Comparative Table between the existing acquis provisions and the corresponding provisions of the proposal on a Common European

Sales Law
Table I: Consumer Rights Directive (CRD): mainly full harmonisation directive + options for MS Existing acquis provision Corresponding provisions of the draft proposal: - underlined text does not have an equivalent the Regulation (CESLR) and the Annex I in the CESL, most often because of the (CESL) differences in scope - underlined text does not have an equivalent in the acquis, most often because it provides for higher levels of consumer protection Scope rules and Article 2 CRD Article 2(k) CESLR options left to (5) "sales contract" means any contract under 'sales contract': means any contract under which the Member which the trader transfers or undertakes to the trader ('the seller') States by the transfer the ownership of goods to the transfers or undertakes to transfer the ownership of Consumer consumer and the consumer pays or undertakes goods to another person Rights Directive to pay the price thereof, including any contract ('the buyer'), and the buyer pays or undertakes to having as its object both goods and services; pay the price thereof; it (4) "goods made to the consumer's includes a contract for the supply of goods to be specifications" means non-prefabricated goods manufactured or produced and excludes contracts made on the basis of an individual choice of or for the sale on execution or otherwise involving the decision by the consumer; exercise of public authority;

Level of protection in the CESL compared to the acquis (+ or =) and other comments: (=) The proposal uses the broader concept of "goods to be manufactured or produced" instead of "goods made to the consumer's specification" (in line with Directive 99/44). The wording of "goods made to the consumer's specifications is used in Chapter 4 on Right of Withdrawal.

(6) "service contract" means any contract other than a sales contract under which the trader supplies or undertakes to supply a service to the consumer and the consumer pays

(m) "related service" means any service related to CESL does not goods or digital content, such as installation, cover service maintenance, repair or any other processing, contracts as such, but only a few 1

or undertakes to pay the price thereof;

provided by the seller of the goods or the supplier of the digital content under the sales contract, the contract for the supply of digital content or a separate related service contract which was concluded at the same time as the sales contract or the contract for the supply of digital content; it excludes: (i) transport services, (ii) training services, (iii) telecommunications support services; and (iv) financial services; (j) digital content means data which is produced and supplied in digital form, whether or not according to the consumer's specifications; it excludes digital content pertaining to: (a) financial services including online banking services; (b) legal or financial advice provided in electronic form (c) electronic healthcare services; (d) electronic communications services and networks, and associated facilities and services; (e) gambling; (f) the provision of social networking services; and (g) the creation of new digital content and the amendment of existing digital content by consumers or any other interaction with the creations of other users; Financial services are excluded from the scope, see Article 2(m)(iv) CESLR. However, a specific definition was not considered to be necessary.

related services which fulfil the criteria in this definition.

(11) "digital content" means data which are produced and supplied in digital form;

Changes are due to the larger substantive scope of CESL: only those digital content products for which the sales remedies fit are covered by the CESL.

(12) "financial service" means any service of a banking, credit, insurance, personal pension, investment or payment nature;

(=) financial services are also excluded from the scope of the CRD, 2

see Art 3.3 (d). Definitions Art. 2 (1) "consumer": means any natural person who, in contracts covered by this Directive, is acting for purposes which are outside his trade, business, craft or profession. (2) "trader" means any natural person or any legal person, irrespective of whether privately or publicly owned, who is acting, including through any other person acting in his name or on his behalf, for purposes relating to his trade, business, craft or profession in relation to contracts covered by this Directive; Art. 2 CESLR (f) 'consumer': means any natural person who is acting for purposes which are outside that person's trade, business, craft, or profession; (e) 'trader': means any natural person or any legal person who is acting for purposes relating to that persons trade, business, craft, or profession; (=)

(=) CESL does not regulate representation and did not want to give that impression by including criteria which are used in national legal orders to determine representation. Therefore, in order to achieve the same result, where relevant, a reference is made in the respective provisions to "the trader or, in case the trader is a legal person, a natural person representing the trader" (for instance Article 2(p)).

(3) "goods" means any tangible movable items, with the exception of items sold by way of execution or otherwise by authority of law; water, gas and electricity shall be considered as goods within the meaning of this Directive where they are put up for sale in a limited volume or a set quantity;

(h) 'goods' means any tangible movable items; it excludes: (i) electricity and natural gas; and (ii) water and other types of gas unless they are put up for sale in a limited volume or set quantity;

(=) the proposal does not cover electricity and natural gas put up for sale in a limited volume or quantity since these do not have a cross-border relevance. The definition of "sales contracts" excludes items sold by way of execution or authority of law.

(7) "distance contract" means any contract concluded between the trader and the consumer under an organised distance sales or serviceprovision scheme without the simultaneous physical presence of the trader and the consumer, with the exclusive use of one or more means of distance communication up to and including the time at which the contract is concluded;

(p) 'distance contract' means any contract between the trader and the consumer under an organised distance sales scheme concluded without the simultaneous physical presence of the trader or, in case the trader is a legal person, a natural person representing the trader and the consumer, with the exclusive use of one or more means of distance communication up to and including the time at which the contract is concluded;

(=) See explanation under definition of "trader".

(8) "off-premises contract" means any contract between the trader and the consumer:

(q) 'off-premises contract' means any contract between a trader and a consumer:

(=)

(a) concluded in the simultaneous physical presence of the trader and the consumer, in a place which is not the business premises of the trader; (b) for which an offer was made by the consumer in the same circumstances, as referred to in point (a); (c) concluded on the business premises of the trader or through any means of distance communication immediately after the consumer was personally and individually addressed in a place which is not the business premises of the trader in the simultaneous physical presence of the trader and the consumer; or (d) concluded during an excursion organised by the trader with the aim or effect of promoting and selling goods or services to the consumer;

(i) concluded in the simultaneous physical presence of the trader or, in case the trader is a legal person, the natural person representing the trader and the See explanation consumer in a place which is not the trader's under definition of business premises, or "trader". concluded on the basis of an offer made by the consumer in the same circumstances; or (ii) concluded on the trader's business premises or through any means of distance communication immediately after the consumer was personally and individually addressed in a place which is not the trader's business premises in the simultaneous physical presence of the trader or, in case the trader is a legal person, a natural person representing the trader and the consumer; or (iii) concluded during an excursion organised by the trader or, in case the trader is a legal person, the natural person representing the trader with the aim or effect of promoting and selling goods or supplying digital content or services to the consumer; (r) 'business premises' means: (i) any immovable retail premises where a trader carries out activity on a permanent basis, or (=)

(9) "business premises" means: (a) any immovable retail premises where the trader carries out his activity on a permanent basis; or

(b) any movable retail premises where the trader carries out his activity on a usual basis;

(i) any movable retail premises where a trader carries out activity on a usual basis; (t) durable medium means any medium which (=) enables a party to store information addressed personally to that party in a way accessible for future reference for a period of time adequate for the purposes of the information and which allows the unchanged reproduction of the information stored; (u) 'public auction' means a method of sale where goods or digital content are offered by the trader to the consumer who attends or is given the possibility to attend the auction in person, through a transparent, competitive bidding procedure run by an auctioneer and where the successful bidder is bound to purchase the goods or digital content; The scope of the CRD and of CESL is slightly different: CESL covers only related services which are not the object of public auctions, while it applies in its entirety to digital content. (=)

(10) "durable medium" means any instrument which enables the consumer or the trader to store information addressed personally to him in a way accessible for future reference for a period of time adequate for the purposes of the information and which allows the unchanged reproduction of the information stored; (13) "public auction" means a method of sale where goods or services are offered by the trader to the consumer, who attends or is given the possibility to attend the auction in person, through a transparent, competitive bidding procedure run by an auctioneer and where the successful bidder is bound to purchase the goods or services;

(14) "commercial guarantee" means any undertaking by the trader or a producer (the guarantor) to the consumer, in addition to his legal obligation relating to the guarantee of conformity, to reimburse the price paid or to replace, repair or service goods in any way if they do not meet the specifications or any other requirements not related to conformity set out

(s) commercial guarantee means any undertaking by the trader or a producer to the consumer, in addition to his legal obligations under Article 107 in case of non-conformity to reimburse the price paid or to replace or repair or service goods or digital content in any way if they do not meet the specifications or any other requirements not related to conformity set out in the guarantee

in the guarantee statement or in the relevant advertising available at the time of, or before the conclusion of the contract; (15) "ancillary contract" means a contract by which the consumer acquires goods or services related to a distance contract or an off-premises contract and where those goods are supplied or those services are provided by the trader or by a third party on the basis of an arrangement between that third party and the trader. Information Art. 6(1)-(6) Information requirements for requirements for distance and off-premises contracts distance and off1. Before the consumer is bound by a premises distance or off-premises contract, or any contracts corresponding offer, the trader shall provide the consumer with the following information in a clear and comprehensible manner: (a) the main characteristics of the goods or services, to the extent appropriate to the medium and to the goods or services; (b) the identity of the trader, such as his trading name; (c) the geographical address at which the trader is established and the traders telephone number, fax number and e-mail address, where available, to enable the consumer to contact the trader quickly and

statement or in the relevant advertising available at the time of, or before the conclusion of the contract; Art. 46, paragraph 1, 2nd sentence CESL: an ancillary contract means a contract by which a consumer acquires goods, digital content or related services in connexion to a distance contract or an off-premises contract and these goods, digital content or related services are provided by the trader or a third party on the basis of an arrangement between that third party and the trader. Art. 13 Duty to provide information when concluding a distance or off-premises contract 1. A trader concluding a distance contract or offpremises contract has a duty to provide the following information to the consumer, in a clear and comprehensible manner before the contract is concluded or the consumer is bound by any offer: (a) the main characteristics of the goods, digital content or related services to be supplied, to an extent appropriate to the medium of communication and to the goods, digital content or related services; the total price and additional charges and costs, in accordance with Article 14; the identity and address of the trader, (=)

(b)

(c)

(=) The substance of the information requirements is the same in both CESL and CRD. The drafting and the presentation of the information requirements have been adapted in order to ensure the direct applicability and user-friendliness of the provisions of a Regulation for the intended users of this instrument. In this sense, the CRD requirements have

communicate with him efficiently and, where applicable, the geographical address and identity of the trader on whose behalf he is acting; (d) if different from the address provided in accordance with point (c), the geographical address of the place of business of the trader, and, where applicable, that of the trader on whose behalf he is acting, where the consumer can address any complaints; (e) the total price of the goods or services inclusive of taxes, or where the nature of the goods or services is such that the price cannot reasonably be calculated in advance, the manner in which the price is to be calculated, as well as, where applicable, all additional freight, delivery or postal charges and any other costs or, where those charges cannot reasonably be calculated in advance, the fact that such additional charges may be payable. In the case of a contract of indeterminate duration or a contract containing a subscription, the total price shall include the total costs per billing period. Where such contracts are charged at a fixed rate, the total price shall also mean the total monthly costs. Where the total costs cannot be reasonably calculated in advance, the manner in which the price is

in accordance with Article 15; (d) (e) (f)

been "contractualised" in the contract terms, in accordance the CESL. with Article 16; the rights of withdrawal, accordance with Article 17; in

where applicable, the existence and the conditions of the trader's aftersale customer assistance, after-sale services, commercial guarantees and complaints handling policy; where applicable, the possibility of having recourse to an Alternative Dispute Resolution mechanism to which the trader is subject and the methods for having access to it; where applicable, the functionality, including applicable technical protection measures, of digital content; and where applicable, any relevant interoperability of digital content with hardware and software which the trader is aware of or can be expected to have been aware of.

