawal expired. Until then:
schwebend unwirksam – pending.As a result of the pending status, the consumer was only entitled to performance once the contract was fully valid. Slide9
Impact of EU law: Germany
Significant problems: academics – consumer should be allowed to refrain from his right to withdraw to be able to claim immediate performance.
Current law: Distance selling contracts are fully valid from beginning, and invalidated later by the consumer.Slide10
Impact of EU law: France & England
France
: Relevant codification: Contract not complete until the period of withdrawal has lapsed
Yet: academics have argued otherwise: R Baillod – Le droit de repentir (1984)England: Regulated in turn by different Acts of ParliamentSlide11
Conclusion: Reform and the future
Such disparities and inconsistencies in this field are of concern:
Position of the European Union
:“The Commission will examine the possibility and desirability of harmonising the method of calculating the cooling-off period under existing consumer-protection legislation” – European Council and ParliamentCommunication from the Commission to the European Parliament and the Council – A more coherent European contract law – An action plan.UK Law Society: (Law Society position - Consumer Rights Directive - 28 February 2009)“opposed to full harmonisation as a general rule, not least because it entails a decrease in the level of protection. For example, it would remove the right to reject as a remedy in the first instance.”“opposed to the narrow immediate emergency exception to the withdrawal period in the case of off-distance premises contracts. It would be a disincentive to, among others, solicitors making home visits for those ill or housebound and limit consumer’s freedom of choice and access to justice.”
Academia: the DCFR and Acquis
Group. Conclusion