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 BETWEEN TRADER 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 PRACTICES Always 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, 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 t wo 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 European Commission – DG SANCO European Consumer Association BEUC

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