Consumer protection policy: principles and instruments
Consumer protection policy: principles and instruments
Legal basis
Articles 4(2)(f), 12, 114 and 169 of the Treaty on the Functioning of the European Union (TFEU) and Article 38 of the Charter of Fundamental Rights of the European Union.
Objectives
In order to promote their interests and ensure a high level of protection, the Union must contribute to protecting the health, safety and economic interests of consumers. In addition, the Union must promote consumers' right to information and education and their right to organise themselves in order to protect their interests. Consumer protection must be integrated into all relevant policy areas of EU legislation.
Actions
A. General
The EU Consumer Policy Action Programme builds on the New Consumer Agenda, adopted on 13 November 2020. The Agenda sets out an updated vision for EU consumer policy for the period 2020-2025, with the subtitle "Strengthening consumer resilience for sustainable recovery". It also aims to address immediate consumer concerns about the COVID-19 pandemic.
The agenda covers five key priority areas:
Green transition: overcoming new challenges to consumer rights and harnessing the empowering opportunities that the green transition presents, ensuring that sustainable products and lifestyles are accessible to all, regardless of geographic location or income;
Digital transformation: creating a safer digital space for consumers, where their rights are protected, and ensuring a level playing field to enable innovation to deliver newer and better services to all Europeans;
effective enforcement and redress: tackling the impact of the COVID-19 pandemic on consumer rights and eliminating misleading environmental lies and unfair commercial practices in online influencing and personalisation techniques; although enforcement of consumer rights is primarily the responsibility of national authorities, the EU plays an important coordinating and supporting role, underpinned by the Regulation on consumer protection cooperation;
responding to the specific needs of consumers: taking into account the needs of consumers who, in certain situations, may be vulnerable and require additional safeguards; this may be determined by social circumstances or specific characteristics of individuals or groups of consumers;
consumer protection in the global context: guaranteeing the safety of imports and protecting EU consumers against unfair practices by non-EU operators through market surveillance and closer cooperation with the relevant authorities in EU partner countries.
The EU institutions systematically monitor consumer protection policy through the Consumer Scoreboard, which monitors national consumer conditions in three areas (knowledge and trust, compliance and enforcement, and complaints and dispute resolution) and reviews progress in integrating the EU retail market, based on the level of cross-border business-to-consumer transactions and the development of e-commerce. Consumer policy is also systematically monitored using the Consumer Markets Scoreboard, which collects recent purchase data from consumers to track the performance of over 40 consumer markets against key indicators such as confidence that sellers comply with consumer protection rules, comparability of offers, the options available in the market, the extent to which consumer expectations are met and the harm caused by problems faced by consumers.
In addition, on 28 April 2021, the Single Market Programme was launched, with the aim of helping the single market reach its full potential and ensuring Europe's recovery from the COVID-19 pandemic. With a budget of €4.2 billion for the period 2021-2027, the programme provides an integrated package to support and strengthen the governance of the Single Market, including financial services.
B. Sectoral measures (2.2.2)
1. Consumer groups
The involvement of groups representing consumer interests in the EU is a priority for the EU institutions. The European Consumer Consultative Group (ECCG) is the main forum used by the Commission to consult with national and European consumer organisations. Established by Commission Decision 2009/705/EC, the ECCG can provide the Commission with advice and information on any issue related to the protection of consumer interests at EU level. In 2017, the Parliament and the Council adopted Regulation (EU) 2017/826 establishing a Union programme to support specific activities enhancing the involvement of consumers and other end-users of financial services in Union financial services policy making for the period 2017-2020.
2. Consumer education
The EU has organised consumer education actions at various levels, for example through the gradual inclusion of consumer education in primary and secondary school curricula. One such initiative is the Consumer Classroom, a pan-European and multilingual EU website for teachers. The site brings together an extensive library on consumer education from across the EU and provides interactive and collaborative tools for preparing lessons and making them available to learners and other teachers. The online interactive consumer education tool "Dolceta" has been designed for trainers and teachers as well as consumers and covers, among other things, basic consumer rights, product safety and basic financial education.
