Olivia Santantonio
Intellectual Property (IP)
Life Science
Commercial law
Dispute Resolution
Information Governance & Data Protection
Telecommunications, Media & Technology
olivia.santantonio@lydian.be
Nearly one year ago, the EU Parliament adopted the directive No 2019/2161 (better known as the “Omnibus Directive”) as a result of the “New deal for consumers” initiative.
During a webinar co-organized with Lexology on 22 October 2020, Lydian’s team discussed the aims of the Omnibus Directive as well as the main modifications brought by such directive (see below).
However, before examining that directive, Lydian’s team discussed two other important directives, namely directives No 2019/770 (on certain aspects concerning contracts for the supply of digital content and digital services) and No 2019/771 (on certain aspects concerning contracts for the sale of goods). They are not well known by the public (it results indeed from the poll that only the half of the participants had already heard about these directives) but have a big impact for traders of digital sectors, online market platforms and are also linked to the Omnibus Directive and the directives it amends.
Indeed, the directive No 2019/770 applies to a contract where the trader supplies digital content (e.g. movies, photos, e-books, music files) or digital services (e.g. apps such as Netflix and Spotify…) to the consumer and the consumer pays (or undertakes to pay) a price or provides personal data to the trader. The directive No 2019/771 applies to contracts for sale of goods and updates the definition of “goods” (which now also includes goods with digital elements (like smartwatches)) and provides for further warranties obligations and remedies for consumers.
With these new definitions in mind that applies to the Omnibus Directive, Lydian’s team then focused its presentation to solve the puzzle created by that directive.
The Omnibus Directive has two main goals: the modernization of consumer protection rules and a better enforcement of such rules.
In order to achieve the modernization goal, the Omnibus Directive added several obligations in 3 directives: directive 98/6/EC on consumer protection in the indication of the prices of products offered to consumers, directive 2005/29/EC concerning unfair B2C commercial practices and directive 2011/83/EU on consumer rights.
The main modifications to the directive 2005/29/EC on unfair B2C practices are the following:
The main modifications to the directive 2011/83/EU on consumer rights are the following:
The main modifications to the directive 98/6/EC on consumer protection in the indication of the prices of products offered to consumers are new rules on price reductions. Directive 98/6/EC now explicitly provides that price reductions shall indicate the prior price applied by the trader.
The enforcement aspect, mainly translates itself in the introduction of severe, GDPR-like fines in Directives 93/13/EEC on unfair terms in consumer contracts, 2005/29/EC on unfair business-to-consumer commercial practices and 2011/83/EU on consumer rights. It results from our poll that 97% of the participants recognize that such fines motivate their companies to make sure that they comply with the rules.
Hence, what to do to be compliant?
These types of compliance projects often take much longer than one may think. Time is still on our side (the deadline is 28 May 2022). Even though this may seem like a long way out, businesses will need to start their compliance activities well in time (as you may have learned from implementing the GDPR).
In Belgium, we often notice that our legislators stick closely to the text of the directive. Hence, the content of implementing legislation generally is not surprising. However, make sure to follow-up on implementing legislation, to understand the exact scope of the changes in your Member State.
The scope of many consumer protection rules has been broadened. Additional obligations will arise for providers of digital services, digital content and goods (including goods with digital elements). Hence, it is important to re-evaluate the rules that apply to the goods/services you offer and to the means you use to put them on the market (e.g. market platforms, customer reviews, etc.) and think to adapt your website, terms and conditions, pre-contractual information.
We are of course at your disposal should you have any further question or would like to receive an unofficial coordinated version of the 4 directives modified by the Omnibus Directive. Stay tuned in any case for the Belgian legislative implementing developments.
Intellectual Property (IP)
Life Science
Commercial law
Dispute Resolution
Information Governance & Data Protection
Telecommunications, Media & Technology
olivia.santantonio@lydian.be