Introduction
Unfair practices
Consumer Protection Service
Consumers' rights
Comment
The Consumer Protection Law of 2021 (Law 112(I)/2021) (CPL), which came into force on 12 May 2021, has increased consumers' rights considerably and as such constitutes a significant reform of the previous legal regime in the field of consumer protection.
One of the purposes of the CPL is to harmonise and consolidate existing legislation in the area, and it has repealed the following laws:
- the Unfair Commercial Practices of Businesses to Consumers Law of 2007;
- the Law relating to the Control of Misleading and Comparative Advertisements of 2000;
- the Unfair Contract Terms Law of 1996;
- the Rights of Consumers Law of 2013;
- the Law on the indication of the Sale Price and Unit Price of the Products offered to Consumers of 2000;
- the Law on Certain Aspects of Sale Consumer Goods and related Guarantees of 2007; and
- the Terms of Sale of Goods at Discount Prices Law of 1990.
In addition, according to the CPL, the requirements of Regulation (EU) 2017/2394 regarding the collaboration of national authorities who are responsible for the enforcement of laws concerning the protection of the consumers are satisfied, thus harmonising national law with that of the European Union.
The CPL prohibits all unfair commercial practices and provides an exhaustive list of such customs. In accordance with Article 5(2) of the CPL, a commercial practice is unfair if it fulfils any or all of the following criteria:
- contrary to the requirements of professional conscientiousness;
- substantially distorts or may substantially distort the economic behaviour of the average consumer to whom a product is delivered or is addressed, or of the average member of the team, whereas a commercial practise is addressed to a particular team of consumers;
- misleading as defined in articles 6 and 7;
- aggressive as defined in Article 1.
One of the most important reforms introduced by the CPL is that the Consumer Protection Service (CPS) can now impose sanctions and administrative fines to those who violate the provisions of the CPL. These are due upon imposition and therefore avoid any delay in payment caused by appeal procedures before the Minister of Commerce and the courts, as was previously the case.
Furthermore, the CPS has the power to issue a restraining order so that a violation can be immediately rectified. A new power afforded to the CPS under the CPL is the ability to buy and try products even with undercover identity (mystery shopping) in place, for the purpose of identifying any violations of the CPL and collecting evidence.
The CPL also limits the period within which an hierarchical appeal can be made before the Minister of Commerce to 30 days from the date of notification of the decision to the violator, and imposes an obligation on the minister to issue a decision within 90 days.
An important safeguard that has been introduced regarding consumers' rights under the CPL is the right of the consumer whose financial interests have been affected to file a lawsuit for any reasonable remedy for rectification or restoration for damages suffered. The consumer may request partial or total compensation, withdrawal from the contract or a reduction on the price of the product. Under the previous legal regime there was no provision for the remedy of compensation for the consumer.
The CPL sets out the information that should be provided to the consumer if such information is not already obvious under the circumstances, and provides that such information should be presented in a clear and comprehensible manner. In the case of non-compliance upon delivery of goods, the consumer has the right either to replacement or repair (free of charge) or to a discount or to withdraw from the contract in accordance with the provisions of the CPL. The CPL establishes a minimum two-year warranty for any new product, applicable upon delivery.
Under the provisions of the CPL, the consumer has also the right, subject to certain exceptions, to withdraw from the contract where it has been made remotely within 14 days from the date of the contract, without being obliged to state the reasons for such withdrawal and without any charges being levied.
Moreover, a seller who provides services to consumers within a commercial store is obliged to display a price list indicating the costs of the services offered. As regards discount periods, the seller must ensure that the current sale price or the amount of reduction (percentage or fraction) and the previous sale price are clearly indicated on the relevant product.
It is important to highlight that the CPL establishes criminal liability in the case of non-compliance, obstruction of the CPS during the exercise of its powers conferred by the CPL and the provision of false information.
Other provisions of the CPL include the obligation of the seller to inform the consumer in writing of its return and exchange policy and the guarantee that the seller provides.
There is no doubt that the implementation of the CPL will benefit not only consumers, who will enjoy an enhanced protection of their rights, but also businesses, since they are provided with clearer and more straightforward guidance in relation to their duties and obligations under the new law.
For further information on this topic please contact Stella Koukounis at Solsidus Law by telephone (+357 22 007700) or email ([email protected]). The Solsidus Law website can be accessed at www.solsiduslaw.com.