(g)

(h)

(i)

2. The information provided, except for the addresses required by point (c) of paragraph 1,

to be calculated shall be provided; (f) the cost of using the means of distance communication for the conclusion of the contract where that cost is calculated other than at the basic rate; (g) the arrangements for payment, delivery, performance, the time by which the trader undertakes to deliver the goods or to perform the services and, where applicable, the traders complaint handling policy; (h) where a right of withdrawal exists, the conditions, time limit and procedures for exercising that right in accordance with Article 11(1), as well as the model withdrawal form set out in Annex I(B); (i) where applicable, that the consumer will have to bear the cost of returning the goods in case of withdrawal and, for distance contracts, if the goods, by their nature, cannot normally be returned by post, the cost of returning the goods; (j) that, if the consumer exercises the right of withdrawal after having made a request in accordance with Article 7(3) or Article 8(8), the consumer shall be liable to pay the trader reasonable costs in accordance with Article 14(3); (k) where a right of withdrawal is not

forms an integral part of the contract and shall not be altered unless the parties expressly agree otherwise. Article 14 Information about price and additional charges and costs 1. The information to be provided under point (b) of Article 13 (1) must include: (a) the total price of the goods, digital content or related services, inclusive of taxes, or where the nature of the goods, digital content or related services is such that the price cannot reasonably be calculated in advance, the manner in which the price is to be calculated; and (b) where applicable, any additional freight, delivery or postal charges and any other costs or, where these cannot reasonably be calculated in advance, the fact that such additional charges and costs may be payable. 2. In the case of a contract of indeterminate duration or a contract containing a subscription, the total price must include the total price per billing period. Where such contracts are charged at a fixed rate, the total price must include the total monthly price. Where the total price cannot be reasonably

provided for in accordance with Article 16, the information that the consumer will not benefit from a right of withdrawal or, where applicable, the circumstances under which the consumer loses his right of withdrawal; (l) a reminder of the existence of a legal guarantee of conformity for goods; (m) where applicable, the existence and the conditions of after sale customer assistance, after-sales services and commercial guarantees; (n) the existence of relevant codes of conduct, as defined in point (f) of Article 2 of Directive 2005/29/EC, and how copies of them can be obtained, where applicable; (o) the duration of the contract, where applicable, or, if the contract is of indeterminate duration or is to be extended automatically, the conditions for terminating the contract; (p) where applicable, the minimum duration of the consumers obligations under the contract; (q) where applicable, the existence and the conditions of deposits or other financial guarantees to be paid or provided by the consumer at the request of the trader; (r) where applicable, the functionality,

calculated in advance, the manner in which the price is to be calculated must be provided. 3. Where applicable, the trader must inform the consumer of the cost of using the means of distance communication for the conclusion of the contract where that cost is calculated other than at the basic rate. Article 15 Information about the identity and address of the trader The information to be provided under point (c) of Article 13 (1) must include: (a) (b) (c) the identity of the trader, such as its trading name; the geographical address at which the trader is established; the telephone number, fax number and email address of the trader, where available, to enable the consumer to contact the trader quickly and communicate with the trader efficiently; where applicable, the identity and geographical address of any other trader on whose behalf the trader is acting; and where different from the address given

(d)

(e)

10

including applicable technical protection measures, of digital content; (s) where applicable, any relevant interoperability of digital content with hardware and software that the trader is aware of or can reasonably be expected to have been aware of; (t) where applicable, the possibility of having recourse to an out-of-court complaint and redress mechanism, to which the trader is subject, and the methods for having access to it. 2. Paragraph 1 shall also apply to contracts for the supply of water, gas or electricity, where they are not put up for sale in a limited volume or set quantity, of district heating or of digital content which is not supplied on a tangible medium. 3. In the case of a public auction, the information referred to in points (b), (c) and (d) of paragraph 1 may be replaced by the equivalent details for the auctioneer. 4. The information referred to in points (h), (i) and (j) of paragraph 1 may be provided by means of the model instructions on withdrawal set out in Annex I(A). The trader shall have fulfilled the information requirements laid down in points (h), (i) and (j) of paragraph 1 if he has supplied these instructions to the (c)

pursuant to points (b) and (d) of this Article, the geographical address of the trader, and where applicable that of the trader on whose behalf it is acting, where the consumer can address any complaints. Article 16 Information about the contract terms The information to be provided under point (d) of Article 13 (1) must include: (a) the arrangements for payment, delivery of the goods, supply of the digital content or performance of the related services and the time by which the trader undertakes to deliver the goods, to supply the digital content or to perform the related services; where applicable, the duration of the contract, the minimum duration of the consumer's obligations or, if the contract is of indeterminate duration or is to be extended automatically, the conditions for terminating the contract; and where applicable, the existence and conditions for deposits or other financial guarantees to be paid or provided by the consumer at the request of the trader; where applicable, the existence of relevant codes of conduct and how copies of them

(b)

(d)

11

consumer, correctly filled in. 5. The information referred to in paragraph 1 shall form an integral part of the distance or off-premises contract and shall not be altered unless the contracting parties expressly agree otherwise.

can be obtained. Article 17 Information about rights of withdrawal when concluding a distance or off-premises contract 1. Where the consumer has a right of withdrawal under Chapter 4, the information to be provided under point (e) of Article 13 (1) must include the conditions, time limit and procedures for exercising that right in accordance with Appendix 1, as well as the model withdrawal form set out in Appendix 2. 2. Where applicable, the information to be provided under point (e) of Article 13(1) must include the fact that the consumer will have to bear the cost of returning the goods in case of withdrawal and, for distance contracts, that the consumer will have to bear the cost of returning the goods in the event of withdrawal if the goods by their nature cannot be normally returned by post. 3. Where the consumer can exercise the right of withdrawal after having made a request for the provision of related services to begin during the withdrawal period, the information to be provided under point (e) of Article 13(1) must include the fact that the consumer would be liable to pay the trader the amount referred to in Article 45 (5). 4. The duty to provide the information required by paragraphs 1, 2 and 3 may be fulfilled by supplying

12

the Model instructions on withdrawal set out in Appendix 1 to the consumer. The trader will be deemed to have fulfilled these information requirements if he has supplied these instructions to the consumer correctly filled in. 5. Where a right of withdrawal is not provided for in accordance with points (c) to (i) of Article 40 (2) and paragraph 3 of that Article, the information to be provided under point (e) of Article 13 (1) must include a statement that the consumer will not benefit from a right of withdrawal or, where applicable, the circumstances under which the consumer loses the right of withdrawal. Annex II Standard Information Notice: contains the requirement that traders give consumers a reminder of the legal guarantee as well as other core consumer rights. Art. 13 (4) (=) For an off-premises contract, the information required by this Article must: (a) be given on paper or, if the consumer agrees, on another durable medium; and (b) be legible and in plain, intelligible language. Art. 18

Formal Art. 7 Formal requirements for off-premises requirements for contracts off-premises 1. With respect to off-premises contracts, contracts the trader shall give the information provided for in Article 6(1) to the consumer on paper or, if the consumer agrees, on another durable medium. That information shall be legible and in plain, intelligible language. 2. The trader shall provide the consumer with a copy of the signed contract or the confirmation of the contract on paper or, if

13

the consumer agrees, on another durable medium, including, where applicable, the confirmation of the consumers prior express consent and acknowledgement in accordance with point (m) of Article 16. 3. Where a consumer wants the performance of services or the supply of water, gas or electricity, where they are not put up for sale in a limited volume or set quantity, or of district heating to begin during the withdrawal period provided for in Article 9(2), the trader shall require that the consumer makes such an express request on a durable medium. 4. With respect to off-premises contracts where the consumer has explicitly requested the services of the trader for the purpose of carrying out repairs or maintenance for which the trader and the consumer immediately perform their contractual obligations and where the payment to be made by the consumer does not exceed EUR 200: (a) the trader shall provide the consumer with the information referred to in points (b) and (c) of Article 6(1) and information about the price or the manner in which the price is to be calculated together with an estimate of the total price, on paper or, if the consumer agrees, on another durable medium. The trader shall provide the

Off-premises contracts: additional information requirements and confirmation 1. Electricity and natural gas, as well as water and other types of gas which are not put up for sale in a limited volume or set quantity are outside the scope of the Where the consumer wants the provision of proposal. related services to begin during the withdrawal period provided for in Article 42(2), the trader must require that the Art. 7(4) CRD sets consumer makes such an express request up an option for the MS which has not on a durable medium. been exercised in the CESL. The trader must provide the consumer with a copy of the signed contract or the confirmation of the contract, including where applicable, the confirmation of the consumer's consent and acknowledgment as provided for in point (d) of Article 40(3) on paper or, if the consumer agrees, on a different durable medium.

2.

14

information referred to in points (a), (h) and (k) of Article 6(1), but may choose not to provide it on paper or another durable medium if the consumer expressly agrees; (b) the confirmation of the contract provided in accordance with paragraph 2 of this Article shall contain the information provided for in Article 6(1). Member States may decide not to apply this paragraph. Formal Art. 8 requirements for Formal requirements for distance distance contracts contracts 1. With respect to distance contracts, the trader shall give the information provided for in Article 6(1) or make that information available to the consumer in a way appropriate to the means of distance communication used in plain and intelligible language. In so far as that information is provided on a durable medium, it shall be legible. 2. If a distance contract to be concluded by electronic means places the consumer under an obligation to pay, the trader shall make the consumer aware in a clear and prominent manner, and directly before the consumer places his order, of the information provided for in points (a), (e),

Art. 13(3) For a distance contract, the information required by this Article must: (a) be given or made available to the consumer in a way that is appropriate to the means of distance communication used; (b) be in plain and intelligible language; and (c) insofar as it is provided on a durable medium, be legible. Article 19 Distance contracts: additional information and other requirements 1. When a trader makes a telephone call to a consumer, with a view to concluding a distance contract, the trader must, at the beginning of the conversation with the consumer, disclose its identity

(=)

15

(o) and (p) of Article 6(1). The trader shall ensure that the consumer, when placing his order, explicitly acknowledges that the order implies an obligation to pay. If placing an order entails activating a button or a similar function, the button or similar function shall be labelled in an easily legible manner only with the words "order with obligation to pay" or a corresponding unambiguous formulation indicating that placing the order entails an obligation to pay the trader. If the trader has not complied with this subparagraph, the consumer shall not be bound by the contract or order. 3. Trading websites shall indicate clearly and legibly at the latest at the beginning of the ordering process whether any delivery restrictions apply and which means of payment are accepted. 4. If the contract is concluded through a means of distance communication which allows limited space or time to display the information, the trader shall provide, on that particular means prior to the conclusion of such a contract, at least the pre-contractual information regarding the main characteristics of the goods or services, the identity of the trader, the total price, the right of withdrawal, the duration

and, where applicable, the identity of the person on whose behalf it is making the call and the commercial purpose of the call. 2. If the distance contract is concluded through a means of distance communication which allows limited space or time to display the information, the trader must provide at least the information referred to in paragraph 3 of this Article on that particular means prior to the conclusion of such a contract. The other information referred to in Article 13 shall be provided by the trader to the consumer in an appropriate way in accordance with Article 13(3). 3. The information required under paragraph 2 is: (a) the main characteristics of the goods, digital content or related services, as required by point (a) of Article 13 (1); (b) the identity of the trader, as required by point (a) of Article 15; (c) the total price, including all items referred to in point (b) of Article 13 (1) and Article 14(1) and (2); (d) the right of withdrawal; and (e) where relevant, the duration of the contract, and if the contract is for an indefinite period, the requirements for terminating the contract, referred to in

16

of the contract and, if the contract is of indeterminate duration, the conditions for terminating the contract, as referred to in points (a), (b), (e), (h) and (o) of Article 6(1). The other information referred to in Article 6(1) shall be provided by the trader to the consumer in an appropriate way in accordance with paragraph 1 of this Article. 5. Without prejudice to paragraph 4, if the trader makes a telephone call to the consumer with a view to concluding a distance contract, he shall, at the beginning of the conversation with the consumer, disclose his identity and, where applicable, the identity of the person on whose behalf he makes that call, and the commercial purpose of the call. 6. Where a distance contract is to be concluded by telephone, Member States may provide that the trader has to confirm the offer to the consumer who is bound only once he has signed the offer or has sent his written consent. Member States may also provide that such confirmations have to be made on a durable medium. 7. The trader shall provide the consumer with the confirmation of the contract concluded, on a durable medium within a reasonable time after the conclusion of the distance contract, and at the latest at the

point (b) of Article 16. 4. A distance contract concluded by telephone is valid only if the consumer has signed the offer or has sent his written consent indicating the agreement to conclude a contract. The trader must provide the consumer with a confirmation of that agreement on a durable medium. 5. The trader must give the consumer a confirmation of the contract concluded, including where applicable, of the consent and acknowledgement of the consumer referred to in point (d) of Article 40(3), and all the information referred to in Article 13 on a durable medium. The trader must give that information in reasonable time after the conclusion of the distance contract, and at the latest at the time of the delivery of the goods or before the supply of digital content or the provision of the related service begins, unless the information has already been given to the consumer prior to the conclusion of the distance contract on a durable medium. 6. Where the consumer wants the provision of related services to begin during the withdrawal period provided for in Article 42(2), the trader must require that the consumer makes an express request to that effect on a durable medium. Article 25 Additional requirements in distance contracts 17

time of the delivery of the goods or before the performance of the service begins. That confirmation shall include: (a) all the information referred to in Article 6(1) unless the trader has already provided that information to the consumer on a durable medium prior to the conclusion of the distance contract; and (b) where applicable, the confirmation of the consumers prior express consent and acknowledgment in accordance with point (m) of Article 16. 8. Where a consumer wants the performance of services, or the supply of water, gas or electricity, where they are not put up for sale in a limited volume or set quantity, or of district heating, to begin during the withdrawal period provided for in Article 9(2), the trader shall require that the consumer make an express request. 9. This Article shall be without prejudice to the provisions on the conclusion of econtracts and the placing of e-orders set out in Articles 9 and 11 of Directive 2000/31/EC. 10. Member States shall not impose any further formal pre-contractual information requirements for the fulfilment of the information obligations laid down in this

concluded by electronic means 1. Where a distance contract which is concluded by electronic means would oblige the consumer to make a payment, the trader must make the consumer aware in a clear and prominent manner, and immediately before the consumer places the order, of the information required by point (a) of Article 13 (1), Article 14(1) and (2), and point (b) of Article 16. 2. The trader must ensure that the consumer, when placing the order, explicitly acknowledges that the order implies an obligation to pay. Where placing an order entails activating a button or a similar function, the button or similar function must be labelled in an easily legible manner only with the words "order with obligation to pay" or similar unambiguous wording indicating that placing the order entails an obligation to make a payment to the trader. Where the trader has not complied with this paragraph, the consumer is not bound by the contract or order. 3. The trader must indicate clearly and legibly on its trading website at the latest at the beginning of the ordering process whether any delivery restrictions apply and what means of payment are accepted.

