SEMINAR MARKET SURVEILLANCE IN THE AREA OF CONSUMER PROTECTION Belgrade, 1 February 2013

Building up a system for an effective surveillance of consumer markets 2

3 Our objective To design an adequate set of measures aimed at ensuring that producers and traders comply with the obligations and requirements set out in consumer legislation.

4 Basic principles  proactive v. passive  preventive v. corrective  comprehensive v. piecemeal  planned v. occasional

5 A strategic planning Defining short-, mid- and long-term goals Defining risk detection, assessment and management processes and methodologies Planning checks and controls Setting priorities: e.g., implementation of sectoral surveillance programmes by categories of products, practices or risks Defining performance indicators

6 Basic principles  Legitimacy : surveillance activities and practices based on and within the scope of the relevant provisions of the applicable laws = need to develop MS provisions in the LCP.  Plurality of actors (State, judiciary, NGOs)  Plurality of tools (regulations, codes of conduct, judicial proceedings, out-of-court schemes)  Consistency: clear allocation of responsibilities + institutional coordination

7 Basic principles  Proportionality: - of powers and - of sanctions (Enforcement Pyramid approach = priority to administrative remedial action).  Transparency: motivating decisions, reporting requirements.  Participatory governance: ensuring effective participation of stakeholders, including consumer representatives.

8 Basic principles Participation: National Council for Consumer Protection sub-group Consumer Committee Management of ADRs schemes Management of Codes of conduct Legal standing of consumer organizations before courts

9 Surveillance-related obligations  Setting-up an adequate institutional framework for MS  Enhancing a knowledge-based policy  Providing MS authorities with adequate investigation powers and sanctions, namely to cope with emergency situations  Promoting private enforcement tools and procedures  Developing inter-state /regional administrative cooperation

10 Adequate institutional framework for MS  One clearly designated and well-identified State institution main responsible for MS in the area of consumer protection and also for supervising MS by other competent authorities  Sufficient financial, technical and human resources  The need for a coordinated MS system (among state bodies, national v. regional, state v. non-state)

11 A knowledge-based surveillance policy  Setting-up a national, uniform and computerized system for the collection and registration of consumer complaints. = Consumer Complaints Register: design/users and administrator/use of templates/technical requirements/benefits: more effective access to legal advice, facilitating and uniformizing the handling of consumer complaints, statistical reports and policy analysis..

12 A knowledge-based surveillance policy  Collection and publication of consumer cases dealt with by Courts and by out-of-court schemes.  Use of national data basis: On dangerous goods: NEPRO or Rapid System of Exchange of Information on Dangerous Products  Use of EU data bases: on unfair terms in consumer contracts: CLAB Europa was in operation in the 90s; also see EC Consumer Law Compendium or EU Consumer law Acquis database (until end of 2008):

13 A knowledge-based surveillance policy on unfair commercial practices on consumer complaints (ECCRS - European Consumer Complaints Registration System) eccrs_user_guide.pdf

14 A knowledge-based surveillance policy  Access to EU/international exchange of information networks: on unfair commercial practices: International Consumer Protection and Enforcement Network (ICPEN), formerly known as the Marketing Supervision Network (IMSN): on unsafe products: RAPEX or Rapid Alert System for Non-food Products:

15 Adequate investigation powers and sanctions,  Granting inspectors with broad investigation powers: authorization to enter business premises, taking samples, etc.  Providing for directly applicable administrative sanctions: oral and written warnings cease-and desist orders: orders to stop using unfair terms in consumer contracts, using unfair commercial practice, not complying with the law within a fixed time limit. administrative fines C ONSUMER F UND

16 Adequate investigation powers and sanctions Transposing the EU Directive 2009/22/EC of the European Parliament and of the Council of 23 April 2009 on injunctions for the protection of consumers' interests (Codified version). Actions for a judicial and/or administrative injunction Expedient or summary procedure Possibility to impose a fixed amount for each day’s delay in the event of failure to comply Designation by each member state of the entities qualified to bring an action: state body(ies) in charge of consumer protection, consumer organizations. Arrangements for intra-Community infringements: mutual recognition of legal standing of national entities qualified to bring an action. (+ Report from the Commission concerning the application of Directive 2009/22/EC, COM(2012)635 final, 6 November 2012).

17 Adequate investigation powers and sanctions  More dissuasive criminal penalties Higher amounts of penalties Other criminal sanctions: confiscation of profits, etc.  Ensuring that inspectors are appropriately trained, employ best practices and are supported by continuing professional development.

18 Enhancing private enforcement  Adequate consumer remedies: e.g., choice among refund, replacement or repair  Individual consumer disputes:  Judicial small claims courts/procedures: reduced costs, representation of individual consumers, time limits and less formalism.  Out-of-court disputes resolution schemes based on mediation or arbitration – Consumer-friendly/Quality criteria: e.g., independence, efficiency, transparency = proposals of EU Directives on ADRs and ODRs.

19 Enhancing private enforcement  Collective consumer disputes: clarifying the legal status of collective redress procedures seeking for compensation of the damage caused:  to a group of consumers (opt-in/opt-out)  or to the collective interest of consumers.  Solving the funding issue:  Widening the scope of existing legal aid programmes (especially in favor of consumer groups).  Setting-up a C ONSUMER F UND

20 Inter State/Regional administrative cooperation EC Regulation 2006/2004 on cooperation between national authorities responsible for the enforcement of consumer protection laws (2004) OJ L 364, p.1 to 11. This Regulation provides the legal framework for a cooperation network, which was set up in November 2007 (2007 OJ C 286, p.1). Exchanging information about complaints Handling cross-border consumer complaints Exchanging information about unfair practices Exchanging information about MS measures taken such as injunctions Joint market surveillance activities Cross-border injunctions

21 Inter State/Regional administrative cooperation  Participation to EU/international exchange of information systems ; notification of measures taken against practices contrary to the consumer interest, distribution of information received from other Member States. Product safety area: EU RAPEX Economic interests of consumers: International |Consumer Protection Enforcement Network (see above)