TRADERS AND CONSUMERS

Grazyna Rokicka

Andrea Filippo Gagliardi

TRADER

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 consumer contracts.

Directive 2011/83/EU on consumer rights

CONSUMER

Any natural person,

who, in contracts with traders,

is acting for purposes which are outside

his trade, business, craft or profession.

Directive 2011/83/EU on consumer rights

HOW TO IDENTIFY CONSUMER TRANSACTIONS

Traditionally: B-2-B or B-2-C transactions.

Examples of B-2-B: wholesale distribution, procurement contracts, exchange between traders. B-2-B involves both parties subject to VAT payment.

Examples of B-2-C: retail sales, internet selling (Ebay), tele-selling, door-to-door selling.

Consumer law confers stronger protection to consumers since they are generally perceived as having less information about what they buy (information asymmetry)

RELATIONS BETWEENTRADER AND CONSUMER

Before purchase – Pre contractual obligations to

make the consumer more informed about his choice

During the purchase – The modality of the

conclusion of the contract, i.e. the way the

consensus with the consumer has been obtained After purchase - Complaint or other

mechanisms of redress such as restitution or

substitution of the product

SCOPE OF CONSUMER LAW

CONTRACTS concluded by consumers:sale of goods

sale of services

financial services (banking, insurance)

consumer credit (credit card transactions)

e-commerce

services of general interest (energy, water, telecomm.)

tourism, transport

public services (health, education)

PRE-CONTRACTUAL OBLIGATION

to INFORM CONSUMER on:

The origin, nature, composition and use;

The quality, quantity, category and usual denomination;

The general legal and economic conditions of the sale including complete information on the price including VAT and other taxes;

Date of production and expiry date;

Instructions of use;

Procedure available to consumers to terminate the contract

In consumer claims on the basis of infringement of this general obligation the burden of the proof is on the trader.

PRICE INFORMATION :

1) The trader shall clearly, visibly and legibly state the retail price of products, services he/she provides and spare parts he/she sells with the service, and mark the price in local currency.

  2) The retail price of a product or service, a retail price of a product unit, manufacturing unit or a certain quantity of product shall be the final price for the consumer.

  3) A unit price is a price per one kilogram, one liter, one meter, one square meter or one cubic meter of a product, or some other quantity measure that is generally of usually used in the sale of products.

4) For bulk products, only the unit price of the product shall be stated at the selling point.

  DIRECTIVE 98/6/EC on consumer protection in the indication of the prices of

products offered to consumers

TYPES OF CONTRACTS

• Traditional, in-store• Away from business premises – door-to-door• Distance selling

Information duty increases with distance or when the consumer is hit “cold”, providing for the right of withdrawal within a certain period of time (cooling off).

GENERAL TRADERS OBLIGATIONS

TRADER is obliged to give to consumer:- all documents associated to goods/services as

required by the law, like: manuals, terms of contract;

- all accessories;

- guarantee document (if issued);

- sales receipt/bill/invoice (with the seller's name &

address, date of purchase, specification of goods,

their quantity and price)

- Information on mechanism of redress, including where

applicable the right of cancellation.

TRADER

must deliver goods

which are

in conformity with the contract of sale

Directive 1999/44/EC on certain aspects of the sale of consumer

goods and associated guarantees

MISLEADING OR AGGRESSIVE PRACTICESAlways prohibited:• Including in marketing material an invoice or similar

document seeking payment which gives the consumer the impression that he has already ordered the marketed product when he has not.

• Making persistent and unwanted solicitations by telephone, fax, e-mail or other remote media.

• Demanding immediate or deferred payment for or the return or safekeeping of products supplied by the trader, but not solicited by the consumer.

It is fundamental for traders to record the consensus obtained by the consumer. Without this record, there cannot be a valid transaction.

AFTER PURCHASE

Consumers may act for breach of their rights. Here you have two scenarios:

Restore the status quo ante through reimbursement,

substitution or cancellation

Additional penalties

AFTER PURCHASE

Consumer complaints are a great source of information for traders of:

- Errors in characteristics of the product, including

quality, safety and intended use

- Defectiveness of products

- Consumers, their preferences, expectations and

characteristics

WHY TRADERS TAKE CARE OF THE CONSUMERS:

- to achieve a competitive advantage towards other traders – consumer feedback is key to success

- to avoid legal problems- to build good, long-term relations with consumers- not to violate rules of ethics- because they are consumers, too

CONSUMER PROTECTION INSTITUTIONS

European Parliament – IMCO

http://www.europarl.europa.eu/committees/hr/imco/home.html

European Commission – DG SANCO

http://ec.europa.eu/consumers/index_en.htm

European Consumer Association BEUC

www.beuc.eu

CONSUMER ACQUIS

Directive 99/44/EC on certain aspects of the sale of consumer goods and associated guarantees

Directive 2011/83/EU on consumer rights

Directive 2005/29/EC concerning unfair business-to-consumer commercial practices

Directive 93/13/EEC on unfair terms in consumer contracts

Directive 98/6/EC on consumer protection in the indication of the prices of products offered to consumers

Directive 2008/48/EC on credit agreements for consumers

GOOD BUSINESS PRACTICES

Alternative dispute resolutions schemes, ADR/ODR

CODES OF CONDUCTS

Corporate Social Responsibility, CSR

FAIR TRADE