Today on 2 March, the Competitiveness Council adopted its general approach on the proposal amending Directive 2011/83/EU (CRD) concerning financial services contracts concluded at a distance and repealing Directive 2002/65/EC. Particularly relevant for the digital commerce sector is the fact that the text goes well beyond the boundaries of the financial services contracts by introducing an extension of the obligation to display a “withdrawal button” for all transactions concluded at a distance by means of an online interface.
Currently, under the Consumer Rights Directive (CRD), consumers have a right of withdrawal of 14 days after the conclusion of a distance sale. The CRD offers retailers flexibility on how they proceed and inform consumers of their right. So far, this flexibility has been very beneficial to businesses who were able to develop their own withdrawal and return policy according to their specific business model and the consumers they serve. Furthermore, some businesses are even going beyond the legal obligations laid down by the CRD by providing a free return policy or by extending the 14-day period. In retail, we can observe consumers using their right of withdrawal on a daily basis and on a large scale, which is making the need for the proposed extension rather questionable.
Ecommerce Europe has been very concerned about the scope of this development and the far-reaching negative consequences for consumers and businesses across Europe. Since the text does not make any difference on the size of the companies or the sector of activity, this obligation to implement a withdrawal button will impact every business operating online. Such an obligation will be financially and technically burdensome for all, and more specifically for smaller businesses, which have fewer resources available to implement this significant obligation. While Ecommerce Europe approves and supports the broader goal of the legislation to improve consumer’s awareness of their right of withdrawal, this one-size-fit all solution should not be the way to go. Such a horizontal provision is expected to raise a myriad of technical problems since it will not be able to take into consideration the diversity of distance contracts as well as the online business landscape that the CRD provision is currently able to capture.
Finally, Ecommerce Europe is very concerned about the way the legislative process unfolded on this file. The rash extension of the withdrawal button to all distance contracts was added by the Czech presidency thus deviating from the initial focus of the European Commission’s proposal on financial services. This addition and the consequent rushed negotiations left no room for proper impact assessment and consultation of stakeholders, which is a necessity for such an important change in the legislation. The European Commission is currently in the process of conducting an extensive fitness check of the existing EU consumer law framework and we consider the latter a more appropriate venue for further discussions on this issue.
At the moment, the European Parliament is still in the process of negotiating this file under the lead of Member of the European Parliament (MEP) Arba Kokalari (EPP, Sweden) within the IMCO Committee, which is expected to vote on the compromise text on 27-28 March. Some disagreements between MEPs could still result in a partial rewording of the proposed obligation. Once the co-legislators are set on their respective final positions, the text will go into negotiations in trialogues with the European Commission who also spoke out in favour of introducing a withdrawal button.
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