If you supply goods and services to consumers via the Internet you will need to change your terms and conditions of sale to incorporate the new EU Consumer Rights Directive before the end of 2013. The new directive harmonises consumer rights protection across the EU for all BTC (business to customer) online sales of goods and services. The directive must be implemented into UK law before the end of 2013 (probably in a Consumer Bill of Rights) which will result in the following compulsory rules applying to online sales.
Customers will have 14 days (instead of the current 7 days) to cancel an online contract for no reason, free of charge. The 14 days will start on receipt of goods (where goods, or goods and services, are purchased) and on the date of the contract (where services are purchased). There is an exception for digital content – where the sale is deemed to be concluded from the moment that downloading begins, provided that:
- you have obtained the customer’s prior express consent; and
- the customer has acknowledged that there is no right to cancel.
Suppliers must inform customers of their right to withdraw from the contract within the cooling-off period, otherwise the customer’s right to withdraw will automatically extend to 12 months.
If a contract is cancelled during the cooling-off period, provided that the goods are returned within 14 days of the customer giving notice of cancellation, the supplier must refund:
- the price within 14 days of the cancellation date; and
- the postage costs for returning the goods, unless the supplier clearly informed the customer prior to the contract being concluded, that these costs would not be refunded.
The following minimum information must be provided to customers before online sales are concluded.
- the name and full address of the supplier;
- exactly what is being bought;
- the price (including any additional charges or costs, such as taxes and delivery costs);
The above information must be provided in a way which allows the customer to store, access and reproduce the information for as long as may be necessary in connection with the online sale.
Also note that before the online sale is concluded the total price, including all charges should be made clear. The use of ‘pre-ticked boxes’ to conceal hidden charges will no longer be acceptable.
Goods must be delivered without undue delay and in any case no later than 30 days from the conclusion of the contract.
Surcharges and ‘Hotlines’
Suppliers must not charge customers more for specific payment methods than they pay themselves i.e. fees for using a credit or charge card. In addition customer service telephone numbers must be charged at a basic NOT premium rate.
What to do Next
In preparation for the changes, you should review your current terms and conditions and customer policies now to adapt them to comply with the new rules. Customers are more aware of their online rights and increasingly make complaints. Also, national regulators will also be keen to enforce the new rules and make public examples of non-compliant companies.
Irene Bodle is an IT lawyer specialising in Internet Law and SaaS Agreements with over 10 years experience in the IT sector. If you require assistance with any Internet Law, SaaS, ASP, software on demand contracts or any other IT legal issues contact me:
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