Rethinking EU Consumer Law

Geraint Howells, Christian Twigg-Flesner, Thomas Wilhelmsson

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351675321
• Edition: 1
• Topic: Jura
• Subtopic: Rechtstheorie & -praxis

In Rethinking EU Consumer Law, the authors analyse the development of EU consumer law on the basis of a number of clear themes, which are then traced through specific areas. Recurring themes include the artificiality of the EU's consumer image, the problems created by the drive towards maximum harmonisation, and the unexpected effects EU Consumer Law has had on national law. The book argues that EU Consumer Law has the potential of enhancing the protecting of consumers throughout the EU and could offer a model for consumer law elsewhere in the world, but in order to unlock this potential, there needs to be a rethink with regard to the EU's approach to consumer law and policy.

1The rich canvas of EU consumer law

An introduction

Introduction

This book provides the reader with a critical analysis of the development and current state of EU consumer law as well as proposals for its future development. The EU has been exceptionally active in the consumer protection field. Almost all areas of consumer law (from advertising and marketing through contract and tort law rules to enforcement and redress) have been touched by EU law. EU consumer law is a subject of broad scope and some careful selection of topics has been necessary. This text concentrates on the traditional core areas of safety, contract law including credit, commercial practices and access to justice. Some areas, such as food and financial services regulation, have been excluded because they have become so complex at the EU level that they are topics in their own right. The same might also be said of travel law. This is not considered as a specific topic in this book, but several of the measures are used to illustrate key points. Other topics beyond the scope of our analysis are the consumer effects of competition law,¹ as well as services of general interest² and telecommunications. The latter two fields in particular are becoming more important and may challenge the application of the traditional principles of consumer protection.

Looking forward, the consumer marketplace is likely to evolve rapidly. A subject and body of legislation formed in the era of the development of mass consumer markets for cars and white goods is developing fast and being driven by increased consumer affluence and technological developments. The service sectors are growing, and the digital revolution is likely to spawn both new products and new ways of delivering them. This is an ideal time to review the development of EU consumer law to check that its fundamental values are fit for purpose. These will be tested moving forward to see if they are appropriate for the new challenges facing the global, digital and service-oriented consumer market.

Additional scrutiny of the robustness of EU consumer law might come from the UK. Following the referendum in June 2016, the UK will cease to be a member of the EU although the details of this process and the UK’s future relationship with the EU remain unclear. Depending on the outcome of the negotiations, the UK might gain the freedom to develop a more independent consumer policy. The UK has always had a strong focus on consumer protection law, evidenced by recent reforms to its consumer legislation.³ The UK may decide to tackle emerging challenges for consumer protection differently from the EU. However, it is likely that EU law will remain highly influential on the development of UK consumer law, at least in the medium term, and this book will have continued relevance for UK readers. What is clear is that there are many reasons why the quality of EU consumer law will be under continued and probably intensified scrutiny.⁴

The starting point for the analysis in this book is our belief that European consumer law and policy in recent times have risked over-emphasising the internal market goal.⁵ There is a need to develop a philosophy to underpin its consumer protection policy. This should include a continued adherence to market transparency so consumers can be confident actors in the market and so help drive up standards by being part of a competitive environment. However, the EU policy needs to have more depth and an appreciation of the social welfarism goals of consumer policy. In part this involves protecting the vulnerable. This is occasionally reflected in the current acquis;⁶ but there is little critical analysis of the concept of vulnerability or how to address the problems it gives rise to. However, any consumer policy also needs to recognise all consumers are subject to limitations when acting on the market. There is growing recognition of the important lessons for consumer law from behavioural economics in this regard,⁷ particularly in the context of applying the Unfair Commercial Practices Directive.⁸ One function of the law should be to share risks so that all consumers can expect their purchases fulfil certain legitimate expectations. An effective consumer law is also compatible with the interests of good traders and should promote the EU brand and raise its international competitiveness.

Our analysis is underpinned by a number of key themes. We develop these in this chapter. Our analysis of specific fields within EU consumer law will then develop these further.

1The balance between internal market and consumer protection objectives has swung too much in favour of market integration by the overstatement of the case for maximum harmonisation.

2	A high level of consumer protection is desirable not only for consumers but to enhance the international competitiveness of the ‘European brand’.
3	The EU approach to consumer protection risks being viewed as insufficiently protective due to its adoption of the average consumer standard and an information-based protection model which has not been developed in a sophisticated manner taking into account the lessons of behavioural economics.
4	EU consumer law should be more explicit in recognising that it has a social welfare function of redistributing risk.
5	EU legislation should be in a form which allows the EU rules to be integrated into national regimes and parallel regimes for cross-border sales should only be introduced where there are good justifications.

6The EU needs to ensure laws are effectively enforced.

The balance between internal market and consumer protection objectives has swung too much in favour of market integration by the overstatement of the case for maximum harmonisation

There has always been a tension between the avowedly consumer protection motivations of the EU when enacting the consumer acquis and the more utilitarian objective of enhancing the internal market by creating a level playing field for technical, administrative and private law regulation.⁹ As the next section illustrates, this is inevitable given the legal base on which most of the acquis is founded. However, there have been some subtle (and other less subtle) changes in emphasis and policy in recent years.¹⁰ This was marked most obviously by the increased preference for maximum harmonisation directives. In the early days of EU consumer law the internal market criterion was met by mainly minimum harmonisation laws that sought to give consumers the confidence to shop anywhere in the EU marketplace.¹¹ Nowadays, this is no longer seen as sufficient. Instead businesses are considered to need the confidence that they will not be surprised by legal provisions when selling abroad.¹² Maximum harmonisation is the order of the day. This legal policy change has been underpinned by an institutional reshuffling of the cards away from the old Directorate-General on Health and Consumer Protection (DG SANCO), with most areas of EU consumer law now being handled by DG JUST (Justice and Consumers).

This faith in the level playing field as a motor for deeper integration seems misguided. EU regulation is rarely complete. It leaves gaps either expressly (e.g. with regard to sanctions and remedies) or by default due to the limited scope of the measures. These lacunae have to be filled by national law. Moreover, many EU provisions contain open-textured clauses which allow for different national legal and cultural interpretations.¹³ Indeed national traditions of enforcement and styles of interpretation mean that the cross-border trader can never be assured that the law in practice will be the same in every state whatever the law books say. A false sense of security can be created if producers and consumers are led to believe the law is identical in substance and application throughout the Community. Moreover, there are many other factors more directly influencing decisions to buy and sell across borders than the substantive law, such as language, convenience, delivery costs and access to redress.

Maximum harmonisation is seen as an attack on some higher levels of protection that historically exist in some Member States. For example, under the maximum harmonisation approach adopted in the original proposal for a Consumer Rights Directive,¹⁴ the ability of Nordic states to control core terms, or the rights of consumers in some states immediately to reject non-conforming goods without allowing an attempt to cure, would have been lost. This was one reason why the measure was scaled back by the removal of sale of goods and unfair terms rules. This episode adversely affected the image of the EU as a champion of consumer rights.

A high level of consumer protection is desirable not only for consumers but to enhance the international competitiveness of the ‘European brand’

Our view is that creating high minimum standards that lead to gradual convergence is the best way forward. It is a credit to Europe that consumer lawyers now all use a common terminology¹⁵ and there has been a high degree of legal convergence. Maximum harmonisation seeks to push this further, but for relatively small gains and at ...