The employment of the Consumer Relations Officer

In this newsletter, we would like to draw the attention of companies to the fact that an unqualified consumer relations officer can only be employed until the 31st July 2014 at the latest.

 As of 1 January 2014 the Act CLV of 1997 on Consumer Protection prescribed for companies to employ consumer relations officer if the company meets certain requirements set out in the Act.

 According to Article 17/D of the Act , companies shall employ a consumer relations officer if they

(i)          fall under the scope of the Act on Consumer Protection; and

(ii)         fall under the scope of the Act C of 2000 on Accounting, but

(iii)        do not fall under the scope of the Act on Supporting Small and Medium-sized Enterprises.

 In practical terms, this means the following:

(i)          The Act on Consumer Protection applies to those activities of companieswhich affect or can affect consumers. However, it does not apply to activities of organisations and individuals supervised by the National Bank of Hungary (hereinafter referred to as MNB), acting within its function as supervisory authority of the financial intermediary system (ie, financial services activities).

 Consumer: any natural person who, outside the scope of his trade, business or profession, purchases, orders, receives and uses goods or services, or to whom orders for such goods and services are addressed. In addition, in the application of the provisions pertaining to the arbitration board, a consumer can also be any civil society organization, ecclesiastical legal entity, condominium, association, housing cooperative, micro, small and medium-size enterprise acting for purposes which can be regarded as outside its trade, business or profession.

Business entity: any natural or legal person who is engaged in activities for purposes relating to his trade, business, craft or profession;

(ii)         Business associations fall under the scope of the Accounting Act, subject to the exceptions listed there;

(iii)         According to Article 3 of the Act XXXIV of 2004 on Supporting Small and Medium-sized Enterprises, a small and medium-sized enterprise (“SME”) is an enterprise which

a)    employs less than 250 employees in total, and

b)    has an annual net income not exceeding the forint equivalent to EUR 50 million or an annual balance sheet total not exceeding the forint equivalent to EUR 43 million.

An enterprise is not regarded as an SME in which the state or any local authority holds, either directly or indirectly and either solely or jointly 25 % or more of the capital or voting rights.

In light of the above, those companies whose activities affect consumers and

  • who employ at least 250 people or more (regardless of its incomeor balance sheet total), or
  • whose yearly net income is more than the forint equivalent of EUR 50 million or the principal balance is more than the forint equivalent to EUR 43 million (irrespective of the total number of the employees),

must employ a consumer relations officer.

 Such businesses must employ at least one consumer relations officer in such county or in the capital, where

a)    they have a registered address, place of business or branch that carries out retail sales activities, furthermore

b)    they have a customer service centre, in the case of companies engaged in the pursuit of public service activities, and which are required to operate a customer service centre.

The consumer relations officer must be employed in the largest settlement where the business entity has its registered office or a place of business or branch or a customer service centre.

The responsibilities of the consumer relations officer are the monitoring of the activities affecting the consumers, and organising and delivering training on consumer protection of the employees of the enterprise. The consumer relations officer must keep in regular communication with the authority for consumer protection, with the arbitration boards and with other state organs which also have consumer related responsibilities.

The consumer relations officer shall be a Hungarian citizen or a citizen of any member state of the European Union or any state that is a party of the agreement on the European Economic Area, who

a)    has attained a professional qualification or vocational education in the field of consumer protection, or

b)    has been issued a certificate upon attending an official training course outside the regular school system, assessed in an examination.

Without such a qualification, a consumer relations officer can only be employed until 31stJuly 2014 at the latest.

The activity of the consumer relations officer can be  carried out by an agent on behalf of the business.

The training and examination of consumer relations officers shall be supervised by the Consumer Protection Authority (www.nfh.hu). If the officer passes the examination, the Consumer Protection Authority shall issue a certificate and shall keep records of the certificates issued.

Accordingly, only such a person may qualify as a consumer relations officers, who participates in the training and passes successfully the relevant exams organized by licenced institutions.

Having passed the exam, the Consumer Protection Authority issues a licence to theconsumer relations officer, keeps records on the licences and supervises the operation of the officer and observance of rules. Breaches of the law may result in the Authority imposing a fine.