18

Directive. Information Art. 5 requirements for Information requirements for contracts contracts other other than distance or off-premises than distance and contracts off-premises 1. Before the consumer is bound by a contracts contract other than a distance or an offpremises contract, or any corresponding offer, the trader shall provide the consumer with the following information in a clear and comprehensible manner, if that information is not already apparent from the context: (a) the main characteristics of the goods or services, to the extent appropriate to the medium and to the goods or services; (b) the identity of the trader, such as his trading name, the geographical address at which he is established and his telephone number; (c) the total price of the goods or services inclusive of taxes, or where the nature of the goods or services is such that the price cannot reasonably be calculated in advance, the manner in which the price is to be calculated, as well as, where applicable, all additional freight, delivery or postal charges or, where those charges cannot reasonably be calculated in advance, the fact that such additional (k) Art. 20 Duty to provide information when concluding contracts other than distance and off-premises contracts 3. In contracts other than distance and offpremises contracts, a trader has a duty to provide the following information to the consumer, in a clear and comprehensible manner before the contract is concluded or the consumer is bound by any offer, if that information is not already apparent from the context: (j) the main characteristics of the goods, digital content or related services to be supplied, to an extent appropriate to the medium of communication and to the goods, digital content or related services; the total price and additional charges and costs, in accordance with Article 14(1); the identity of the trader, such as the trader's trading name, the geographical address at which it is established and its telephone number; (=)

(l)

19

charges may be payable; (d) where applicable, the arrangements for payment, delivery, performance, the time by which the trader undertakes to deliver the goods or to perform the service, and the traders complaint handling policy; (e) in addition to a reminder of the existence of a legal guarantee of conformity for goods, the existence and the conditions of after-sales services and commercial guarantees, where applicable; (f) the duration of the contract, where applicable, or, if the contract is of indeterminate duration or is to be extended automatically, the conditions for terminating the contract; (g) where applicable, the functionality, including applicable technical protection measures, of digital content; (h) where applicable, any relevant interoperability of digital content with hardware and software that the trader is aware of or can reasonably be expected to have been aware of. 2. Paragraph 1 shall also apply to contracts for the supply of water, gas or electricity, where they are not put up for sale in a limited volume or set quantity, of district heating or of digital content which is not 4.

(m) the contract terms in accordance with points (a) and (b) of Article 16; (n) where applicable, the existence and the conditions of the trader's aftersale services, commercial guarantees and complaints handling policy; where applicable, the functionality, including applicable technical protection measures of digital content; and where applicable, any relevant interoperability of digital content with hardware and software which the trader is aware of or can be expected to have been aware of.

(o)

(p)

This Article does not apply where the contract involves a day-to-day transaction and is performed immediately at the time of its conclusion.

Electricity and natural gas, as well as water and other

20

supplied on a tangible medium. 3. Member States shall not be required to apply paragraph 1 to contracts which involve day-to-day transactions and which are performed immediately at the time of their conclusion. 4. Member States may adopt or maintain additional pre-contractual information requirements for contracts to which this Article applies.

types of gas which are not put up for sale in a limited volume or set quantity are outside the scope of the proposal.

CESL does not allow MS to add further requirements. Burden of proof Art. 6(9) Art. 21 (+) The burden of As regards compliance with the information The trader bears the burden of proof that it has proof is on the trader requirements laid down in this Chapter, the provided the information required by this Section. in both distance and burden of proof shall be on the trader. off-premises contacts and in contracts other than distance and offpremises, the latter being regulated on a minimum harmonisation basis. Breach of Art. 6( 6): Art. 30 Remedies for breach of information duties (+) concerning the information 1. A party which has failed to comply with any duty liability for breach, duties If the trader has not complied with the is not imposed by this Chapter is liable for any loss which information requirements on additional charges caused to the other party by such failure. harmonised in the or other costs as referred to in point (e) of CRD paragraph 1, or on the costs of returning the 2. Where the trader has not complied with the goods as referred to in point (i) of paragraph 1, information requirements relating to additional the consumer shall not bear those charges or charges or other costs as referred to in Article 14 or costs. on the costs of returning the goods as referred to in 21

Article 17(2) the consumer is not liable to pay the additional charges and other costs. 3. The remedies provided under this Article are without prejudice to any remedy which may be available under Article 42 (2), Article 48 or Article 49. 4. In relations between a trader and a consumer the parties may not, to the detriment of the consumer, exclude the application of this Article or derogate from or vary its effects.

Art. 10: Omission of information on the right of withdrawal 1. If the trader has not provided the consumer with the information on the right of withdrawal as required by point (h) of Article 6(1), the withdrawal period shall expire 12 months from the end of the initial withdrawal period, as determined in accordance with Article 9(2). 2. If the trader has provided the consumer with the information provided for in paragraph 1 of this Article within 12 months from the day referred to in Article 9(2), the withdrawal period shall expire 14 days after the day upon which the consumer receives that information.

Art. 42( 2): Where the trader has not provided the consumer with the information referred to in Article 17 (1), the withdrawal period expires: (a) after one year from the end of the initial withdrawal period, as determined in accordance with paragraph 1; or (b) where the trader provides the consumer with the information required within one year from the end of the withdrawal period as determined in accordance with paragraph 1, after fourteen days from the day the consumer receives the information.

(=)

22

Right withdrawal

of Art. 9 Right of withdrawal 1. Save where the exceptions provided for in Article 16 apply, the consumer shall have a period of 14 days to withdraw from a distance or off-premises contract, without giving any reason, and without incurring any costs other than those provided for in Article 13(2) and Article 14. 3. The Member States shall not prohibit the contracting parties from performing their contractual obligations during the withdrawal period. Nevertheless, in the case of off-premises contracts, Member States may maintain existing national legislation prohibiting the trader from collecting the payment from the consumer during the given period after the conclusion of the contract.

(=) Article 40(1) Right to withdraw 1. During the period provided for in Article 42, the consumer has a right to withdraw from the contract without giving any reason, and at no cost to the consumer except as provided in Article 45, from: (a) a distance contract; (b) an off-premises contract, provided that the price or, where multiple contracts were concluded at the same time, the total price of the contracts exceeds EUR 50 or the equivalent sum in the currency agreed for In some cases Art. the contract price at the time of the 9(3) CRD leaves conclusion of the contract. MS an option which has not been See also Article 42(1) Withdrawal period exercised in the CESL.

Exceptions

Article 16 Exceptions from the right of withdrawal Member States shall not provide for the right of withdrawal set out in Articles 9 to 15 in respect of distance and off-premises contracts as regards the following: (a) service contracts after the service has been fully performed if the performance

Article 40 2. Paragraph 1 does not apply to: (a) a contract concluded by means of an automatic vending machine or automated commercial premises; (b) a contract for the supply of foodstuffs, beverages or other goods which are

(=)

23

has begun with the consumers prior express consent, and with the acknowledgement that he will lose his right of withdrawal once the contract has been fully performed by the trader; (b) the supply of goods or services for which the price is dependent on fluctuations in the financial market which cannot be controlled by the trader and which may occur within the withdrawal period; (c) the supply of goods made to the consumers specifications or clearly personalised; (d) the supply of goods which are liable to deteriorate or expire rapidly; (e) the supply of sealed goods which are not suitable for return due to health protection or hygiene reasons and were unsealed after delivery; (f) the supply of goods which are, after delivery, according to their nature, inseparably mixed with other items; (g) the supply of alcoholic beverages, the price of which has been agreed upon at the time of the conclusion of the sales contract, the delivery of which can only take place after 30 days and the actual value of which is dependent on

intended for current consumption in the household and which are physically supplied by the trader on frequent and regular rounds to the consumer's home, residence or workplace; (c) a contract for the supply of goods or related services for which the price depends on fluctuations in the financial market which cannot be controlled by the trader and which may occur within the withdrawal period; (d) a contract for the supply of goods or digital content which are made to the consumers specifications, or are clearly personalised; (e) a contract for the supply of goods which are liable to deteriorate or expire rapidly; (f) a contract for the supply of alcoholic beverages, the price of which has been agreed upon at the time of the conclusion of the sales contract, the delivery of which can only take place after 30 days from the time of conclusion of the contract and the actual value of which is dependent on fluctuations in the market which cannot be controlled by the trader; (g) a contract for the sale of a newspaper, 24

fluctuations in the market which cannot be controlled by the trader; (h) contracts where the consumer has specifically requested a visit from the trader for the purpose of carrying out urgent repairs or maintenance. If, on the occasion of such visit, the trader provides services in addition to those specifically requested by the consumer or goods other than replacement parts necessarily used in carrying out the maintenance or in making the repairs, the right of withdrawal shall apply to those additional services or goods; (i) the supply of sealed audio or sealed video recordings or sealed computer software which were unsealed after delivery; (j) the supply of a newspaper, periodical or magazine with the exception of subscription contracts for the supply of such publications; (k) contracts concluded at a public auction; (l) the provision of accommodation other than for residential purpose, transport of goods, car rental services, catering or services related to leisure activities if the contract provides for a specific date or period of performance; (m) the supply of digital content which is

periodical or magazine with the exception of subscription contracts for the supply of such publications; (h) a contract concluded at a public auction; and (i) a contract for catering or services related to leisure activities which provides for a specific date or period of performance. 3. Paragraph 1 does not apply in the following situations: (a) where the goods supplied were sealed, have been unsealed by the consumer and are not then suitable for return due to health protection or hygiene reasons; (b) where the goods supplied have, according to their nature, been inseparably mixed with other items after delivery; (c) where the goods supplied were sealed audio or video recordings or computer software and have been unsealed after delivery; (d) where the supply of digital content which is not supplied on a tangible medium has begun with the consumer's prior express consent and with the

25

not supplied on a tangible medium if the performance has begun with the consumers prior express consent and his acknowledgment that he thereby loses his right of withdrawal. Art. 3, 3. (k): Directive does not apply to contracts for the supply of foodstuffs, beverages or other goods intended for current consumption in the household, and which are physically supplied by a trader on frequent and regular rounds to the consumer's home, residence or workplace;

acknowledgement by the consumer of losing the right to withdraw; (e) the consumer has specifically requested a visit from the trader for the purpose of carrying out urgent repairs or maintenance. Where on the occasion of such a visit the trader provides related services in addition to those specifically requested by the consumer or goods other than replacement parts necessarily used in performing the maintenance or in making the repairs, the right of withdrawal applies to those additional related services or goods.

Art. 3, 3. (l): Directive does not apply to 4. Where the consumer has made an offer which, if contracts concluded by means of automatic accepted, would lead to the conclusion of a contract vending machines or automated commercial from which there would be a right to withdraw premises under this Chapter, the consumer may withdraw the offer even if it would otherwise be irrevocable. Omission information of Article 10 Omission of information on the right of withdrawal 1. If the trader has not provided the consumer with the information on the right of withdrawal as required by point (h) of Article 6(1), the withdrawal period shall expire 12 months from the end of the initial withdrawal period, as determined in accordance with Article 9(2). 2. If the trader has provided the consumer Article 42(2) Where the trader has not provided the consumer with the information referred to in Article 17 (1), the withdrawal period expires: (a) after one year from the end of the initial withdrawal period, as determined in accordance with paragraph 1; or (b) where the trader provides the consumer with the information required within one 26 (=)

with the information provided for in paragraph 1 of this Article within 12 months from the day referred to in Article 9(2), the withdrawal period shall expire 14 days after the day upon which the consumer receives that information. Exercise right of Art. 11 Exercise of the right of withdrawal withdrawal 1. Before the expiry of the withdrawal period, the consumer shall inform the trader of his decision to withdraw from the contract. For this purpose, the consumer may either: (a) use the model withdrawal form as set out in Annex I(B); or (b) make any other unequivocal statement setting out his decision to withdraw from the contract. Member States shall not provide for any formal requirements applicable to the model withdrawal form other than those set out in Annex I(B). 2. The consumer shall have exercised his right of withdrawal within the withdrawal period referred to in Article 9(2) and Article 10 if the communication concerning the exercise of the right of withdrawal is sent by the consumer before that period has expired. 3. The trader may, in addition to the

year from the end of the withdrawal period as determined in accordance with paragraph 1, after fourteen days from the day the consumer receives the information.

Art. 41 Exercise of right to withdraw 1. The consumer may exercise the right to withdraw at any time before the end of the period of withdrawal provided for in Article 42. 2. The consumer exercises the right to withdraw by notice to the trader. For this purpose, the consumer may use either the Model withdrawal form set out in Appendix 2 or any other unequivocal statement setting out the decision to withdraw. 3. Where the trader gives the consumer the option to withdraw electronically on its trading website, and the consumer does so, the trader has a duty to communicate to the consumer an acknowledgement of receipt of such a withdrawal on a durable medium without delay. The trader is liable for any loss caused to the other party by a breach of this duty. 4. A communication of withdrawal is timely if sent before the end of the withdrawal period. 5. The consumer bears the burden of proof that the right of withdrawal has been exercised in accordance with this Article.

