The Consumer Rights Directive

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The Consumer Rights Directive (the Directive) was agreed by all Member States of the European Union in October 2011.  It is not intended to centralise all of the various consumer rights legislation.

Instead, its aim is to harmonise the law governing consumer rights between Member States. The intention being that consumers will be more confident to buy across borders and therefore have greater choice available to them including access to the lowest prices.

According to Norman Lamb, former Consumer Affairs Minister, the Directive, "focuses on ensuring that consumers have the information and time they need to make good decisions, fully aware of all the costs they are committing to and any implications of entering into a contract."

Due to the aim of harmonisation, the UK Government has not been given much flexibility as to the implementation of the Directive.  It is therefore likely that it will be implemented by 'copying-out' the provisions into national law. 

This means keeping closely to the wording of the Directive without elaborating or 'gold-plating', which might put the UK at a competitive disadvantage.

The Directive is currently in a period of consultation that ends on 1 November 2012.  For details on how to have your say in the consultation please refer to the Department of Business Innovation & Skills website.

Member States must implement the Directive by 13 December 2013 and apply measures to do so by 13 June 2014.  The Directive will apply to contracts concluded after 13 June 2014.

The provisions of the Directive are currently anticipated to affect the following aspects of the business-to-consumer transaction:

  • whilst on the trader's premises it deals with what information needs to be given before a consumer buys goods or services and
  • whilst away from the trader's premises (at home or at a fair) or at a distance (internet, telesales, etc.) it deals with what information is to be given before a consumer buys goods or services and also with cancellation rights and responsibilities.

This will result in the following pieces of familiar legislation being affected by the Directive once it is implemented:

  • Sale of Goods Act 1979
  • Unfair Contract Terms Act 1977
  • Unfair Terms in Consumer Contract Regulations 1999
  • Consumer Protection (Distance Selling) Regulations 2000
  • Electronic Commerce (EC Directive) Regulations 2002
  • The Cancellation of Contracts made in a Consumer's Home or Place of Work etc Regulations 2008. (Doorstop Selling Regulations), and
  • Provision of Services Regulations 2009.

Given that most businesses dealing with consumers will be affected, now is the time to have your say – either by taking part in the consultation individually or as part of a trade association submission.

The implementation of this Directive is not the only proposed change to the law on consumer rights.  As can be seen by the volume of aforementioned regulations and legislation, the law on consumer rights is complex and cumbersome.

It was therefore envisaged following a variety of reports by the Law Commission over the last few years that there would be a UK Bill of Consumer Rights that would update, clarify and consolidate the law on: goods and services, digital content, unfair contract terms and consumer protection, in particular reforming consumer redress for misleading and aggressive practices.  

Most of these reforms are currently on hold until the Directive has been implemented.  It will be interesting to see which of the proposed reforms will materialise in the UK if the Government 'copies-out' the Directive as planned.

However, the Law Commission is currently in consultation about reforms to the law in the UK on unfair contract terms in consumer contracts.  The consultation period ends on 25 October 2011.  

For details about how to take part in the consultation please visit the Law Commission website.