Opinion on the Green Paper on guarantees for consumer goods and after-sales services (94/C 295/02)

On 22 November the Commission decided to consult the Economic and Social Committee, under Article 198 of the Treaty establishing the European Economic Community, on the Green Paper on guarantees for consumer goods and after-sales services.

The Section for the Protection of the Environment, Public Health and Consumer Affairs, which was responsible for preparing the Committee`s work on the subject, drew up its Opinion on 3 May 1994. The Rapporteur was Mr Proumens.

At its 316th Plenary Session (meeting of 1 June 1994), the Economic and Social Committee adopted by a majority with 2 votes against the following Opinion.

1. Preamble

1.1. The harmonization of legislation relating to guarantees and after-sales services in the Single Market of the European Union would appear to be a suitable means of facilitating intra-Community trade. It will also encourage consumers to be less reticent about shopping abroad.

1.2. One only has to compare the laws governing legal guarantees in the different Member States to see that harmonization will encounter difficulties.

1.3. With regard to the last point, the Commission has drawn up as full a summary as possible of the numerous statutory and case-law disparities. The summary has the merit of highlighting the convergence of basic principles.

1.4. The evaluation of the problems will initially be confined to purchases of new consumer durables.

1.5. The areas under analysis, and for which a certain number of solutions are explored, are:

- the legal guarantee;

- commercial guarantees; and

- after-sales services.

2. Preliminary comments

2.1. The Committee is first of all inclined to think that, for the purposes of analysis, it might be useful to divide the purchase of the goods concerned into two types of cross-border purchase.

2.2. Firstly purchases made in a Member State by people living close to its borders in another Member State. There would appear to be a considerable number of such purchases.

2.3. Secondly, the purchase of consumer goods at a considerable distance from the buyer`s Member State. The Commission does not appear to have precise figures on such purchases.

2.4. A survey carried out by the Commission has revealed that 59 % of potential buyers are reluctant to shop in another Member State. This justifies the decision to produce a Green Paper, but the fact remains that buyers will doubtless always look on the distances involved - which can sometimes be considerable - as a disadvantage. They may obviously also be deterred by language difficulties. The solutions formulated as a result of the Green Paper analysis will clearly not eliminate these obstacles.

2.5. We should not, however, lose sight of the inroads being made by distance selling, including mail ordering. This is causing concern to all the economic operators concerned, including consumers.

3. The legal guarantee

3.1. First of all, the Commission has shown that adaptation of the applicable rules of private international law (PIR), even if it is feasible, would present very numerous drawbacks, both for consumers and for manufacturing, import and distribution companies. The Committee therefore concludes that this is not an appropriate solution.

3.2. Harmonization in this field could be considered, because of the differences between laws and regulations and even their application.

3.3. Community-level harmonization of laws and regulations is, in fact, technically possible.

3.4. However, this harmonization could only take one of two forms:

- minimal harmonization, or

- total harmonization.

Given the arguments put forward in favour of the two approaches, we could opt for a mid-way solution, i.e. phased harmonization.

3.5. In this case, the first step would be to draw up a set of basic Community rules incorporating the provisions which are common to the national legislation of all the member countries. This should not involve dismantling or toning down the national regulations.

3.6. The economic operators concerned could then perhaps discuss the ways in which different and divergent provisions could be aligned. Once agreement has been reached on a particular point and evaluated, the Commission could propose a regulation to give it legal force.

3.7. Although the objective criterion, i.e. the product, is given priority for the purposes of the application of the legal guarantee, it should be stressed that the exercise will be limited to new consumer durables.

3.8. 'New consumer goods` is a familiar concept. The Commission will, however, have to provide a clear definition of 'durable`.

3.9. With regard to the 'defect`, which triggers the legal guarantee, the Commission tends towards the notion of 'failure to meet the consumer`s legitimate expectations`. Although this is an acceptable basis for consumers, it can pose problems for manufacturers and distributors. The fact that it does not seem possible for this definition to provide a basis for a completely objective analysis could complicate or increase the number of legal disputes and jeopardize certainty in legal relations. It could, however, be very useful in this area to have recourse to quality certificates issued by national or international bodies (e.g. ISO or Afnor).