(=)

27

possibilities referred to in paragraph 1, give the option to the consumer to electronically fill in and submit either the model withdrawal form set out in Annex I(B) or any other unequivocal statement on the traders website. In those cases the trader shall communicate to the consumer an acknowledgement of receipt of such a withdrawal on a durable medium without delay. 4. The burden of proof of exercising the right of withdrawal in accordance with this Article shall be on the consumer. Art. 9(2) Without prejudice to Article 10, the withdrawal period referred to in paragraph 1 of this Article shall expire after 14 days from: (a) in the case of service contracts, the day of the conclusion of the contract; (b) in the case of sales contracts, the day on which the consumer or a third party other than the carrier and indicated by the consumer acquires physical possession of the goods or: (i) in the case of multiple goods ordered by the consumer in one order and delivered separately, the day on which the consumer or a third party other than the carrier and indicated by the consumer acquires

Withdrawal period

Art. 42 Withdrawal period 1.The withdrawal period expires after fourteen days from: (a) the day on which the consumer has taken delivery of the goods in the case of a sales contract, including a sales contract under which the seller also agrees to provide related services; (b) the day on which the consumer has taken delivery of the last item in the case of a contract for the sale of multiple goods ordered by the consumer in one order and delivered separately, including a contract under which the seller also agrees to provide related services;

(=) The CESL uses as the starting point of the withdrawal period the moment when the consumer "takes delivery of the goods", which is defined in Article 129 as the moment where the buyer does all the acts which could be expected in order to enable to seller to perform the obligation to deliver and takes over the

28

physical possession of the last good; (ii) in the case of delivery of a good consisting of multiple lots or pieces, the day on which the consumer or a third party other than the carrier and indicated by the consumer acquires physical possession of the last lot or piece; (iii) in the case of contracts for regular delivery of goods during defined period of time, the day on which the consumer or a third party other than the carrier and indicated by the consumer acquires physical possession of the first good; (c) in the case of contracts for the supply of water, gas or electricity, where they are not put up for sale in a limited volume or set quantity, of district heating or of digital content which is not supplied on a tangible medium, the day of the conclusion of the contract.

(c) the day on which the consumer has taken delivery of the last lot or piece in the case of a contract where the goods consist of multiple lots or pieces, including a contract under which the seller also agrees to provide related services; (d) the day on which the consumer has taken delivery of the first item where the contract is for regular delivery of goods during a defined period of time, including a contract under which the seller also agrees to provide related services; (e) the day of the conclusion of the contract in the case of a contract for related services concluded after the goods have been delivered; (f) the day when the consumer has taken delivery of the tangible medium in accordance with point (a) in the case of a contract for the supply of digital content where the digital content is supplied on a tangible medium; (g) the day of the conclusion of the contract in the case of a contract where the digital content is not supplied on a tangible medium.

goods or the documents representing the goods or digital content, as required by the contract.

Effects withdrawal

of Art. 12

Art. 43 Effects of withdrawal

(=)

29

Effects of withdrawal The exercise of the right of withdrawal shall terminate the obligations of the parties: (a) to perform the distance or off-premises contract; or (b) to conclude the distance or offpremises contract, in cases where an offer was made by the consumer. Obligation of the Art. 13 trader in case of Obligations of the trader in the event of withdrawal withdrawal 1. The trader shall reimburse all payments received from the consumer, including, if applicable, the costs of delivery without undue delay and in any event not later than 14 days from the day on which he is informed of the consumers decision to withdraw from the contract in accordance with Article 11. The trader shall carry out the reimbursement referred to in the first subparagraph using the same means of payment as the consumer used for the initial transaction, unless the consumer has expressly agreed otherwise and provided that the consumer does not incur any fees Withdrawal terminates the obligations of both parties under the contract: (a) (b) to perform the contract; or to conclude the contract in cases where an offer was made by the consumer.

Art. 44 Obligations of the trader in the event of withdrawal 1. The trader must reimburse all payments received from the consumer, including, where applicable, the costs of delivery without undue delay and in any event not later than fourteen days from the day on which the trader is informed of the consumer's decision to withdraw from the contract in accordance with Article 41. The trader must carry out such reimbursement using the same means of payment as the consumer used for the initial transaction, unless the consumer has expressly agreed otherwise and provided that the consumer does not incur any fees as a result of such reimbursement. 2. Notwithstanding paragraph 1, the trader is not required to reimburse the supplementary costs, if the consumer has expressly opted for a type of delivery other than the least expensive type of

(=)

30

as a result of such reimbursement. 2. Notwithstanding paragraph 1, the trader shall not be required to reimburse the supplementary costs, if the consumer has expressly opted for a type of delivery other than the least expensive type of standard delivery offered by the trader. 3. Unless the trader has offered to collect the goods himself, with regard to sales contracts, the trader may withhold the reimbursement until he has received the goods back, or until the consumer has supplied evidence of having sent back the goods, whichever is the earliest.

standard delivery offered by the trader. 3. In the case of a contract for the sale of goods, the trader may withhold the reimbursement until it has received the goods back, or the consumer has supplied evidence of having sent back the goods, whichever is earlier, unless the trader has offered to collect the goods.

Obligation of the Article 14 consumer in case Obligations of the consumer in the event of withdrawal of withdrawal 1. Unless the trader has offered to collect the goods himself, the consumer shall send back the goods or hand them over to the trader or to a person authorised by the trader to receive the goods, without undue delay and in any event not later than 14 days from the day on which he has communicated his decision to withdraw from the contract to the trader in accordance with Article 11. The deadline

Article 45 Obligations of the consumer in the event of withdrawal 1. The consumer must send back the goods or hand them over to the trader or to a person authorised by the trader without undue delay and in any event not later than fourteen days from the day on which the consumer communicates the decision to withdraw from the contract to the trader in accordance with Article 41, unless the trader has offered to collect the goods. This deadline is met if the consumer sends back the goods before the period of fourteen days has expired. 2. The consumer must bear the direct costs of

(=)

31

shall be met if the consumer sends back the goods before the period of 14 days has expired. The consumer shall only bear the direct cost of returning the goods unless the trader has agreed to bear them or the trader failed to inform the consumer that the consumer has to bear them. In off-premises contracts where the goods have been delivered to the consumers home at the time of the conclusion of the contract, the trader shall at his own expense collect the goods if, by their nature, those goods cannot normally be returned by post.2. The consumer shall only be liable for any diminished value of the goods resulting from the handling of the goods other than what is necessary to establish the nature, characteristics and functioning of the goods. The consumer shall in any event not be liable for diminished value of the goods where the trader has failed to provide notice of the right of withdrawal in accordance with point (h) of Article 6(1). (See Article 44(4) CESL). 3. Where a consumer exercises the right of withdrawal after having made a request in accordance with Article 7(3) or Article 8(8), the consumer shall pay to the trader an amount which is in proportion to what

returning the goods, unless the trader has agreed to bear those costs or the trader failed to inform the consumer that the consumer has to bear them. 3. The consumer is liable for any diminished value of the goods only where that results from handling of the goods in any way other than what is necessary to establish the nature, characteristics and functioning of the goods. The consumer is not liable for diminished value where the trader has not provided all the information about the right to withdraw in accordance with Article 17 (1). 4. Without prejudice to paragraph 3, the consumer is not liable to pay any compensation for the use of the goods during the withdrawal period. 5. Where the consumer exercises the right of withdrawal after having made an express request for the provision of related services to begin during the withdrawal period, the consumer must pay to the trader an amount which is in proportion to what has been provided before the consumer exercised the right of withdrawal, in comparison with the full coverage of the contract. The proportionate amount to be paid by the consumer to the trader must be calculated on the basis of the total price agreed in the contract. Where the total price is excessive, the proportionate amount must be calculated on the basis of the market value of what has been provided.

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has been provided until the time the consumer has informed the trader of the exercise of the right of withdrawal, in comparison with the full coverage of the contract. The proportionate amount to be paid by the consumer to the trader shall be calculated on the basis of the total price agreed in the contract. If the total price is excessive, the proportionate amount shall be calculated on the basis of the market value of what has been provided. 4. The consumer shall bear no cost for: (a) the performance of services or the supply of water, gas or electricity, where they are not put up for sale in a limited volume or set quantity, or of district heating, in full or in part, during the withdrawal period, where: (i) the trader has failed to provide information in accordance with points (h) or (j) of Article 6(1); or (ii) the consumer has not expressly requested performance to begin during the withdrawal period in accordance with Article 7(3) and Article 8(8); or (b) the supply, in full or in part, of digital content which is not supplied on a tangible medium where: (i) the consumer has not given his prior

6. The consumer is not liable for the cost for: (a) the provision of related services, in full or in part, during the withdrawal period, where: (i) the trader has failed to provide information in accordance with Article 17(1) and (3); or (ii) the consumer has not expressly requested performance to begin during the withdrawal period in accordance with Article 18(2) and Article 19(6); (b) for the supply, in full or in part, of digital content which is not supplied on a tangible medium where: (i) the consumer has not given prior express consent for the supply of digital content to begin before the end of the period of withdrawal referred to in Article 42(1); (ii) the consumer has not acknowledged losing the right of withdrawal when giving the consent; or (iii) the trader has failed to provide the confirmation in accordance with 33

express consent to the beginning of the performance before the end of the 14-day period referred to in Article 9; (ii) the consumer has not acknowledged that he loses his right of withdrawal when giving his consent; or (iii) the trader has failed to provide confirmation in accordance with Article 7(2) or Article 8(7). 5. Except as provided for in Article 13(2) and in this Article, the consumer shall not incur any liability as a consequence of the exercise of the right of withdrawal. Ancillary contracts

Article 18(1) and Article 19(5). Except as provided for in this Article, the consumer does not incur any liability through the exercise of the right of withdrawal. Article 44(4) In the case of an off-premises contract where the goods have been delivered to the consumers home at the time of the conclusion of the contract, the trader must collect the goods at its own cost if the goods by their nature cannot be normally returned by post.

Art. 15 Effects of the exercise of the right of Art. 46 Ancillary contracts (=) withdrawal on ancillary contracts 1. Where a consumer exercises the right of 1. Without prejudice to Article 15 of withdrawal from a distance or an off-premises Directive 2008/48/EC of the European contract in accordance with Articles 41 to 45, any Parliament and of the Council of 23 April ancillary contracts are automatically terminated at 2008 on credit agreements for consumers no cost to the consumer except as provided in [20], if the consumer exercises his right of paragraphs 2 and 3. [] withdrawal from a distance or an offpremises contract in accordance with 2. The provisions of Articles 43, 44 and 45 apply Articles 9 to 14 of this Directive, any accordingly to ancillary contracts to the extent that ancillary contracts shall be automatically those contracts are governed by the Common terminated, without any costs for the European Sales Law. consumer, except as provided for in 3. For ancillary contracts which are not governed by Article 13(2) and in Article 14 of this the Common European Sales Law the applicable Directive. law governs the obligations of the parties in the 2. The Member States shall lay down 34

detailed rules on the termination of such contracts. Time of Delivery Art. 18(1) Delivery 1. Unless the parties have agreed otherwise on the time of delivery, the trader shall deliver the goods by transferring the physical possession or control of the goods to the consumer without undue delay, but not later than 30 days from the conclusion of the contract.

event of withdrawal.

Article 96 Time of delivery 1. Where the time of delivery cannot be otherwise determined, the goods or the digital content must be delivered without undue delay after the conclusion of the contract. 2. In contracts between a trader and a consumer, unless agreed otherwise by the parties, the trader must deliver the goods or the digital content not later than 30 days from the conclusion of the contract. Article 115 Termination for delay in delivery after notice fixing additional time for performance A buyer may terminate the contract in a case of delay in delivery which is not in itself fundamental if the buyer gives notice fixing an additional period of time of reasonable length for performance and the seller does not perform within that period.

(=) A distinction between B2B and B2C contracts was necessary, hence the need for two paragraphs.

Remedies for Art. 18(2) Delivery late performance 2. Where the trader has failed to fulfil his obligation to deliver the goods at the time agreed upon with the consumer or within the time limit set out in paragraph 1, the consumer shall call upon him to make the delivery within an additional period of time appropriate to the circumstances. If the trader fails to deliver the goods within that additional period of time, the consumer shall be entitled to terminate the contract. The first subparagraph shall not be applicable to sales contracts where the trader has refused to deliver the goods or

(=)

Article 114(1) Termination for non-performance 1. A buyer may terminate the contract within the (=) meaning of Article 8 if the sellers non-performance 35

where delivery within the agreed delivery period is essential taking into account all the circumstances attending the conclusion of the contract or where the consumer informs the trader, prior to the conclusion of the contract, that delivery by or on a specified date is essential. In those cases, if the trader fails to deliver the goods at the time agreed upon with the consumer or within the time limit set out in paragraph 1, the consumer shall be entitled to terminate the contract immediately. 3. Upon termination of the contract, the trader shall, without undue delay, reimburse all sums paid under the contract.

under the contract is fundamental within the meaning of Article 87 (2). Article 87(2) Non-performance of an obligation by one party is fundamental if: (q) it substantially deprives the other party of what that party was entitled to expect under the contract, unless at the time of conclusion of the contract the non-performing party did not foresee and could not be expected to have foreseen that result; or it is of such a nature as to make it clear that the non-performing partys future performance cannot be relied on.

(r)

4. In addition to the termination of the contract in accordance with paragraph 2, the consumer may have recourse to other remedies provided for by national law.

Article 116 Termination for anticipated nonperformance A buyer may terminate the contract before performance is due if the seller has declared, or it is otherwise clear, that there will be a nonperformance, and if the non-performance would be such as to justify termination.

Article 172(1) Restitution on avoidance or termination

(=)

36

1. Where a contract is avoided or terminated by either party, each party is obliged to return what that party (the recipient) has received from the other party.

Art. 106 Overview of buyer's remedies 1. In the case of non-performance of an obligation by the seller, the buyer may do any of the (+) Specifies the other remedies following: which the consumer (a) require performance, which includes can have recourse specific performance, repair or to. replacement of the goods or digital content, under Section 3 of this Chapter; (b) withhold the buyers own performance under Section 4 of this Chapter; (c) terminate the contract under Section 5 of this Chapter and claim the return of any price already paid, under Chapter 17; (d) reduce the price under Section 6 of this Chapter; and (e) claim damages under Chapter 16. Fees for means of payment Article 19 Fees for the use of means of payment Member States shall prohibit traders from Art. 124(4) Means of payment In a contract between a trader and a consumer, the consumer is not liable, in respect of the use of a 37 (=)

charging consumers, in respect of the use of a given means of payment, fees that exceed the cost borne by the trader for the use of such means. Passing of risk Art. 20 Passing of risk Art 145 In contracts where the trader dispatches the goods to the consumer, the risk of loss of or damage to the goods shall pass to the consumer when he or a third party indicated by the consumer and other than the carrier has acquired the physical possession of the goods. However, the risk shall pass to the consumer upon delivery to the carrier if the carrier was commissioned by the consumer to carry the goods and that choice was not offered by the trader, without prejudice to the rights of the consumer against the carrier.

given means of payment, for fees that exceed the cost borne by the trader for the use of such means.