3. Consumer information
If consumers were better informed and more knowledgeable about their rights, they could be more confident. The EU has set up European Consumer Centres (ECC-Net) to provide information and advice on cross-border shopping and to deal with consumer complaints. A parallel network called FIN-NET fulfils the same role for complaints about cross-border financial services. The Commission also organises consumer information campaigns in the Member States and publishes practical guides for consumers. SOLVIT is a service dedicated to resolving disputes arising from breaches of EU law.
The Your Europe portal plays an important role, providing access to better information on consumer policy and bringing together different sources of information in a one-stop information centre. Access to information has been improved with a single digital portal (Regulation (EU) 2018/1724).
On 30 March 2022, as part of the circular economy package, the Commission published a proposal for a directive on strengthening the role of consumers for the green transition through better protection against unfair practices and better information. The main objective of the proposal is to encourage consumers to make green choices by providing them with the necessary information.
4. Ensuring that consumer rights are respected
Ensuring the effective and fair enforcement of consumer rights is as important as their existence. Responsibility for ensuring that they are respected lies primarily with national public authorities. Regulation (EU) 2017/2394 on cooperation between national authorities responsible for the enforcement of consumer protection laws brings these national authorities together in an EU-wide network, which provides a framework for information exchange and cooperation actions to combat any infringements of consumer protection laws (e.g. misleading advertising, package holidays or distance selling). The network also carries out coordinated investigations and enforcement activities, e.g. in the form of internet screening activities, during which authorities check whether websites comply with the law.
The role of the European Parliament
The Parliament is constantly working to improve consumer protection rules in the EU. Consumer protection policy has undergone a transition from a policy of technical harmonisation of standards to the completion of the internal market, becoming part of the effort to contribute to the objective of creating a "citizens' Europe". As a result of Parliament's legislative effort, since 13 June 2014, Member States have been implementing national laws transposing the Consumer Rights Directive, which was adopted by an overwhelming majority in Parliament.
On 12 December 2017, the Parliament adopted Regulation (EU) 2017/2394 on cooperation between national authorities responsible for the enforcement of consumer protection laws with the intention of improving the effectiveness of the rules and procedures on cooperation between national authorities responsible for the enforcement of consumer protection laws.
Following the Commission's proposal on new consumer benefits, on 27 November 2019, the Parliament adopted Directive (EU) 2019/2161 on better enforcement of Union consumer protection rules and modernisation of consumer protection rules. On 25 November 2020, the Parliament adopted Directive (EU) 2020/1828 on representative actions to protect the collective interests of consumers.
In addition to participating in the drafting of EU legislation, the Parliament sets the agenda for consumer policy by adopting own-initiative reports. Parliament has been particularly active in securing greater budgetary resources for consumer protection measures and developing consumer representation in Member States, especially those that joined the EU after 2004. On 13 September 2018, Parliament adopted a resolution on the quality differences that characterise some products on the single market, finding that these practices are discriminatory and contrary to consumer expectations.
On 25 November 2020, the Parliament adopted a resolution "Towards a more sustainable single market for businesses and consumers", stressing that it is important that consumer goods are durable and repairable and that consumers must be given more rights and information to help them make sustainable choices[1].
During the crisis caused by the COVID-19 outbreak, consumer protection has become essential to ensure reimbursement in case of cancellation of certain services and to combat the spread of misinformation and dishonest traders selling fake or non-compliant medical equipment at excessive prices. On 23 March 2020, the Internal Market and Consumer Protection Committee (IMCO) sent a letter to European Commission Executive Vice-President Margrethe Vestager, Commissioners Thierry Breton and Didier Reynders and the Croatian Council Presidency. The letter calls for more measures to be taken to combat the crisis caused by the COVID-19 pandemic and warns of the need for democratic oversight of the process. On 9 November 2020, the Thematic Department for Economic, Scientific and Quality of Life Policies organised a webinar[2] for the IMCO Commission on the impact of the COVID-19 pandemic on the internal market and consumer protection. It highlighted the effects of measures introduced at national and EU level to mitigate the negative consequences of the pandemic and made suggestions on further measures that could be taken to ensure the smooth functioning of the internal market both now and in the event of future crises. On 19 November 2020, Justice and Consumer Affairs Commissioner Didier Reynders presented the new consumer agenda to the IMCO Commission. The agenda examines the impact of the COVID-19 pandemic on consumers and deals with longer-term consumer policy issues related to the green and digital transition, responding to consumer vulnerabilities, effective enforcement of consumer rights and international cooperation with partner countries.
