The Netherlands Authority for Consumers and Markets (“ACM”) is well known for its preference for settling violations of the rules that it supervises informally (see also our earlier blog). Possible violations of consumer law are also often settled informally, even though ACM regularly threatens to impose fines in its many information campaigns (see for instance this news report on quotations). So far, ACM has adopted only one infringement decision this year. Another interesting development is that previously imposed fines have been reduced on objection and appeal. At a European level we are awaiting new legislation in the field of geoblocking.
Focus on (rapid) change in behaviour
At present most consumer cases are not settled by means of an infringement decision. ACM usually requests companies to change their sales practices. It accepted, for instance, the commitments given by Direct PC no longer to put pressure on consumers in door-to-door sales. Together with the Dutch Data Protection Authority, it was furthermore able to persuade Stemwijzer.nl to remove its advertising cookies and to review the security of its website. Blendle has also changed its sales practices in response to a warning given by ACM.
By means of an information campaign ACM has also achieved that car preparation fees are included in the advertised prices of new cars. According to ACM most of the sector has complied. Unlike previously reported, ACM now no longer considers it necessary to enforce these rules. ACM had previously stated that it would complete another investigation into the car sector, i.e. the investigation of the Volkswagen scandal, in the spring of this year. There have been no new developments in that area, however.
ACM also enforces consumer law in less traditional sectors. It has taken action, for instance, against vlogger Snapking, who urged viewers to call his premium-rate telephone number. But callers were put on hold for long periods without getting to speak to anyone. In response, ACM not only deactivated Snapking’s number, but also made a vlog itself, which, in our opinion, is a match for that of Snapking himself. Like Snapking, in its vlog ACM kills two birds with one stone by drawing attention to Consuwijzer’s information number. No extra costs are involved in dialling that number.
Finally, ACM has warned consumers about the 123soatest.nl website for STD tests. STD test ordered were often not delivered and returns were often not refunded in time. The company also failed to reply to complaints. It would now appear that the owner has deactivated 123soatest.nl. In its news report ACM states that formal steps may also be taken against the company.
Focus on the energy and travel sectors
The only company fined by ACM this year is power supplier Oxxio. Oxxio is allegedly guilty of recording incorrect customer data in the Contract Termination Register (“CER”). According to ACM, Oxxio wrongly had open-ended contracts (i.e. contracts without an end date) registered with an end date in the CER. Other power suppliers therefore assumed that customers would have to pay Oxxio a fee in order to switch supplier. ACM therefore imposed a fine of €1 million on Oxxio.
Oxxio is not the only energy company whose actions have been scrutinised in the Netherlands. In May of this year ACM reported that it had reviewed invoices from several power companies to check whether they were sufficiently verifiable and understandable for consumers. It also investigated whether the amounts ultimately invoiced were clearly traceable to prices stated in contracts and advertisements and on websites. ACM has stated that fines may be imposed on companies that continue to fail to comply with the applicable rules.
ACM is also keeping a close eye on the travel sector (see our earlier blog). In April of this year, ACM published a letter to the ANVR trade association in which it addressed the manner in which travel providers must state any additional baggage fees. In response to contacts with ACM, Mediamarkt and Kruidvat furthermore changed the conditions of and information on the trips that they offer. The Rotterdam Court upheld a fine imposed on Corendon for incorrectly stating the prices of airline tickets.
Lower fines in objection and appeal proceedings
The decisions in objection and appeal proceedings demonstrate that it is worthwhile litigating against ACM’s fine decisions. On appeal ACM reduced, for instance, fines that it had imposed on the owners of the Hip voor de Heb and Kiesdejuistesportbh.nl web shops. Both owners had been fined €50,000 because their websites incorrectly informed consumers about their right of withdrawal. In the objection proceedings both owners had been able to demonstrate that they were unable to pay the fine. ACM then reduced the fines to €10,000 and €5,000, respectively.
In two appeal proceedings the Rotterdam Court also reduced the fines imposed by ACM. In one case the court granted a € 40.000 fine reduction to a crossword puzzle magazine that allegedly provided misleading information in telemarketing. Since ACM had retracted two violations, there were grounds to reduce the fine in the court’s opinion. The court lowered the fine even further because the proceedings had taken unreasonably long.
In another case the court even halved the fines imposed on a web shop, from €500,000 to €250,000. In the court’s opinion the three violations, which related to the publication of misleading information regarding the right of withdrawal and the right to repayment, were so closely related that ACM’s fine calculation could not be upheld. The court regarded what it referred to as the “more than customary negative publicity” given to the fining decision, such as an interview and reports on personal LinkedIn pages of ACM employees, as further grounds for a reduction of the fine.
In earlier blogs we already reported on the current European fitness check of the main consumer directives. After eighteen months of investigation, the European Commission published the results of that fitness check in May of this year.
In response, the Commission will make proposals to further harmonise certain aspects of consumer law. It is considering, for instance, harmonising the manner in which violations of consumer law are fined. It will consult with Member States and consultation groups in that regard. Other interested parties may also respond to the outcome of the fitness check via public Internet consultation.
Finally, the European legislature has made a great deal of progress with a draft regulation on geoblocking, intended to combat the restrictions on cross-border online trade. As a result of that regulation online providers will have fewer possibilities of differentiating their websites, prices and payment and delivery conditions within the EU. Also, websites will no longer be permitted to automatically reroute visitors without prior consent (see in this regard our blog on e-commerce). It is not yet clear when this regulation will enter into force. We will of course keep you informed of the developments in this field.