Art. 142 Passing of risk in a consumer sales (+) It covers also contract digital content is not 1. In a consumer sales contract, the risk passes at which supplied on a the time when the consumer or a third party designated by the consumer, not being the carrier, tangible medium. has acquired the physical possession of the goods or the tangible medium on which the digital content is supplied. 2. In a contract for the supply of digital content not supplied on a tangible medium, the risk passes at the time when the consumer or a third party designated by the consumer for this purpose has obtained the control of the digital content. 3. Except where the contract is a distance or offpremises contract, paragraphs 1 and 2 do not apply where the consumer fails to perform the obligation to take over the goods or the digital content and the non-performance is not excused under Article 88. In this case, the risk passes at the time when the consumer, or the third party designated by the consumer, would have acquired the physical possession of the goods or obtained the control of the digital content if the obligation to take them over had been performed. 4. Where the consumer arranges the carriage of the 38

goods or the digital content supplied on a tangible medium and that choice was not offered by the trader, the risk passes when the goods or the digital content supplied on a tangible medium are handed over to the carrier, without prejudice to the rights of the consumer against the carrier. 5. The parties may not, to the detriment of the consumer, exclude the application of this Article or derogate from or vary its effects. Art. 141 Identification of goods or digital content to contract The risk does not pass to the buyer until the goods or the digital content are clearly identified as the goods or digital content to be supplied under the contract, whether by the initial agreement, by notice given to the buyer or otherwise. Article 21 Communication by telephone Member States shall ensure that where the trader operates a telephone line for the purpose of contacting him by telephone in relation to the contract concluded, the consumer, when contacting the trader is not bound to pay more than the basic rate. The first subparagraph shall be without prejudice to the right of telecommunication services providers to charge for such calls. This provision was not implemented in the CESL because it was not considered to be of a contractual nature.

39

Additional payments

Article 22 Additional payments Before the consumer is bound by the contract or offer, the trader shall seek the express consent of the consumer to any extra payment in addition to the remuneration agreed upon for the traders main contractual obligation. If the trader has not obtained the consumers express consent but has inferred it by using default options which the consumer is required to reject in order to avoid the additional payment, the consumer shall be entitled to reimbursement of this payment.

Article 71 Additional payments in contracts between a trader and a consumer 1. In a contract between a trader and a consumer, a contract term which obliges the consumer to make any payment in addition to the remuneration stated for the traders main contractual obligation, in particular where it has been incorporated by the use of default options which the consumer is required to reject in order to avoid the additional payment, is not binding on the consumer unless, before the consumer is bound by the contract, the consumer has expressly consented to the additional payment. If the consumer has made the additional payment, the consumer may recover it. 2. The parties may not, to the detriment of the consumer, exclude the application of this Article or derogate from or vary its effects.

(=)

40

Table II: Consumer Sales Directive 99/44/EC: minimum harmonisation directive Existing acquis provision Scope Art. 1(2)(b) Scope and definition "consumer goods": shall mean any tangible movable item, with the exception of: - goods sold by way of execution or otherwise by authority of law, - water and gas where they are not put up for sale in a limited volume or set quantity, - electricity; Art. 1(3) and (4) 3. Member States may provide that the expression "consumer goods" does not cover second-hand goods sold at public auction where consumers have the opportunity of attending the sale in person. 4. Contracts for the supply of consumer goods to be manufactured or produced shall also be deemed contracts of sale for the purpose of this Directive. Corresponding provisions of the draft proposal for a CESL Article 2 (h) 'goods': means any tangible movable items; it excludes: (i) electricity and natural gas; and (b) water and other types of gas unless they are put up for sale in a limited volume or set quantity; Level of protection in the CESL (+) Because of extension of the scope to digital content whether supplied on a tangible medium or not.

(k) 'sales contract' means any contract under which the trader ('the seller') transfers or undertakes to transfer the ownership of goods to another person ('the buyer'), and the buyer pays or undertakes to pay the price thereof; it includes a contract for the supply of goods to be manufactured or produced Article 1(3) of the and excludes contracts for the sale on execution or Consumer Sales otherwise involving the exercise of public authority; Directive gives an option to the Member States which is not Article 5 CESLR: Contracts for which the exercised in the Common European Sales Law can be used proposal The Common European Sales Law may be used for: (a) (b) sales contracts; contracts for the supply of digital content whether or not supplied on a tangible medium which can be stored, processed or accessed, and re-used by the user, irrespective of whether the digital content

41

is supplied in exchange for the payment of a price. Duty of conformity with the contract Art. 2 (1) The seller must deliver goods to the consumer which are in conformity with the contract of sale. Art. 91(c) Main obligations of the seller The seller of goods or the supplier of digital content (in this part referred to as 'the seller') must (a) (b) deliver the goods or supply the digital content; transfer the ownership of the goods, including the tangible medium on which the digital content is supplied; ensure that the goods or the digital content are in conformity with the contract; ensure that the buyer has the right to use the digital content in accordance with the contract; and deliver such documents representing or relating to the goods or documents relating to the digital content as may be required by the contract. (+) Article 99 and 100 go beyond the Consumer Sales 42 (+)

(c) (d)

(e)

Test of conformity

Art. 2(2) Consumer goods are presumed to be in conformity with the contract if they:

Article 99 Conformity with the contract

(a) comply with the description given by the seller and possess the qualities of the goods which the seller has held out to the consumer as a sample or model; (b) are fit for any particular purpose for which the consumer requires them and which he made known to the seller at the time of conclusion of the contract and which the seller has accepted; (c) are fit for the purposes for which goods of the same type are normally used; (d) show the quality and performance which are normal in goods of the same type and which the consumer can reasonably expect, given the nature of the goods and taking into account any public statements on the specific characteristics of the goods made about them by the seller, the producer or his representative, particularly in advertising or on labeling. Recital (8) Whereas, in order to facilitate the application of the principle of conformity with the contract, it is useful to introduce a rebuttable presumption of conformity with the contract covering the most common situations; whereas that presumption does not restrict the principle of freedom of contract; whereas,

1. In order to conform with the contract, the goods Directive because they set up a test of or digital content must: conformity, not a (a) be of the quantity, quality and mere presumption of conformity. description required by the contract; Furthermore, the (b) be contained or packaged in the manner factors for establishing required by the contract; and conformity are more (c) be supplied along with any accessories, comprehensive and installation instructions or other precise. instructions required by the contract. 2. In order to conform with the contract the goods or digital content must also meet the requirements of Articles 100, 101 and 102, save to the extent that the parties have agreed otherwise. Article 100 Criteria for conformity of the goods and digital content The goods or digital content must: (a) be fit for any particular purpose made known to the seller at the time of the conclusion of the contract, except where the circumstances show that the buyer did not rely, or that it was unreasonable for the buyer to rely, on the sellers skill and judgement; be fit for the purposes for which goods or 43

(b)

furthermore, in the absence of specific contractual terms, as well as where the minimum protection clause is applied, the elements mentioned in this presumption may be used to determine the lack of conformity of the goods with the contract; whereas the quality and performance which consumers can reasonably expect will depend inter alia on whether the goods are new or second-hand; whereas the elements mentioned in the presumption are cumulative; whereas, if the circumstances of the case render any particular element manifestly inappropriate, the remaining elements of the presumption nevertheless still apply.

digital content of the same description would ordinarily be used; (c) possess the qualities of goods or digital content which the seller held out to the buyer as a sample or model; be contained or packaged in the manner usual for such goods or, where there is no such manner, in a manner adequate to preserve and protect the goods; be supplied along with such accessories, installation instructions or other instructions as the buyer may expect to receive; possess the qualities and performance capabilities indicated in any precontractual statement which forms part of the contract terms by virtue of Article 69; and possess such qualities and performance capabilities as the buyer may expect. When determining what the consumer may expect of the digital content regard is to be had to whether or not the digital content was supplied in exchange for the payment of a price. (+)

(d)

(e)

(f)

(g)

Art. 2(3)

Art. 99(3)

44

There shall be deemed not to be a lack of conformity for the purposes of this Article if, at the time the contract was concluded, the consumer was aware, or could not reasonably be unaware of, the lack of conformity, or if the lack of conformity has its origin in materials supplied by the consumer.

In a consumer sales contract, any agreement derogating from the requirements of Articles 100, 102 and 103 to the detriment of the consumer is valid only if, at the time of the conclusion of the contract, the consumer knew of the specific condition of the goods or the digital content and accepted the goods or the digital content as being in conformity with the contract when concluding it. Article 106(5) The buyer may not resort to any of the remedies referred to in paragraph 1 to the extent that the buyer caused the sellers non-performance.

Because the consumer must have actual knowledge of the lack of conformity and it is necessary that he accepts the goods as being in conformity with the contract when concluding it.

Art. 2(4) The seller shall not be bound by public statements, as referred to in paragraph 2(d) if he: - shows that he was not, and could not reasonably have been, aware of the statement in question, - shows that by the time of conclusion of the contract the statement had been corrected, or - shows that the decision to buy the consumer goods could not have been influenced by the statement.

Article 69 Contract terms derived from certain precontractual statements 1. Where the trader makes a statement before the contract is concluded, either to the other party or publicly, about the characteristics of what is to be supplied by that trader under the contract, the statement is incorporated as a term of the contract unless: (a) the other party was aware, or could be expected to have been aware when the contract was concluded that the statement was incorrect or could not otherwise be relied on as such a term; or

(+) In the CESL, the trader is bound by statements made before the conclusion of the contract unless certain limited conditions are met. In addition, the condition in letter (a) is more protective than Directive 99/44 because it makes knowledge of the business immaterial for the purposes of 45

(b) the other partys decision to conclude determining if a the contract could not have been influenced term is incorporated into the contract and by the statement. focuses instead on 2. For the purposes of paragraph 1, a statement the awareness of the made by a person engaged in advertising or consumer of the marketing for the trader is regarded as being made incorrectness or unreliability of the by the trader. term. 3. Where the other party is a consumer then, for the purposes of paragraph 1, a public statement made by or on behalf of a producer or other person in earlier links of the chain of transactions leading to the contract is regarded as being made by the trader unless the trader, at the time of conclusion of the contract, did not know and could not be expected to have known of it. 4. In relations between a trader and a consumer the parties may not, to the detriment of the consumer, exclude the application of this Article or derogate from or vary its effects. Art. 2(5) Any lack of conformity resulting from incorrect installation of the consumer goods shall be deemed to be equivalent to lack of conformity of the goods if installation forms part of the contract of sale of the goods and the goods were installed by the seller or under his responsibility. This shall apply equally if the product, intended to be installed by the consumer, is installed by the consumer and the (=) Article 101 Incorrect installation under a consumer sales contract 1. Where goods or digital content supplied under a consumer sales contract are incorrectly installed, any lack of conformity resulting from the incorrect installation is regarded as lack of conformity of the goods or the digital content if:

46

incorrect installation is due to a shortcoming in the installation instructions.

(a) the goods or the digital content were installed by the seller or under the sellers responsibility; or (b) the goods or the digital content were intended to be installed by the consumer and the incorrect installation was due to a shortcoming in the installation instructions. 2. The parties may not, to the detriment of the consumer, exclude the application of this Article or derogate from or vary its effects.

Remedies

Art. 3 Rights of the consumer 1. The seller shall be liable to the consumer for any lack of conformity which exists at the time the goods were delivered. 2. In the case of a lack of conformity, the consumer shall be entitled to have the goods brought into conformity free of charge by repair or replacement, in accordance with paragraph 3, or to have an appropriate reduction made in the price or the contract rescinded with regard to those goods, in accordance with paragraphs 5 and 6.

Article 106 Overview of buyers remedies 1. In the case of non-performance of an obligation by the seller, the buyer may do any of the following: (a) require performance, which includes specific performance, repair or replacement of the goods or digital content, under Section 3 of this Chapter; (b) withhold the buyers own performance under Section 4 of this Chapter; (c) terminate the contract under Section 5 of this Chapter and claim the return of any price already paid, under Chapter 17; (d) reduce the price under Section 6 of this

(+) no hierarchy of remedies which is more favourable to consumers (+) CESL contains additional rules which are favourable to the consumer, e.g. the claim for damages, the right to withhold performance and the rule on the return of replaced item were not harmonised in Directive 99/44.

47

Chapter; and (e) claim damages under Chapter 16. 2. If the buyer is a trader: (a) the buyers rights to exercise any remedy except withholding of performance are subject to cure by the seller as set out in Section 2 of this Chapter; and (b) the buyers rights to rely on lack of conformity are subject to the requirements of examination and notification set out in Section 7 of this Chapter. 3. If the buyer is a consumer: (a) the buyers rights are not subject to cure by the seller; and (b) the requirements of examination and notification set out in Section 7 of this Chapter do not apply. 4. If the sellers non-performance is excused, the buyer may resort to any of the remedies referred to in paragraph 1 except requiring performance and damages. 5. The buyer may not resort to any of the remedies referred to in paragraph 1 to the extent that the buyer caused the sellers non-performance.

