Proposal for a Directive of the European Parliament and of the Council concerning the distance marketing of consumer financial services and amending Council Directive 90/619/EEC and Directives 97/7/EC and 98/27/EC
Date: 1998-10-14
Institutions: European Commission
Subjects: consumer protection, contract, distance selling, financial market, single market

C  385/10

EN

Official  Journal  of  the  European  Communities

11.12.98

II

(Preparatory  Acts)

COMMISSION

Proposal  for  a  Directive  of  the  European  Parliament  and  of  the  Council  concerning  the  distance
marketing  of  consumer  financial  services  and  amending  Council  Directive  90/619/EEC  and
Directives  97/7/EC  and  98/27/EC

(98/C  385/10)

(Text  with  EEA  relevance)

COM(1998)  468  final  -  98/0245(COD)

(Submitted  by  the  Commission  on  19  November  1998)

THE  EUROPEAN  PARLIAMENT  AND  THE  COUNCIL
OF  THE  EUROPEAN  UNION,

Having  regard  to  the  Treaty  establishing  the  European
Community,  and  in  particular  Article  57(2)  and  Articles
66  and  100a  thereof,

(4)(cid:217)Whereas  it  is  essential  to  the  smooth  operation  of
the  internal  market  for  consumers  to  be  able  to
negotiate  and  conclude  contracts  with  a  supplier
their  country,  regardless  of
established  outside 
whether  the  supplier 
in  the
consumer’s  country  of  residence;

is  also  established 

Having  regard  to  the  proposal  from  the  Commission,

Having  regard  to  the  opinion  of  the  Economic  and
Social  Committee,

Acting  in  accordance  with  the  procedure  laid  down  in
Article  189b  of  the  Treaty,

(1)(cid:217)Whereas  it  is  important,  in  the  context  of  achieving
the  aims  of  the  single  market,  to  adopt  measures
designed  to  progressively  consolidate  this  market
and  those  measures  must  contribute  to  attaining  a
high  level  of  consumer  protection,  in  accordance
with  Article  129a  of  the  Treaty;

services, 

(2)(cid:217)Whereas,  both  for  consumers  and  suppliers  of
financial 
the  distance  marketing  of
financial  services  will  constitute  one  of  the  main
tangible  results  of  the  completion  of  the  internal
market;

(3)(cid:217)Whereas,  within  the  framework  of  the 

financial 

services  available 

internal
market,  it  is  in  the  interest  of  consumers  to  have
access  without  discrimination  to  the  widest  possible
range  of 
the
Community  so  that  they  can  choose  those  that  are
best  suited  to  their  needs;  whereas  in  order  to
safeguard  freedom  of  choice,  which  is  an  essential
consumer  right,  a  certain  degree  of  protection  is
required  in  order  to  enhance  their  confidence  in
distance  selling;

in 

(5)(cid:217)Whereas  the  establishment  of  a  legal  framework
governing 
financial
the  distance  marketing  of 
services  should  contribute  to  promoting  the  advent
of  the  information  society  and  the  development  of
electronic  commerce;

(6)(cid:217)Whereas  Directive  97/7/EC  of 

the  European
Parliament  and  of  the  Council  of  20  May  1997  on
the  protection  of  consumers  in  respect  of  distance
contracts(cid:216)(˛),  lays  down  the  main  rules  applicable  to
distance  contracts  for  goods  or  services  concluded
between  a  supplier  and  a  consumer;  whereas,
however,  that  Directive  does  not  cover  financial
services;

in 

for 

this 

field, 

specific  measures 
invited  all  the 

(7)(cid:217)Whereas,  in  the  context  of  the  analysis  conducted
by  the  Commission  with  a  view  to  ascertaining  the
need 
the
interested  parties  to
Commission 
transmit  their  comments,  notably 
in  connection
with  the  preparation  of  its  Green  Paper  entitled
"Financial  Services  -  Meeting  Consumers’  Expec(cid:220)
tations’(cid:216)(ˇ);  whereas 
this
context  showed  that  there  is  a  need  to  strengthen
the
consumer  protection 
Commission  therefore  decided  to  present  a  specific
proposal  concerning 
the  distance  marketing  of
financial  services;

this  area;  whereas 

the  consultations 

in 

in 

(˛)(cid:217)OJ  L  144,  4.6.1997,  p.  19.
(ˇ)(cid:217)COM(96)  209  final,  22.5.1996.

