The Future of EU Consumer Protection: What is the way forward?

On 20 November, GSMA Europe hosted a Mobile Meetings Series on consumer protection in the European Union (EU). This blog provides an overview of the main issues raised during the discussion carried out under the Chatham House rule.

The event explored, among other aspects, whether the existing EU policy framework closes the gaps in consumer protection and to what extent both consumers and industry can count on coherent and harmonised rules online and offline, with an outlook to the future of consumer protection in the EU.
Improving consumer protection in the EU has been a priority for the European Commission (EC), in particular in the context of completing the Digital Single Market. In early 2018, the EC published a package of proposals for a ‘New Deal for Consumers’ designed as the new cornerstone of consumer protection in a fast-changing digital world. In achieving this objective, the package seeks to strengthen consumers’ rights and shape the role of industry. Additional legislative proposals support the same objective, including a Directive for the supply of digital content, the Directive on contract rules for the online and other distance sales of goods and the recent Regulation on Platform-to-Business. These proposals, which European legislators are currently negotiating, have the potential to fundamentally change the existing EU consumer protection framework.

Participants agreed that there is a need to modernise consumer protection and to harmonise the horizontal acquis. Additionally, they pointed out how the lack of harmonisation and established traditions in Member States entails different levels of consumer protection and therefore different access to remedies and measures to ensure this protection. Participants, however, warned against overregulation, and agreed that improving implementation and enforcement of existing measures should be considered first.

Participants discussed the objectives of the pending proposals noting with regard to transparency for example, businesses should attempt to strike the right balance between presenting clear and complete information without overloading consumers. This is especially true for the online market place. The discussion also touched upon enforcement mechanisms and remedies as well as explored under which conditions collective redress actions would be triggered. The criteria that determine whether a fine would be levied were extensively discussed. The proposed list provided in the ‘Omnibus’ proposal does not rank the different criteria in a specific order and a number of participants stressed that this could lead to different interpretation across Member States on how calculate penalties. Several participants asserted that if the objective is to deter organisations from practices that harm consumers, more weight should be attached to the ‘intention criterium’, which looks at the intent of an organization to engage in harmful conduct, and the proportion of consumers harmed in relation to the total number of consumers that a business has. Finally, participants discussed situations in which consumers provide personal data as a counter performance, and the extent to which organisations should be allowed to use this information.

After discussing the existing framework and the pending proposals, the discussion shifted to the future of EU consumer protection. Participants stressed that once the proposals have been adopted, much more work is required to ensure timely implementation and robust enforcement. Discussing the future of consumer protection in the EU, ideas were put forward to extend consumer protection rules to other areas of EU law, such as environmental, product labelling and financial rules. Some participants suggested ways to restore consumer trust by focussing on the establishment of a direct relationship with the consumer, rather than via an online intermediary party, particularly online. ‘Some participants suggested ways to restore consumer trust by focussing on the establishment of a direct relationship with the consumer, rather than via an online intermediary party, particularly online.’ Finally, new technologies such as Artificial Intelligence were discussed with a view to identifying the opportunities they may offer for consumer protection.

Participants concluded that effective consumer protection facilitates a relationship of trust between consumers and the trading entity, whilst ensuring a fair level playing field for businesses. The pending proposals offer a step in the right direction for both consumers and businesses, but the current texts still need improvement in order to ensure an effective and balanced legal framework. Their effectiveness will depend on the final text of the proposals.

Hosted in our offices, the Mobile Meetings Series are small scale – but big scope – invitation only events for the Brussels public policy audience. Join us for a different take on the main issues affecting the mobile communications industry and its place in Europe’s information society.

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Take a look at our previous events