48

6. Remedies which are not incompatible may be cumulated. Article 110 Requiring performance of sellers obligations 1. The buyer is entitled to require performance of the sellers obligations. 2. The performance which may be required includes the remedying free of charge of a performance which is not in conformity with the contract. 3. Performance cannot be required where: (a) performance would be impossible or has become unlawful; or (b) the burden or expense of performance would be disproportionate to the benefit that the buyer would obtain. Article 111 Consumers choice between repair and replacement 1. Where, in a consumer sales contract, the trader is required to remedy a lack of conformity pursuant to Article 110(2) the consumer may choose between repair and replacement unless the option chosen would be unlawful or impossible or, compared to

3. In the first place, the consumer may require the seller to repair the goods or he may require the seller to replace them, in either case free of charge, unless this is impossible or disproportionate. A remedy shall be deemed to be disproportionate if it imposes costs on the seller which, in comparison with the alternative remedy, are unreasonable, taking into account: - the value the goods would have if there were no lack of conformity, - the significance of the lack of

49

conformity, and - whether the alternative remedy could be completed without significant inconvenience to the consumer. Any repair or replacement shall be completed within a reasonable time and without any significant inconvenience to the consumer, taking account of the nature of the goods and the purpose for which the consumer required the goods. 4. The terms "free of charge" in paragraphs 2 and 3 refer to the necessary costs incurred to bring the goods into conformity, particularly the cost of postage, labour and materials. 5. The consumer may require an appropriate reduction of the price or have the contract rescinded: - if the consumer is entitled to neither repair nor replacement, or - if the seller has not completed the remedy within a reasonable time, or - if the seller has not completed the remedy without significant inconvenience to the consumer.

the other option available, would impose costs on the seller that would be disproportionate taking into account: (a) the value the goods would have if there were no lack of conformity; (b) the significance of the lack of conformity; and (c) whether the alternative remedy could be completed without significant inconvenience to the consumer. 2. If the consumer has required the remedying of the lack of conformity by repair or replacement pursuant to paragraph 1, the consumer may resort to other remedies only if the trader has not completed repair or replacement within a reasonable time, not exceeding 30 days. However, the consumer may withhold performance during that time. Article 112 Return of replaced item 1. Where the seller has remedied the lack of conformity by replacement, the seller has a right and an obligation to take back the replaced item at the sellers expense. 2. The buyer is not liable to pay for any use made of the replaced item in the period prior to the

50

replacement. Article 114 Termination for non-performance 1. A buyer may terminate the contract within the meaning of Article 8 if the sellers non-performance under the contract is fundamental within the meaning of Article 87 (2). 2. In a consumer sales contract and a contract for the supply of digital content between a trader and a consumer, where there is a non-performance because the goods do not conform to the contract, the consumer may terminate the contract unless the lack of conformity is insignificant. Prescription System of a substantive deadline during which the defect has to become manifest combined with a corresponding restriction of the length of a possible prescription period which can be introduced by Member States. Art. 5 (1): The seller shall be held liable under Article 3 where the lack of conformity becomes apparent within two years as from delivery of the goods. If, under national legislation, the rights laid down in Article 3(2) are subject to a limitation period, that period shall not expire within a period of two years from the time of delivery. Different system based on the concept of prescription periods, but similar effects in practice: (+) The period of 2 years within which the consumer can claim remedies Article 179 starts from the Periods of prescription consumer's actual or presumed 1. The short period of prescription is two years. knowledge of the 2. The long period of prescription is ten years or, in non-conformity, not the case of a right to damages for personal injuries, from delivery of the goods. thirty years. Article 180 Commencement The system under the CESL, which is

6. The consumer is not entitled to have the contract rescinded if the lack of conformity is minor.

51

1. The short period of prescription begins to run from the time when the creditor has become, or could be expected to have become, aware of the facts as a result of which the right can be exercised. 2. The long period of prescription begins to run from the time when the debtor has to perform or, in the case of a right to damages, from the time of the act which gives rise to the right. 3. Where the debtor is under a continuing obligation to do or refrain from doing something, the creditor is regarded as having a separate right in relation to each non-performance of the obligation.

based solely on a prescription period, is more consumerfriendly than the Directive 99/44 in the case where a Member State has implemented exactly Article 5(1)(2) of the Directive. The consumer would have in fact a shorter period to discover the defect as he would have to invoke his rights by seizing a court for example still within a period of 2 years from the time of delivery. Finally, there is an absolute limitation of 10 years from delivery of the goods after which the consumer can no longer claim any remedy. This period which ensures legal certainty is foreseen

52

Notification of non-conformity

Art. 5 (2) Member States may provide that, in order to benefit from his rights, the consumer must inform the seller of the lack of conformity within a period of two months from the date on which he detected such lack of conformity. Member States shall inform the Commission of their use of this paragraph. Art. 5 (3) Unless proved otherwise, any lack of conformity which becomes apparent within six months of delivery of the goods shall be presumed to have existed at the time of delivery unless this presumption is incompatible with the nature of the goods or the nature of the lack of conformity.

for those exceptional circumstances where a defect only becomes apparent at a very late stage. However, after 6 months from delivery, the consumer would need to prove that the defect existed at the time of the passing of the risk. (+) No notification period

Burden of proof for nonconformity

Article 105 Relevant time for establishing conformity 1. The seller is liable for any lack of conformity which exists at the time when the risk passes to the buyer under Chapter 14. 2. In a consumer sales contract, any lack of conformity which becomes apparent within six months of the time when risk passes to the buyer is

(=) The CESL establishes a presumption of the existence of the nonconformity at the time when the risk passes to the consumer according

53

See also Article 5(1) defect must exist at the time of delivery.

presumed to have existed at that time unless this is to Article 142 if the incompatible with the nature of the goods or digital defect becomes content or with the nature of the lack of conformity. apparent within six months from that 3. In a case governed by point (a) of Article 101(1) moment. The same any reference in paragraphs 1 or 2 of this Article to protection is the time when risk passes to the buyer is to be read afforded by the as a reference to the time when the installation is Directive 99/44. complete. In a case governed by point (b) of Article 101(1) it is to be read as a reference to the time when the consumer had reasonable time for the installation. 4. Where the digital content must be subsequently updated by the trader, the trader must ensure that the digital content remains in conformity with the contract throughout the duration of the contract. 5. In a contract between a trader and a consumer, the parties may not, to the detriment of a consumer, exclude the application of this Article or derogate from or vary its effect.

Guarantees

Art. 6 Guarantees 1. A guarantee shall be legally binding on the offerer under the conditions laid down in the guarantee statement and the associated advertising. 2. The guarantee shall: - state that the consumer has legal rights under applicable national legislation

Art. 2 (s) CESLR: Definition of commercial guarantee

The CESL does not cover commercial commercial guarantee means any undertaking by guarantees. the trader or a producer to the consumer, in addition to legal obligations under Article 106 in case of lack of conformity to reimburse the price paid or to replace or repair, or service goods or digital content in any way if they do not meet the specifications or any other requirements not related to conformity set 54

governing the sale of consumer goods and make clear that those rights are not affected by the guarantee, - set out in plain intelligible language the contents of the guarantee and the essential particulars necessary for making claims under the guarantee, notably the duration and territorial scope of the guarantee as well as the name and address of the guarantor. 3. On request by the consumer, the guarantee shall be made available in writing or feature in another durable medium available and accessible to him. 4. Within its own territory, the Member State in which the consumer goods are marketed may, in accordance with the rules of the Treaty, provide that the guarantee be drafted in one or more languages which it shall determine from among the official languages of the Community. 5. Should a guarantee infringe the requirements of paragraphs 2, 3 or 4, the validity of this guarantee shall in no way be affected, and the consumer can still rely on the guarantee and require that it be honoured.

out in the guarantee statement or in the relevant advertising available at the time of, or before the conclusion of the contract; Article 13 Duty to provide information when concluding a distance or off-premises contract 1. A trader concluding a distance contract or offpremises contract has a duty to provide the following information to the consumer, in a clear and comprehensible manner before the contract is concluded or the consumer is bound by any offer: (f) where applicable, the existence and the conditions of the trader's after-sale customer assistance, after-sale services, commercial guarantees and complaints handling policy. Article 20 Duty to provide information when concluding contracts other than distance and offpremises contracts 1. In contracts other than distance and off-premises contracts, a trader has a duty to provide the following information to the consumer, in a clear and comprehensible manner before the contract is concluded or the consumer is bound by any offer, if that information is not already apparent from the context:

55

(e) where applicable, the existence and the conditions of the trader's after-sale services, commercial guarantees and complaints handling policy; Binding nature Art. 7 Binding nature 1. Any contractual terms or agreements concluded with the seller before the lack of conformity is brought to the seller's attention which directly or indirectly waive or restrict the rights resulting from this Directive shall, as provided for by national law, not be binding on the consumer. Member States may provide that, in the case of second-hand goods, the seller and consumer may agree contractual terms or agreements which have a shorter time period for the liability of the seller than that set down in Article 5(1). Such period may not be less than one year. Article 108 Mandatory nature In a contract between a trader and a consumer, the parties may not, to the detriment of the consumer, exclude the application of this Chapter, or derogate from or vary its effect before the lack of conformity is brought to the trader's attention by the consumer. (+) Because the CESL does not distinguish between first-hand and second-hand goods. In both cases, the short prescription period cannot be reduced to less than 2 years (see Article 186(5)).

Article 186 Agreements concerning prescription 1. The rules of this Chapter may be modified by agreement between the parties, in particular by either shortening or lengthening the periods of prescription. 2. The short period of prescription may not be reduced to less than one year or extended to more than ten years. 3. The long period of prescription may not be reduced to less than one year or extended to more than thirty years.

56

4. The parties may not exclude the application of this Article or derogate from or vary its effects. 5. In a contract between a trader and a consumer this Article may not be applied to the detriment of the consumer.

57

Table III: Unfair Contract Terms Directive (UCTD): minimum harmonisation directive Existing acquis provision Corresponding provisions of the draft proposal Level of protection for a CSL is in the CSL Exclusions (=) Article 1 (2): Article 80 The contractual terms which reflect Exclusions from unfairness test mandatory statutory or regulatory provisions and the provisions or principles 1. Sections 2 and 3 do not apply to contract terms of international conventions to which the which reflect rules of the Common European Sales Member States or the Community are Law which would apply if the terms did not party, particularly in the transport area, regulate the matter. shall not be subject to the provisions of this Directive. 2. Section 2 does not apply to the definition of the main subject matter of the contract, or to the Article 4(2): appropriateness of the price to be paid in so far as Assessment of the unfair nature of the the trader has complied with the duty of terms shall relate neither to the definition transparency set out in Article 82. of the main subject matter of the contract nor to the adequacy of the price and 3. Section 3 does not apply to the definition of the remuneration, on the one hand, as against main subject matter of the contract or to the the services or goods supplies in exchange, appropriateness of the price to be paid. on the other, in so far as these terms are in plain intelligible language.

Definition of non-individually negotiated terms Burden of proof

Art. 3 (2): A term shall always be regarded as not individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the

(+) Article 3(2) 2nd Article 7 paragraph UCTD is Not individually negotiated contract terms not necessary since 1. A contract term is not individually negotiated if it Article 7 CESL speaks about terms, 58

substance of the term, particularly in the context of a pre-formulated standard contract. The fact that certain aspects of a term or one specific term have been individually negotiated shall not exclude the application of this Article to the rest of a contract if an overall assessment of the contract indicates that it is nevertheless a pre-formulated standard contract. Where any seller or supplier claims that a standard term has been individually negotiated, the burden of proof in this respect shall be incumbent on him.

has been supplied by one party and the other party not standard has not been able to influence its content. contracts. 2. Where one party supplies a selection of contract terms to the other party, a term will not be regarded as individually negotiated merely because the other party chooses that term from that selection. 3. A party who claims that a contract term supplied as part of standard contract terms has since been individually negotiated bears the burden of proving that it has been. 4. In a contract between a trader and a consumer, the trader bears the burden of proving that a contract term supplied by the trader has been individually negotiated. 5. In a contract between a trader and a consumer, contract terms drafted by a third party are considered to have been supplied by the trader, unless the consumer introduced them to the contract.

Duty of transparency

Art. 5 Sent. 1: In the case of contracts where all or certain terms offered to the consumer are in writing, these terms must always be drafted in plain, intelligible language. Art. 4 (2): 2. Assessment of the unfair nature of the terms shall relate neither to the definition of the main subject matter of the contract

Article 82 Duty of transparency in contract terms not individually negotiated Where a trader supplies contract terms which have not been individually negotiated with the consumer within the meaning of Article 7, it has a duty to ensure that they are drafted and communicated in plain, intelligible language.

(+) The transparency becomes a factor in the unfairness test

59

nor to the adequacy of the price and remuneration, on the one hand, as against the services or goods supplies in exchange, on the other, in so far as these terms are in plain intelligible language.

Art. 83 (2) (a): When assessing the unfairness of a contract term for the purposes of this Section, regard is to be had to [] whether the trader complied with the duty of transparency set out in Article 82. Art. 80 (2): Section 2 does not apply to the definition of the main subject matter of the contract, or to the appropriateness of the price to be paid in so far as the trader has complied with the duty of transparency set out in Article 82.