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(8)(cid:217)Whereas  the  adoption  by  the  Member  States  of
conflicting  or  different  consumer  protection  rules
governing 
the  distance  marketing  of  consumer
financial  services  would  impede  the  functioning  of
the  internal  market  and  competition  between  firms
in  the  market;  whereas  it  is  therefore  necessary  to
enact  common  rules  at  Community  level  in  this
area;

(9)(cid:217)Whereas,  given 

the  high 

level  of  consumer
protection  guaranteed  by  this  Directive,  with  a  view
to  ensuring  the  free  movement  of  financial  services,
Member  States  may  not  adopt  provisions  other  than
those 
in  the  fields
harmonised  by  this  Directive;

in  this  Directive 

laid  down 

(10)(cid:217)Whereas  this  Directive  covers  all  financial  services
liable 
to  be  provided  at  a  distance;  whereas,
however,  certain  financial  services  are  governed  by
law;  whereas
specific  provisions  of  Community 
those  specific  provisions  continue  to  apply  to  those
financial  services;  whereas  that  applies  in  particular
to  provisions  governing  prior  information  of  the
consumer;  whereas,  however,  it  is  advisable  to  lay
down  principles  governing  the  distance  marketing
of  such  services;

(11)(cid:217)Whereas,  in  accordance  with  the  principles  of  subsi(cid:220)
diarity  and  proportionality  as  set  out  in  Article  3b
of  the  Treaty,  the  objectives  of  this  Directive
cannot  be  sufficiently  achieved  by  the  Member
States  and  can  therefore  be  better  achieved  by  the
Community;  whereas 
is  necessary  by  also
it 
sufficient  to  enact  measures  which  allow  consumers
to  inform  themselves  and  to  consider  the  proposed
contractual 
terms  and  conditions,  as  well  as
measures  to  ensure  that  those  rights  are  respected;
whereas  it  is  also  appropriate  to  enact  measures  to
protect  consumers  against  the  high(cid:220)pressure  selling
of  financial  services  and  against  certain  unsolicited
uses  of  means  of  distance  communication;  whereas
consumers  cannot  fully  enjoy  the  rights  vested  in
them 
appropriate
this  Directive 
arrangements  are  made  for  settling  disputes;

unless 

by 

(12)(cid:217)Whereas  contracts  negotiated  at  a  distance  involve
the  use  of  means  of  distance  communication;
whereas  the  various  means  of  communication  are
used  as  part  of  a  distance  sales  or  service(cid:220)provision
scheme  not  involving  the  simultaneous  presence  of
the 
the
constant  development  of  those  means  of  communi(cid:220)
cation  requires  principles  to  be  defined  that  are
valid  even  for  those  means  that  are  not  yet  in  wide(cid:220)
spread  use;  whereas,  therefore,  distance  contracts
are 
the  offer,  negotiation  and
conclusion  of  which  are  carried  out  at  a  distance;

the  consumer;  whereas 

supplier  and 

to  be 

those 

(13)(cid:217)Whereas  a 

it 

is 

involving 
to  different 

successive
single  contract 
operations  may  be 
legal
subject 
treatment  in  the  different  Member  States,  whereas,
however, 
important  that  this  Directive  be
applied  in  the  same  way  in  all  the  Member  States;
whereas,  to  this  end,  it  is  appropriate  that  this
Directive  should  be  considered  to  apply  to  the  first
of  a  series  of  successive  operations,  or  to  the  first  of
a  series  of  separate  operations  over  a  period  of  time
which  may  be  considered  as  forming  a  whole,  ir(cid:220)
respective  of  whether  that  operation  or  series  of
operations  are  the  subject  of  a  single  contract  or
several  successive  contracts;

(14)(cid:217)Whereas  by  covering  a  service(cid:220)provision  scheme
organised  by  the  financial  services  provider,  this
Directive  aims  to  exclude  from  its  scope  services
provided  on  a  strictly  occasional  basis  and  outside  a
commercial  structure  dedicated  to  the  conclusion  of
distance  contracts;

