Chamber Against Two Proposals of the European Commission for Making Consumer Rights Stricter
The European Commission has published a proposal for the amendment of the directives concerning unfair trade practices and consumer rights, which, among other things, aim to add the so-called green washing and the use of false claims regarding premature ageing of goods among the trade practices. Furthermore, the proposal aims at imposing traders with the obligation to notify consumers of the repairing rating of EU hoods and the planned new warranty related to durability.
The aim of the planned amendments is to achieve a greener and cleaner environmentally friendly circular economy and facilitate more sustainable consumption, allowing consumers to make more conscious choices through legislation.
The Chamber agrees that the plan entails achieving necessary goals, but the changes should not bring along more confusion among consumers or entrepreneurs, because in such case, consumers will not make the more sustainable choices.
No need for warranty related to durability
The European Commission is planning to establish, in addition to the warranty arising from the law (a two-year warranty applicable in the EU) and sales warranty (additional warranty offered by the manufacturer, e.g. 5-year warranty for a fridge) which would be related to durability. This is a sales warranty offered by the manufacturer with the validity of more than two years regarding the durability of the product, during the validity of which, the manufacturer would be liable for the repairs or replacement of the goods (e.g. a 5-year warranty for the durability of the fridge engine).
Should the proposal enter into force, traders would be required to provide information to consumers on that warranty and that applies for any type of goods. The current Consumer Rights Directive foresees that traders are required to provide information to consumers regarding warranty conditions.
In the opinion of the Chamber, the new type of warranty does not make understanding warranty easier for the consumer, on the contrary, it makes it more complicated. Furthermore, three warranties would mean excessive confusion for entrepreneurs who would need to distinguish between and explain to the consumer which warranties have which conditions and term of validity. This, in turn, means that the administrative burden on entrepreneurs increases, because they need to train their employees for three warranties, but also additional costs for producing information materials for the consumers as well as advertising.
That is why the Chamber supports the solution proposed by the Ministry of Economic Affairs and Communications to amend the EU legal acts so that the term of warranty arising from the law would be replaced with the term of general warranty, and the terms of warranty arising from the law and sales warranty would be defined in a simpler manner.
Obligation to notify of the repairability rating should be left out of the draft act
According to the proposal to amend the Consumer Rights Directive, if the amendments enter into force traders are required to inform consumers for all types of goods of the repairability of the goods through the repairability index established with the EU legal acts, or if not available, other relevant repairs information has to be provided (e.g. availability of spare parts and procedure for their ordering), which the manufacturer has made available for the trader. At that, the Commission has not explained in its proposal how the repairability index is formed and who will be assessing the this. For example, it is unclear if the repairability index would be based on the general possibility to disassemble and replace parts of a product, or there should be a provider of repairs services in each member state where the product is sold.
Based on that, the Chamber made a proposal to leave the obligation to notify of the repairability index out of the draft amendment of the directive. Furthermore, the Chamber emphasised that if the repairability index notification obligation is not left out of the draft act, it would be important that the obligation would not become too burdensome on the traders.
Green washing and false claims regarding premature ageing will be considered unfair commercial practices
According to the amendment proposal, the list of unfair commercial practices (so-called black list) included in Annex I of the Unfair Commercial Practices Directive is to be updated with 10 commercial practices that are related to the so-called green washing and premature ageing of goods. If the amendments enter into force, the following would be considered unfair commercial practices: presenting eco labels or other sustainability labels of the label is not based on a certified system, or an environmental claim that the product is made 95 of recycled materials if only 15% of the materials of the product or only the packaging are recycled, or the claim that the product can be repaired although it is designed in a way that it cannot be disassembled for repairs (e.g. hairdryer).
The Chamber agrees with the plan to add the use of green washing and unfair claims regarding premature ageing of goods among the unfair commercial practices, because using such misleading claims is not only detrimental for the consumer, but also distort the entrepreneurship environment and fair competition. However, at the same time, commercial practices should not be added among the misleading commercial practices without thorough analysis and reasoning, and it should not be used to restrict the freedom to do business.
The proposal of the European Commission for empowering consumers for green transition does not reveal when the amendment proposals would be passed. The Chamber presented its positions to the Ministry of Economic Affairs and Communications on 3 June. The ministry will form the Estonian position and send it to the European Commission. Thus, at the moment it is not known when the amendments would enter into force.
The proposal for empowering consumers for green transition is available HERE.