Interpretation in favour of the consumer

Article 5 Sent. 2: Where there is doubt about the meaning of a term, the interpretation most favourable to the consumer shall prevail. This rule on interpretation shall not apply in the context of the procedures laid down in Article 7 (2). Article 64 Interpretation in favour of consumers 1. Where there is doubt about the meaning of a contract term in a contract between a trader and a consumer, the interpretation most favourable to the consumer shall prevail unless the term was supplied by the consumer. 2. The parties may not, to the detriment of the consumer, exclude the application of this Article or derogate from or vary its effects.

(=)

Unfairness test + factors to be taken into account

Article 3 (1): A contractual term which has not been individually negotiated shall be regarded

(+) Concerning the factors to be taken Article 83 Meaning of "unfair" in contracts between a trader into account, the duty of transparency 60

as unfair if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer. Article 4 (1): Without prejudice to Article 7, the unfairness of a contractual term shall be assessed, taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract or of another contract on which it is dependent.

and a consumer 1. In a contract between a trader and a consumer, a contract term supplied by the trader which has not been individually negotiated within the meaning of Article 7 is unfair for the purposes of this Section if it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer, contrary to good faith and fair dealing. 2. When assessing the unfairness of a contract term for the purposes of this Section, regard is to be had to: (a) whether the trader complied with the duty of transparency set out in Article 82; (b) the nature of what is to be provided under the contract; (c) the circumstances prevailing during the conclusion of the contract; (d) to the other contract terms; and (e) to the terms of any other contract on which the contract depends.

has been added as a factor to the list, which means that the fact that a term was not communicated in plain, intelligible language can contribute to the characterisation of the term as unfair.

Effects

Article 6 1. Member States shall lay down that unfair terms used in a contract concluded Article 79 Effects of unfair contract terms

(=)

61

with a consumer by a seller or supplier shall, as provided for under their national law, not be binding on the consumer and that the contract shall continue to bind the parties upon those terms if it is capable of continuing in existence without the unfair terms.

1. A contract term which is supplied by one party and which is unfair under Sections 2 and 3 of this Chapter is not binding on the other party. 2. Where the contract can be maintained without the unfair contract term, the other contract terms remain binding. Article 81 Mandatory nature The parties may not exclude the application of this Chapter or derogate from or vary its effects.

List of unfair terms

Art. 3 (3): The Annex shall contain an indicative and nonexhaustive list of the terms which may be regarded as unfair. The Annex: 1. Terms which have the object or effect of: (a) excluding or limiting the legal liability of a seller or supplier in the event of the death of a consumer or personal injury to the latter resulting from an act or omission of that seller or supplier (Article 84(a) CESL); (b) inappropriately excluding or limiting the legal rights of the consumer vis--vis the seller or supplier or another party in the

Article 84 Contract terms which are always unfair A contract term is always unfair for the purposes of this Section if its object or effect is to:

(+) Lists of terms which are either always unfair or presumed to be unfair have been added

(a) exclude or limit the liability of the trader for death or personal injury caused to the consumer (+) Additional terms through an act or omission of the trader or of in both lists; although these lists someone acting on behalf of the trader; are exhaustive, (b) exclude or limit the liability of the trader terms which are not for any loss or damage to the consumer on the lists could fall caused deliberately or as a result of gross under the general unfairness test in negligence; Article 83 of CESL. (c) limit the trader's obligation to be bound by commitments undertaken by its authorised agents or make its commitments subject to 62

event of total or partial non-performance or inadequate performance by the seller or supplier of any of the contractual obligations, including the option of offsetting a debt owed to the seller or supplier against any claim which the consumer may have against him (Article 85(b) and (c) CESL); (c) making an agreement binding on the consumer whereas provision of services by the seller or supplier is subject to a condition whose realization depends on his own will alone (Article 84(g) CESL); (d) permitting the seller or supplier to retain sums paid by the consumer where the latter decides not to conclude or perform the contract, without providing for the consumer to receive compensation of an equivalent amount from the seller or supplier where the latter is the party cancelling the contract (Article 85(d) CESL); (e) requiring any consumer who fails to fulfill his obligation to pay a disproportionately high sum in compensation (Article 85(e) CESL); (f) authorizing the seller or supplier to dissolve the contract on a discretionary basis where the same facility is not granted to the consumer, or permitting the seller or

compliance with a particular condition the fulfilment of which depends exclusively on the trader; (d) exclude or hinder the consumer's right to take legal action or exercise any other legal remedy, particularly by requiring the consumer to take disputes exclusively to an arbitration system not foreseen generally in legal provisions that apply to contracts between a trader and a consumer; confer exclusive jurisdiction for all disputes arising under the contract to a court for the place where the trader is domiciled unless the chosen court is also the court for the place where the consumer is domiciled; give the trader the exclusive right to determine whether the goods, digital content or related services supplied are in conformity with the contract or gives the trader the exclusive right to interpret any contract term; provide that the consumer is bound by the contract when the trader is not; require the consumer to use a more formal method for terminating the contract within the meaning of Article 8 than was used for conclusion of the contract; 63

(e)

(f)

(g) (h)

supplier to retain the sums paid for services not yet supplied by him where it is the seller or supplier himself who dissolves the contract (Article 85(f) CESL); (g) enabling the seller or supplier to terminate a contract of indeterminate duration without reasonable notice except where there are serious grounds for doing so (Article 85(g) CESL); (h) automatically extending a contract of fixed duration where the consumer does not indicate otherwise, when the deadline fixed for the consumer to express this desire not to extend the contract is unreasonably early (Article 85(h) CESL); (i) irrevocably binding the consumer to terms with which he had no real opportunity of becoming acquainted before the conclusion of the contract (Article 70(1) CESL according to which such terms would not be incorporated into the contract); (j) enabling the seller or supplier to alter the terms of the contract unilaterally without a valid reason which is specified in the contract (Article 85(i) CESL); (k) enabling the seller or supplier to alter unilaterally without a valid reason any characteristics of the product or service to

(i)

grant the trader a shorter notice period to terminate the contract than the one required of the consumer; oblige the consumer to pay for goods, digital content or related services not actually delivered, supplied or rendered; determine that non-individually negotiated contract terms within the meaning of Article 7 prevail or have preference over contract terms which have been individually negotiated.

(j)

(k)

Article 85 Contract terms which are presumed to be unfair A contract term is presumed to be unfair for the purposes of this Section if its object or effect is to: (a) restrict the evidence available to the consumer or impose on the consumer a burden of proof which should legally lie with the trader; inappropriately exclude or limit the remedies available to the consumer against the trader or a third party for nonperformance by the trader of obligations under the contract; inappropriately exclude or limit the right to 64

(b)

(c)

be provided (Article 85(j) CESL); (l) providing for the price of goods to be determined at the time of delivery or allowing a seller of goods or supplier of services to increase their price without in both cases giving the consumer the corresponding right to cancel the contract if the final price is too high in relation to the price agreed when the contract was concluded (Article 85(k) CESL); (m) giving the seller or supplier the right to determine whether the goods or services supplied are in conformity with the contract, or giving him the exclusive right to interpret any term of the contract (Article 84(f) CESL); (n) limiting the seller's or supplier's obligation to respect commitments undertaken by his agents or making his commitments subject to compliance with a particular formality (Article 84(c) CESL); (o) obliging the consumer to fulfil all his obligations where the seller or supplier does not perform his (Article 85(l) CESL); (p) giving the seller or supplier the possibility of transferring his rights and obligations under the contract, where this may serve to reduce the guarantees for the consumer, without the latter's agreement (g)

set-off claims that the consumer may have against the trader against what the consumer may owe to the trader; (d) permit a trader to keep money paid by the consumer if the latter decides not to conclude the contract, or perform obligations under it, without providing for the consumer to receive compensation of an equivalent amount from the trader in the reverse situation; require a consumer who fails to perform obligations under the contract to pay a disproportionately high amount by way of damages or a stipulated payment for nonperformance; entitle a trader to withdraw from or terminate the contract within the meaning of Article 8 on a discretionary basis without giving the same right to the consumer, or entitle a trader to keep money paid for related services not yet supplied in the case where the trader withdraws from or terminates the contract; enable a trader to terminate a contract of indeterminate duration without reasonable notice, except where there are serious grounds for doing so; automatically extend a contract of fixed 65

(e)

(f)

(h)

(Article 85(m) CESL); (q) excluding or hindering the consumer's right to take legal action or exercise any other legal remedy, particularly by requiring the consumer to take disputes exclusively to arbitration not covered by legal provisions, unduly restricting the evidence available to him or imposing on him a burden of proof which, according to the applicable law, should lie with another party to the contract (Article 84(d) CESL). 2. Scope of subparagraphs (g), (j) and (l) (a) Subparagraph (g) is without hindrance to terms by which a supplier of financial services reserves the right to terminate unilaterally a contract of indeterminate duration without notice where there is a valid reason, provided that the supplier is required to inform the other contracting party or parties thereof immediately. (b) Subparagraph (j) is without hindrance to terms under which a supplier of financial services reserves the right to alter the rate of interest payable by the consumer or due to the latter, or the amount of other charges for financial services without notice where there is a valid reason, provided that the supplier is required to inform the other contracting party or parties thereof at the earliest

duration unless the consumer indicates otherwise, in cases where contract terms provide for an unreasonably early deadline for giving notice; (i) enable a trader to alter contract terms unilaterally without a valid reason which is specified in the contract; this does not affect contract terms under which a trader reserves the right to alter unilaterally the terms of a contract of indeterminate duration, provided that the trader is required to inform the consumer with reasonable notice, and that the consumer is free to terminate the contract at no cost to the consumer; enable a trader to alter unilaterally without a valid reason any characteristics of the goods, digital content or related services to be provided or any other features of performance; provide that the price of goods, digital content or related services is to be determined at the time of delivery or supply, or allow a trader to increase the price without giving the consumer the right to withdraw if the increased price is too high in relation to the price agreed at the conclusion of the contract; this does not affect price-indexation clauses, where lawful, provided that the method by which 66

(j)

(k)

opportunity and that the latter are free to dissolve the contract immediately. Subparagraph (j) is also without hindrance to terms under which a seller or supplier reserves the right to alter unilaterally the conditions of a contract of indeterminate duration, provided that he is required to inform the consumer with reasonable notice and that the consumer is free to dissolve the contract (Article 85(i) CESL). (c) Subparagraphs (g), (j) and (l) do not apply to: - transactions in transferable securities, financial instruments and other products or services where the price is linked to fluctuations in a stock exchange quotation or index or a financial market rate that the seller or supplier does not control; - contracts for the purchase or sale of foreign currency, traveller's cheques or international money orders denominated in foreign currency; (d) Subparagraph (l) is without hindrance to price-indexation clauses, where lawful, provided that the method by which prices vary is explicitly described (Article 85(k) CESL).

prices vary is explicitly described; (l) oblige a consumer to perform all their obligations under the contract where the trader fails to perform its own; allow a trader to transfer its rights and obligations under the contract without the consumers consent, unless it is to a subsidiary controlled by the trader, or as a result of a merger or a similar lawful company transaction, and such transfer is not likely to negatively affect any right of the consumer; allow a trader, where what has been ordered is unavailable, to supply an equivalent without having expressly informed the consumer of this possibility and of the fact that the trader must bear the cost of returning what the consumer has received under the contract if the consumer exercises a right to reject performance; allow a trader to reserve an unreasonably long or inadequately specified period to accept or refuse an offer; allow a trader to reserve an unreasonably long or inadequately specified period to perform the obligations under the contract; inappropriately exclude or limit the

(m)

(n)

(o)

(p)

(q)

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remedies available to the consumer against the trader or the defences available to the consumer against claims by the trader; (r) subject performance of obligations under the contract by the trader, or subject other beneficial effects of the contract for the consumer, to particular formalities that are not legally required and are unreasonable; require from the consumer excessive advance payments or excessive guarantees of performance of obligations; unjustifiably prevent the consumer from obtaining supplies or repairs from third party sources; unjustifiably bundle the contract with another one with the trader, a subsidiary of the trader, or a third party, in a way that cannot be expected by the consumer; impose an excessive burden on the consumer in order to terminate a contract of indeterminate duration; make the initial contract period, or any renewal period, of a contract for the protracted provision of goods, digital content or related services longer than one year, unless the consumer may terminate the contract at any time with a termination

(s)

(t)

(u)

(v)

(w)

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period of no more than 30 days.

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Table IV: Late Payment Directive: minimum harmonisation directive Existing acquis provision Corresponding provisions of the draft proposal for a CSL Definitions Art. 2 Definitions These definitions have been implemented in the (6) "statutory interest for late payment" directly into Article 168(5) CESL: means simple interest for late payment at a rate which is equal to the sum of the The interest rate for delayed payment is: reference rate and at least eight percentage points; (a) where the creditor's habitual residence is in a Member State whose currency is the (7) "reference rate" means either of the euro or in a third country, the interest rate following: applied by the European Central Bank to (a) for a Member State whose currency is its most recent main refinancing operation the euro, either: carried out before the first calendar day of the half-year in question, or the marginal (i) the interest rate applied by the interest rate resulting from variable-rate European Central Bank to its most recent tender procedures for the most recent main main refinancing operations; or refinancing operations of the European (ii) the marginal interest rate resulting Central Bank, plus eight percentage points; from variable-rate tender procedures for (b) where the creditor's habitual residence the most recent main refinancing is in a Member State whose currency is not operations of the European Central Bank; the euro, the equivalent rate set by the (b) for a Member State whose currency is national central bank of that Member State, not the euro, the equivalent rate set by its plus eight percentage points. national central bank; (8) "amount due" means the principal sum which should have been paid within the contractual or statutory period of payment, including the applicable taxes, duties, levies or charges specified in the invoice

Level of protection is in the CSL (=) The Directive allows Member States to go beyond the threshold of ECB rate + 8% and impose a higher statutory interest rate. The Regulation which is directly applicable had to provide for a certain interest rate, and it has opted for the rate provided for in the Directive itself.