On 22 February 2021, a comprehensive study[3] on the impact of COVID-19 on the internal market was presented to the IMCO Commission. The study shows the impact of restrictions at Member State and EU level on the free movement of goods, services and persons. It makes policy recommendations on how future crises could be managed to allow free movement to continue, such as allocating funds for future vaccine development and procurement and continued coordination of relevant rules at EU level.
Consumer protection policy in the area of online and digital services is a topic on which Parliament, and in particular the IMCO Committee, has placed particular emphasis. In June 2020, a study[4] on the moderation of illegal content by online platforms, commissioned by the IMCO Committee, identified the need to tighten the EU legal framework, in addition to co-regulation by online platforms, to protect consumers from illegal or harmful online content. A study published in June 2021 analysed the impact of targeted advertising on advertisers, market access and consumer choice.
On 20 October 2020, the Parliament adopted three resolutions entitled "Digital Services Act: improving the functioning of the single market", "Digital Services Act and fundamental rights issues" and "Digital Services Act: adapting commercial and civil law rules for commercial entities operating online". With these resolutions, the Parliament set out its plan for ensuring the future functioning of the digital single market, including stricter consumer protection measures in the online environment. Much of the content of the own-initiative reports was included in the European Commission's proposals, which were successfully amended and voted in the IMCO Committee in December 2021 (2.1.7). The provisional political agreements reached in March and April 2022 on the Digital Markets Regulation and the Digital Services Legislative Act are essential for consumer protection in the digital environment.
On 27 September 2021, the IMCO Commission held a public hearing on consumer protection and automated decision-making tools in a modern economy. The hearing focused on solutions to protect consumers against the risks associated with the use of professional artificial intelligence services and smart products based on automated decision-making tools and highlighted solutions to improve the quality and quantity of information provided to consumers. Representatives of consumers, companies, certification bodies and academia presented their views on the current EU framework and the requirements that should be introduced to ensure a high level of consumer protection and trust. They also presented their views on the difficulties this would entail for firms and how compliance could be effectively ensured. IMCO members stressed that a trust-based environment must be created and expressed their views on how the current regulatory framework could be improved. In addition, in May 2022, the IMCO Commission held a public hearing on digital product passports: increasing transparency and consumer protection as a means of improving consumer information in a digitalised environment.
Furthermore, on 7 April 2022, the Parliament adopted a resolution on consumers' right to redress. The resolution pursues the dual objective of providing consumers with products that last longer and can be repaired. On 20 April 2022, the IMCO Committee held a public hearing on the enforcement of consumer rights when shopping outside the EU. The purpose of the hearing was to provide an overview of the situation of consumer rights when shopping outside the EU, for example on pre-contractual information and protection against unfair contract terms and practices.
[Keirsbilck, B. et al., "Sustainable Consumption and Consumer Protection Legislation", paper published for the Committee on the Internal Market and Consumer Protection, Thematic Department for Economic, Scientific and Quality of Life Policies, European Parliament, Luxembourg, 2020.
[2]Milieu Consulting SRL, "The impact of COVID-19 on the Internal Market and consumer protection - IMCO Webinar Proceedings", paper published for the Committee on the Internal Market and Consumer Protection, Thematic Department for Economic, Scientific and Quality of Life Policies, European Parliament, Luxembourg, 2020.
[3]Marcus, J. S. et al, "The impact of COVID-19 on the Internal Market", paper published for the Committee on the Internal Market and Consumer Protection, Thematic Department for Economic, Scientific and Quality of Life Policies, European Parliament, Luxembourg, 2021.
[4]De Streel, A. et al., "Online Platforms' Moderation of Illegal Content Online", paper published for the Committee on the Internal Market and Consumer Protection, European Parliament, Thematic Department for Economic, Scientific and Quality of Life Policies, Luxembourg, 2020.