3.10. The parties who are liable for a defect should also be more clearly defined. Liability should not be shuffled round from one party to another, as this can only be harmful both to consumers and the other economic players.

3.11. It has been suggested that the consumer could choose who should be liable for the defect and damages. However, this solution would surely lead to an increase in the number of potentially liable parties. Claimants may well be tempted to choose - perhaps wrongly - the party they believe most likely, for financial or commercial reasons, to give them satisfaction. However, it should be noted that very often, in the eyes of the consumer, it is the vendor or the distributor who should be the first party to be tackled. In fact, it is usually the manufacturer who is ultimately responsible.

3.12. If the right of choice was accepted, would it enable the purchaser to choose freely one of the four rights cited by the Commission, i.e. cancellation, partial refund, replacement or repair? The validity of the various remedies varies from one stage to another of the sales process. The conditions for the application of these remedies are not met by a single party.

3.13. In any event, the case for arguing that it should be possible for consumers to obtain information at Community level is made even more compelling by the fact that they are often not very familiar with the legal guarantees of the Member State where they are resident.

The Committee considers that the consumer information centres set up in border areas (where cross-border trade obviously tends to be concentrated) could effectively and systematically provide all the necessary information.

4. The commercial guarantee

4.1. If harmonization of commercial guarantees were complete and compulsory, then these guarantees, which rely on freedom of trade, would in effect become legal guarantees.

4.2. This would not prevent manufacturers and distributors from providing further commercial guarantees in addition to the legal guarantees and the guarantees which have acquired legal status.

4.3. These procedures are particularly feasible for multinational companies. Certain small and medium-sized enterprises might, however, be faced with problems with regard to implementation that they would not always be able to resolve.

4.4. However, in response to the concerns voiced by consumers, the case could be considered for issuing guidelines in this field.

4.5. These guidelines could include, inter alia:

- the relationship between commercial and legal guarantees;

- the content and duration of the guarantee; and

- the procedures to be followed when implementing such guarantees.

4.6. The framework roughed out above should clearly accommodate other aspects, e.g.:

- current national practice;

- practice specific to each product type;

- current practice in dealings between the various sections of the production/distribution chain.

4.7. This set of parameters should be discussed in the Consumer Forum, in particular, with those consumers belonging to the sectors concerned. Codes of conduct laying down the groundwork for a European consumer code, could then be introduced.

4.8. This procedure would provide greater flexibility than a Community directive and ensure better adaptation to circumstances in the various Member States.

4.9. If this is done, it will clearly be necessary to work out how to monitor compliance with the codes, and the action, or sanctions, to be taken against companies which are in breach.

4.10. Even though the views of standards organizations must be sought on certain technical points, this body of codes should obviously not be determined by these organizations alone. After all, the aim is to establish a contractual relationship between consumers and traders/manufacturers.

4.11. Although the creation of a European label may be tempting, it should be stressed that this would essentially favour large companies whose products are identical on every national market. Furthermore, the procedure for the grant of a European label may well create extremely cumbersome bureaucratic structures which the national authorities and business sectors concerned would find very time-consuming.

5. After-sales services

5.1. The underlying problem here essentially concerns available spare parts.

5.2. It should be noted that the Green Paper makes no reference to this.

5.3. The supply of spare parts remains, in the eyes of the Commission a remunerated commercial activity. It should first be stressed that it is in companies` interests to ensure this supply as effectively as possible, since it gives rise to profits.

5.4. It would seem inadvisable to regulate the availability of spare parts, which depend on the specific nature of each product type. However, consideration should be given to the possibility of including in the above-mentioned codes a special clause, appropriate to the products to which the codes refer.

Done at Brussels, 1 June 1994.

The Chairman

of the Economic and Social Committee

Susanne TIEMANN