(=) For reasons of terminological consistency with the rest of the

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or the equivalent request for payment;

Interest on late payment general provisions

Article 166 Interest on late payments 1. Where payment of a sum of money is delayed, the creditor is entitled, without the need to give notice, to interest on that sum from the time when payment is due to the time of payment at the rate specified in paragraph 2. 2. The interest rate for delayed payment is: (a) where the creditor's habitual residence is in a Member State whose currency is the euro or in a third country, the rate applied by the European Central Bank to its most recent main refinancing operation carried out before the first calendar day of the halfyear in question, or the marginal interest rate resulting from variable-rate tender procedures for the most recent main refinancing operations of the European Central Bank, plus two percentage points; (b) where the creditor's habitual residence is in a Member State whose currency is not the euro, the equivalent rate set by the

instrument, the concept of "amount due" is replaced with that of "price due" (see Article 168(1) CESL). (+) provides for cases which fall outside the scope of the Late Payments Directive, e.g. for cases of late payments of obligations other than the obligation to pay the price due (for example, for the obligation to pay damages in respect of a contract concluded under CESL). This is a general rule which will not apply if there is a more specific rule (e.g. Article 168).

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national central bank of that Member State, plus two percentage points. 3. The creditor may recover damages for any further (+) provision on loss. damages for further loss Interest on late payment when debtor is a trader Article 3 Transactions between undertakings 1. Member States shall ensure that, in commercial transactions between undertakings, the creditor is entitled to interest for late payment without the necessity of a reminder, where the following conditions are satisfied: (a) the creditor has fulfilled its contractual and legal obligations; and (b) the creditor has not received the amount due on time, unless the debtor is not responsible for the delay. 2. Member States shall ensure that the applicable reference rate: (a) for the first semester of the year concerned shall be the rate in force on 1 January of that year; (b) for the second semester of the year concerned shall be the rate in force on 1 Article 166 Interest on late payments 1. Where payment of a sum of money is delayed, the creditor is entitled, without the need to give notice, to interest on that sum from the time when payment is due to the time of payment at the rate specified in paragraph 2. Article 168 Rate of interest and accrual 1. Where a trader delays the payment of a price due See also Articles under a contract for the delivery of goods, supply of 123(a) and 126 digital content or provision of related services CESL. without being excused by virtue of Article 88, interest is due at the rate specified in paragraph 5 of this Article. 2. Interest at the rate specified in paragraph 5 starts to run on the day which follows the date or the end of the period for payment provided in the contract. If there is no such date or period, interest at that rate starts to run: (=)

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July of that year. 3. Where the conditions set out in paragraph 1 are satisfied, Member States shall ensure the following: (a) that the creditor is entitled to interest for late payment from the day following the date or the end of the period for payment fixed in the contract; (b) where the date or period for payment is not fixed in the contract, that the creditor is entitled to interest for late payment upon the expiry of any of the following time limits: (i) 30 calendar days following the date of receipt by the debtor of the invoice or an equivalent request for payment; (ii) where the date of the receipt of the invoice or the equivalent request for payment is uncertain, 30 calendar days after the date of receipt of the goods or services; (iii) where the debtor receives the invoice or the equivalent request for payment earlier than the goods or the services, 30 calendar days after the date of the receipt of the goods or services; (iv) where a procedure of acceptance or verification, by which the conformity of the goods or services with the contract is to

(a) 30 days after the date when the debtor receives the invoice or an equivalent request for payment; or (b) 30 days after the date of receipt of the goods, digital content or related services, if the date provided for in point (a) is earlier or uncertain, or if it is uncertain whether the debtor has received an invoice or equivalent request for payment. 3. Where conformity of goods, digital content or related services to the contract is to be ascertained by way of acceptance or examination, the 30 day period provided for in point (b) of paragraph 2 begins on the date of the acceptance or the date the examination procedure is finalised. The maximum duration of the examination procedure cannot exceed 30 days from the date of delivery of the goods, supply of digital content or provision of related services, unless the parties expressly agree otherwise and that agreement is not unfair according to Article 170. 4. The period for payment determined under paragraph 2 cannot exceed 60 days, unless the parties expressly agree otherwise and that agreement is not unfair according to Article 170. 5. The interest rate for delayed payment is: (+) Provision for (a) where the creditor's habitual residence creditors established is in a Member State whose currency is the 73

be ascertained, is provided for by statute or in the contract and if the debtor receives the invoice or the equivalent request for payment earlier or on the date on which such acceptance or verification takes place, 30 calendar days after that date. 4. Where a procedure of acceptance or verification, by which the conformity of the goods or services with the contract is to be ascertained, is provided for, Member States shall ensure that the maximum duration of that procedure does not exceed 30 calendar days from the date of receipt of the goods or services, unless otherwise expressly agreed in the contract and provided it is not grossly unfair to the creditor within the meaning of Article 7. 5. Member States shall ensure that the period for payment fixed in the contract does not exceed 60 calendar days, unless otherwise expressly agreed in the contract and provided it is not grossly unfair to the creditor within the meaning of Article 7. Compensation for recovery costs when debtor is a trader Article 6 Compensation for recovery costs 1. Member States shall ensure that, where interest for late payment becomes payable in commercial transactions in accordance with Article 3 or 4, the creditor is entitled to obtain from the debtor, as a minimum, a

euro or in a third country, the interest rate in third countries. applied by the European Central Bank to its most recent main refinancing operation carried out before the first calendar day of the half-year in question, or the marginal interest rate resulting from variable-rate tender procedures for the most recent main refinancing operations of the European Central Bank, plus eight percentage points; (b) where the creditor's habitual residence is in a Member State whose currency is not the euro, the equivalent rate set by the national central bank of that Member State, plus eight percentage points. 6. The creditor may recover damages for any further loss. (+) Provision on damages for further loss.

(=) Article 169 Compensation for recovery costs 1. Where interest is payable in accordance with Article 168, the creditor is entitled to obtain from the debtor, as a minimum, a fixed sum of EUR 40 or the equivalent sum in the currency agreed for the 74

fixed sum of EUR 40. 2. Member States shall ensure that the fixed sum referred to in paragraph 1 is payable without the necessity of a reminder and as compensation for the creditors own recovery costs. 3. The creditor shall, in addition to the fixed sum referred to in paragraph 1, be entitled to obtain reasonable compensation from the debtor for any recovery costs exceeding that fixed sum and incurred due to the debtors late payment. This could include expenses incurred, inter alia, in instructing a lawyer or employing a debt collection agency. Unfair contract terms relating to interest for late payment when debtor is a trader Article 7 Unfair contractual terms and practices 1. Member States shall provide that a contractual term or a practice relating to the date or period for payment, the rate of interest for late payment or the compensation for recovery costs is either unenforceable or gives rise to a claim for damages if it is grossly unfair to the creditor. In determining whether a contractual term or a practice is grossly unfair to the creditor, within the meaning of the first subparagraph, all circumstances of the case

contract price as compensation for the creditor's recovery costs. 2. The creditor is entitled to obtain from the debtor reasonable compensation for any recovery costs exceeding the fixed sum referred to in paragraph 1 and incurred due to the debtor's late payment.

Article 170 Unfair contract terms relating to interest for late payment

1. A contract term relating to the date or the period for payment, the rate of interest for late payment or the compensation for recovery costs is not binding to the extent that the term is unfair. A term is unfair if it grossly deviates from good commercial practice, contrary to good faith and fair dealing, taking into account all circumstances of the case, The Directive including the nature of the goods, digital content or speaks about "grossly unfair", related service. which has to be determined, inter

(=) In CESL one of the 2 alternative remedies is chosen (i.e. unenforceability of unfair terms). CESL is limited to contractual aspects and does not regulate unfair practices.

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shall be considered, including: (a) any gross deviation from good commercial practice, contrary to good faith and fair dealing; (b) the nature of the product or the service; and (c) whether the debtor has any objective reason to deviate from the statutory rate of interest for late payment, from the payment period as referred to in Article 3(5), point (a) of Article 4(3), Article 4(4) and Article 4(6) or from the fixed sum as referred to in Article 6(1). 2. For the purpose of paragraph 1, a contractual term or a practice which excludes interest for late payment shall be considered as grossly unfair. 3. For the purpose of paragraph 1, a contractual term or a practice which excludes compensation for recovery costs as referred to in Article 6 shall be presumed to be grossly unfair. 2. For the purpose of paragraph 1, a contract term providing for a time or period for payment or a rate of interest less favourable to the creditor than the time, period or rate specified in Articles 167 or 168, or a term providing for an amount of compensation for recovery costs lower than the amount specified in Article 169 is presumed to be unfair.

alia, on the basis of "gross deviation from good commercial practices". The CESL defines "unfair" as a "gross deviation from good commercial practices etc". Despite the difference in wording which is meant to render the text clearer to the user and less repetitive, in substance the test is the same. (+) Article 170(2) sets up a presumption that terms which deviate from Articles 167169 and are less favourable to the creditor are presumed to be unfair.

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(+) Terms excluding compensation for 3. For the purpose of paragraph 1, a contract term recovery costs are excluding interest for late payment or compensation always unfair for recovery costs is always unfair. Mandatory nature Article 7 (1) Member States shall provide that a contractual term or a practice relating to the date or period for payment, the rate of interest for late payment or the compensation for recovery costs is either unenforceable or gives rise to a claim for damages if it is grossly unfair to the creditor. Article 171Mandatory nature The parties may not exclude the application of this Section or derogate from or vary its effects. (=)

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Table V: E-Commerce Directive Existing acquis provision Scope Article 10(4) and 11(3) Paragraphs shall not apply to contracts concluded exclusively by exchange of electronic mail or by equivalent individual communications. Corresponding provisions of the draft proposal Level of protection for a CESL in the CSL is Article 24(1): This Article applies where a trader provides the means for concluding a contract and where those means are electronic and do not involve the exclusive exchange of electronic mail or other individual communication. (=) (=)

Information duty for contracts concluded by electronic means

Article 10 Information to be provided 1. In addition to other information requirements established by Community law, Member States shall ensure, except when otherwise agreed by parties who are not consumers, that at least the following information is given by the service provider clearly, comprehensibly and unambiguously and prior to the order being placed by the recipient of the service: (a) the different technical steps to follow to conclude the contract; (b) whether or not the concluded contract will be filed by the service provider and

Article 24(3) and (4): 3. The trader must provide information about the following matters before the other party makes or accepts an offer: (a) the technical steps to be taken in order to conclude the contract; (b) whether or not a contract document will be filed by the trader and whether it will be accessible; (c) the technical means for identifying and correcting input errors before the other party makes or accepts an offer; (d) the languages offered for the

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whether it will be accessible; (c) the technical means for identifying and correcting input errors prior to the placing of the order; (d) the languages offered for the conclusion of the contract. 2. Member States shall ensure that, except when otherwise agreed by parties who are not consumers, the service provider indicates any relevant codes of conduct to which he subscribes and information on how those codes can be consulted electronically. 3. Contract terms and general conditions provided to the recipient must be made available in a way that allows him to store and reproduce them.

conclusion of the contract; (e) the contract terms. 4. The trader must ensure that the contract terms referred to in point (e) of paragraph 3 are made available in alphabetical or other intelligible characters and on a durable medium by means of any support which permits reading, recording of the information contained in the text and its reproduction in tangible form. Article 16(d): The information to be provided under point (d) of Article 13 (1) must include: (d) where applicable, the existence of relevant codes of conduct and how copies of them can be obtained.

Definitions, Article 2(t) CESLR durable medium means any medium which enables a party to store information addressed personally to that party in a way accessible for future reference for a period of time adequate for the purposes of the information and which allows the unchanged reproduction of the information stored Article 27 Mandatory nature

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In relations between a trader and a consumer, the parties may not, to the detriment of the consumer, exclude the application of this Section or derogate from or vary its effects. Article 11 Placing of the order 1. Member States shall ensure, except when otherwise agreed by parties who are not consumers, that in cases where the recipient of the service places his order through technological means, the following principles apply: - the service provider has to acknowledge the receipt of the recipient's order without undue delay and by electronic means, - the order and the acknowledgement of receipt are deemed to be received when the parties to whom they are addressed are able to access them. 2. Member States shall ensure that, except when otherwise agreed by parties who are not consumers, the service provider makes available to the recipient of the service appropriate, effective and accessible technical means allowing him to identify and correct input errors, prior to the placing of the order. Art. 24 (2) and (5): 2. The trader must make available to the other party appropriate, effective and accessible technical means for identifying and correcting input errors before the other party makes or accepts an offer. 5. The trader must acknowledge by electronic means and without undue delay the receipt of an offer or an acceptance sent by the other party. Article 10(3) and (4)(c): 3. A notice becomes effective when it reaches the addressee, unless it provides for a delayed effect. 4. A notice reaches the addressee (c) in the case of a notice transmitted by electronic mail or other individual communication, when it can be accessed by the addressee; or Article 27 Mandatory nature In relations between a trader and a consumer, the parties may not, to the detriment of the consumer, (=)

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exclude the application of this Section or derogate from or vary its effects.

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