(15)(cid:217)Whereas 

the 

supplier 

the  person  providing
is 
services  at  a  distance;  whereas  this  Directive  should
however  also  apply  when  one  of  the  marketing
stages  involves  an  intermediary;  whereas,  having
that
regard 
this
involvement, 
Directive  should  apply  to  such  an  intermediary,
irrespective  of  his  legal  status;

the  nature  and  degree  of 
the  pertinent  provisions  of 

to 

(16)(cid:217)Whereas  the  use  of  means  of  distance  communi(cid:220)
cations  must  not  lead  to  an  unwarranted  restriction
on  the  information  provided  to  the  client;  whereas
in  the  interest  of  transparency  this  Directive  lays
down  the  requirements  needed  to  ensure  that  an
appropriate  level  of  information  is  provided  the
consumer  both  before  and  after  conclusion  of  the
contract;  whereas 
the  consumer  must  receive,
before  conclusion  of  the  contract,  the  contractual
terms  and  conditions  so  that  he  can  properly
appraise  the  offer  and  hence  make  a  well  informed
choice;  whereas 
and
conditions  may  not  be  unilaterally  modified  for  a
period  of  14  days  in  order  to  give  the  consumer
time  for  reflection;

contractual 

terms 

the 

(17)(cid:217)Whereas  provision  should  be  made  for  a  right  of
withdrawal  on  the  part  of  the  consumer,  without
penalty  and  without  having  to  furnish  grounds,
whenever  the  contract  has  been  concluded  by  the
consumer  without  his  having  received,  at  the  time
of  conclusion  of  the  contract,  the  contractual  terms
and  conditions  applicable  to  it,  or  whenever  he  has
induced  to  conclude  the  contract
been  unfairly 
during 
this
Directive;

reflection  period 

set  out 

the 

in 

(18)(cid:217)Whereas  provision  should  be  made  for  a  rein(cid:220)
forcement  of  the  right  of  consumers  to  withdraw
from  contracts  relating  to  mortgages,  life  insurance
and  personal  pension  operations;

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Official  Journal  of  the  European  Communities

11.12.98

(19)(cid:217)Whereas  consumers  should  be  protected  against
unsolicited  sales;  whereas  consumers  should  be
exempt  from  any  obligation  in  the  case  of  unsol(cid:220)
icited  supplies,  the  absence  of  a  reply  not  being
their  part;
construed  as  signifying  consent  on 
whereas,  however,  this  rule  should  be  without
prejudice  to  the  tacit  renewal  of  contracts  validly
concluded  between  the  parties;

(20)(cid:217)Whereas  Member  States  should  take  appropriate
measures  to  effectively  protect  consumers  who  do
not  wish  to  be  contacted  through  certain  means  of
communication;  whereas  this  Directive  is  without
prejudice  to  the  particular  safeguards  available  to
consumers  under  Community  legislation  concerning
the  protection  of  personal  data  and  privacy;

(21)(cid:217)Whereas,  with  a  view  to  protecting  consumers,  it  is
important 
for  resolving
to  make  arrangements 
disputes;  whereas  there  is  a  need  for  suitable  and
effective  complaint  and  redress  procedures  in  the
Member  States  with  a  view  to  settling  potential
disputes  between  suppliers  and  consumers,  by  using,
where  appropriate,  existing  procedures;

(22)(cid:217)Whereas,  as  regards  consumer  access  to  justice  and
in  particular  to  courts  and  tribunals  in  the  case  of
cross(cid:220)border  disputes,  account  should  be  taken  of
the  Communication  from  the  Commission  to  the
entitled
Council 
"Towards  greater  effectiveness  in  the  adoption  and
enforcement  of  decisions  within 
the  European
Union’(cid:216)(˛);

and  European 

Parliament 

(23)(cid:217)Whereas  Member  States  should  encourage  public
or  private  bodies  established  with  a  view  to  settling
disputes  out  of  court  to  cooperate  to  in  resolving
cross(cid:220)border  disputes;  whereas  such  cooperation
could  in  particular  entail  allowing  consumers  to
submit  to  extra(cid:220)judicial  bodies  in  the  Member  State
of  their  residence  complaints  concerning  suppliers
established  in  other  Member  States;

the  possibility 

(24)(cid:217)Whereas  the  Community  and  the  Member  States
have  entered  into  commitments  in  the  context  of
in
the  WTO  -  General  Agreement  on  Trade 
Services  (GATS)  concerning 
for
to  purchase  banking  and
European  consumers 
investment  services  abroad;  whereas  the  GATS
entitles  Member  States 
for
prudential  reasons,  including  measures  to  protect
investors,  depositors,  policy(cid:220)holders  and  persons  to
whom  a  financial  service  is  owed  by  the  supplier  of
the  financial  service;  whereas  such  measures  should
not 
is
impose  restrictions  going  beyond  what 
required  to  ensure  consumer  protection;

to  adopt  measures 

(25)(cid:217)Whereas 

it 

is  consequently  necessary  to  amend
Council  Directive  90/619/EEC  of  8  November
1990  on  the  coordination  of  laws,  regulations  and
administrative  provisions  relating 
life
insurance,  laying  down  provisions  to  facilitate  the
effective  exercise  of  freedom  to  provide  services
and 
as
amending  Directive 
amended  by  Directive  92/96/EC(cid:216)(—);

