European Court of Justice Strengthens Consumer Rights in Buy on Account Advertising
Strengthened Transparency in 'Pay on Account' Advertising Ruling - CJEU Decision - Enhancing Transparency in 'Buy Now, Pay Later' Advertising - ECJ Emphasizes Clarity
Hey there! Let's dive into the European Court of Justice's latest decision on advertising "Buy on Account," which has given consumers more rights and transparency when it comes to online shopping.
This dispute centers around how online retailers must prominently highlight a creditworthiness check when advertising a "convenient buy on account." EU law sets high requirements for transparency in sales promotions, and the European Court of Justice has made it clear that special offers and buy on account could fall under these regulations. Still, it's the Federal Court of Justice that needs to make its final ruling on the case.
Remember the fashion retailer Bonprix, owned by the Otto Group? They came under fire from the Consumer Center Hamburg for their "convenient buy on account" offer that didn't clearly state that creditworthiness would be checked. The case made its way up to the Federal Court of Justice, which sought clarification from the European Court of Justice.
Julia Rehberg from the Consumer Center Hamburg expressed her satisfaction with the European Court of Justice's decision: "We are pleased that the European Court of Justice has classified the buy on account as a sales promotion offer and are now confident that the Federal Court of Justice will also decide in favor of consumers." Bonprix, for its part, maintains it communicated appropriately and awaits the final decision from the Federal Court of Justice.
Here's the lowdown on the transparency requirements under EU law:
- Clearly Disclosed Payment Terms: Advertisements for buy on account must fully disclose essential terms and conditions, including deadlines, potential fees, and procedures for taking advantage of the pay-later option.
- Transparency About Costs and Risks: Any additional costs or consequences (like late payment fees or credit checks) related to buying on account must be transparently communicated in the advertising material.
- Compliance with Unfair Commercial Practices Directive: Advertising should not deceive or mislead consumers, and it must comply with the EU’s Unfair Commercial Practices Directive, which prohibits misleading omissions or misleading information that could distort consumers’ economic behavior.
- Digital Services Act (DSA) and Digital Markets Act (DMA) Context: Although the DSA and DMA primarily target platform transparency and user consent for data processing, they support the broader EU framework demanding transparency in digital advertising, which also applies to buy on account advertising. Platforms must provide transparent information about advertisements to ensure consumers are aware of their origin and nature24.
In summary, the European Court of Justice's ruling on Handel Werbung has reinforced the demand for transparent, complete, and truthful information about the payment method and conditions related to buy on account advertising. This transparency encompasses disclosing any fees, payment deadlines, and legal obligations associated with buy on account to help consumers make informed decisions. These requirements are in line with broader EU digital and advertising transparency regulations like the Digital Services Act and the Unfair Commercial Practices Directive, which aim to ensure fairness and clarity in consumer advertising within the Single Market24.
So there you have it! Keep shopping smart, folks, and remember to always read the fine print! 😉
- To enhance the employability of individuals in EC countries, it's essential to invest in vocational training programs, focusing on digital skills and financial literacy in business, as these skills align with the transparency requirements under EU law for online shopping.
- For businesses operating in EC countries, it's crucial to prioritize compliance with the Unfair Commercial Practices Directive when devising employment policies, especially those pertaining to vocational training programs, given the focus on transparency and fairness in the European market.
