Chambers Ireland Seeks Feedback on Impact of Consumer Rights Directive on Business

Chambers Ireland, in partnership with Eurochambres, is taking part in a project known as the “Burden Tracker”, which aims to identify pieces of legislation that are burdensome for SMEs and subsequently alert policy makers to their negative impact.

They wish to feedback and comments from businesses regarding their views on the impact of the Consumer Rights Directive on their business and whether it could be reformed to be more SME-friendly.

Amongst the chief concerns held by businesses across Europe is legal uncertainty, enormous bureaucracy and excessive regulatory burdens for companies, especially SMEs, with particular reference to off-premises contracts and distance contracts.

Why we need your support

Identified Legislation:     Consumer Rights Directive

  • As part of the process, Chambers Ireland worked with Eurochambres through 2015 to identify pieces of legislation that could be deemed “burdensome” to SMEs. After reaching out to companies and Chambers across the European Union, it was decided that it would be most beneficial to SMEs to focus on one piece of legislation with the aim of reforming it to make it more SME friendly.
  • The Consumer Rights Directive ((2011/83/EC)) was chosen.
  • The Consumer Rights Directive, which entered into force in June 2014, aims to harmonise national consumer rules in several important areas, such as the information consumers need before they purchase goods and services, and their right to cancel online purchases.
  • Based on feedback from Chambers and businesses from across Europe, questions have been raised as to the additional unnecessary burdens the Directive causes for SMEs.
  • For example, companies noted legal uncertainty enormous bureaucracy and excessive regulatory burdens for companies, especially SMEs, with particular reference to off-premises contracts and distance contracts

Why is the legislation burdensome?

Off-premises contracts (contracts concluded outside the trader’s business premises)

  • Research has shown that the enormous information requirements required by the Directive can be very burdensome for traders. Additionally, this burden is compounded by the fact that the burden of proof that information has been provided falls on businesses.

One of the examples where this issue has been identified as particularly burdensome concerns a trader’s obligation to inform consumers of the manufacturer’s warranty, which causes an excessive burden for traders with a wide range of products (as in the case of distance contracts).

Moreover, the extension of information requirements introduced by the Consumer Rights Directive does not necessarily result in consumers being provided with appropriate information. On the contrary, consumers are often confronted with the problem of “information overload”.

  • Complexity of the withdrawal forms, which makes it hard for a craftsman to make a clear distinction between service and sales contracts. This problem is particularly significant because these types of contracts have different provisions regulating the right of withdrawal,.

Distance contracts (contracts concluded using distance communication)

  • Excessive extension of information requirements, including pre-contractual information requirements on warranties and the information obligations on the right of withdrawal, that mean burden and legal uncertainty for the affected companies.
  • Legal uncertainty on how pre-contractual information requirements can be accomplished correctly, with particular reference to the distinctions introduced in relation to the withdrawal period.
  • Legal uncertainty regarding the extent to which the main characteristics of a good or service must be outlined before placing an order.
  • The provisions on the design of distance contracts on digital content are considered to bear a high legal uncertainty and to make downloads bureaucratic.

What we need from Shannon Chamber members:

  • Examples and anecdotal evidence to corroborate the above.
  • Estimates of additional costs incurred as a consequence of the directive, either by specific businesses, or on average.
  • Companies who are willing to provide testimonials

Deadline:  28th April 2016

Email feedback and testimonials to hdownes@shannonchamber.ie

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