The Consumer Rights Directive (CRD) was adopted by the European Union on the 10 October 2011. The Directive was originally put forward to create a uniform set of consumer rights across the European Union. The overarching aim of the new Consumer Rights Directive is to achieve a real business-to-consumer internal market, striking the right balance between a high level of consumer protection and the competitiveness of business enterprises.
While the CRD does not have to be implemented by member states for a further 2 years, businesses should be considering what impact this directive may have on its day to day business and prepare accordingly.
The key features of the CRD are:
- A buyer has a 14 day cancellation period which starts from receipt of their goods. The buyer does not have to give a reason for cancellation, and the refund must be paid within 14 days of the cancellation. If a seller fails to inform the buyer of their cancellation rights then the cancellation period is extended to 12 months. This does not apply to certain goods, for example those that arrive sealed and cannot be returned due to hygiene reasons.
- If a delivery date has not been specified then the seller is under an obligation to ensure the goods arrive within 30 days of the date of order. If the goods do not arrive within the 30 days time frame then the buyer has a right to cancel the order. The seller is also responsible for any loss or damage to the goods whilst they are being delivered.
- The seller cannot charge more than it would cost them to process a credit card or debit card payment. This prevents the seller charging excessive fees for processing a credit card payment i.e. up to 3% of the value of the transaction.
- If a seller has a customer service telephone line then the seller cannot charge a premium rate for calling this number. The cost must be charged at a basic rate.
- A seller will not be allowed to have ‘default tick boxes’ on any of their contracts. For example, when a buyer purchases a plane ticket often default tick boxes are applied so that the buyer automatically purchases insurance unless they manually opt out of doing so.
Once the directive is implemented businesses should amend their terms of business for the sale of goods to ensure they comply with the CRD; a failure to do so is likely to cost the business money in the long run i.e. not telling a buyer they have a 14 day cancellation period will automatically increase this time period to 12 months, leading to an increased risk of cancellations and returns.
Websites will also need updating to ensure they comply with the directive, which will have a cost consequence.
For further information on the directive or for assistance with your terms of business please contact Andrea Curtis - andrea.curtis@birkettlong.co.uk