79/267/EEC(cid:216)(ˇ), 

to  direct 

(26)(cid:217)Whereas,  in  view  of  the  adoption  of  this  Directive,
it 
is  necessary  to  adapt  the  scope  of  Directive
97/7/EC  and  Directive  98/27/EC  of  the  European
Parliament  and  of  the  Council  of  19  May  1998  on
consumers’
injunctions 
interests(cid:216)((cid:209)),

the  protection  of 

for 

HAVE  ADOPTED  THIS  DIRECTIVE:

CHAPTER  I

SCOPE  AND  DEFINITIONS

Article  1

Scope

1.(cid:218)(cid:217)The  object  of  this  Directive  is  to  approximate  the
laws,  regulations  and  administrative  provisions  of  the
Member  States  concerning  the  distance  marketing  of
consumer  financial  services.

2.(cid:218)(cid:217)In  the  case  of  contracts  for  financial  services
comprising  successive  operations  or  a  series  of  separate
operations  performed  over  time,  the  provisions  of  this
Directive  shall  apply  only  to  the  first  operation,  irre(cid:220)
spective  of  whether  those  operations  are  deemed  by
national  law  to  form  part  of  a  single  contract  or  indi(cid:220)
vidual  separate  contracts.

Article  2

Definitions

For  the  purposes  of  this  Directive:

(a)(cid:217)"distance  contract’  means  any  contract  concerning
financial  services  concluded  between  a  supplier  and  a
consumer  under  an  organised  distance  sales  or
service(cid:220)provision  scheme  run  by  the  supplier,  who,
for  the  purpose  of  that  contract,  makes  use  of  means
of  distance  communication  up  to  and  including  the
time  at  which  the  contract  is  concluded;

(˛)(cid:217)OJ  C  33,  31.1.1998,  p.  3.

(ˇ)(cid:217)OJ  L  330,  29.11.1990,  p.  50.
(—)(cid:217)OJ  L  360,  9.12.1992,  p.  1.
((cid:209))(cid:217)OJ  L  166,  11.6.1998,  p.  51.

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(b) "financial  service’  means  any  service  relating  to  the
activities  of  credit  institutions,  insurance  companies
to 
firms,  as  referred 
or 
in  Council
Directives 
93/22/EEC(cid:216)(ˇ),
89/646/EEC(cid:216)(˛), 
73/239/EEC(cid:216)(—)  and  79/267/EEC(cid:216)((cid:209));  an  indicative
list  of  those  services  is  provided  in  the  Annex;

investment 

conditions  to  the  consumer  in  writing  or  in  a  durable
medium  available  and  accessible  to  him.  The  supplier
may  not  unilaterally  modify  these  terms  for  a  period  of
fourteen  days.

The  parties  may  agree  on  a  longer  period.

(c) "supplier’  means  any  natural  or  legal  person  who,
acting  in  his  commercial  or  professional  capacity,  is
the  actual  provider  of  services  subject  to  contracts
covered  by  this  Directive  or  acts  as  intermediary  in
the  supply  of  those  services  or  in  the  conclusion  of  a
distance  contract  between  those  parties;

(d) "consumer’  means  any  natural  person  resident  in  the
in  contracts
is  acting  for  purposes

territory  of 
covered  by  this  Directive, 
which  are  outside  his  trade,  business  or  profession;

the  Community  who, 

(e) "means  of  distance  communication’  refers  to  any
means  which,  without 
the  simultaneous  physical
presence  of  the  supplier  and  the  consumer,  may  be
used  for  the  distance  marketing  of  a  service  between
those  parties;

to 

store 

(f) "durable  medium’  means  any  instrument  enabling  the
information,  without  himself
consumer 
having  to  record  this  information,  and  in  particular
floppy  disks,  CD(cid:220)ROMs,  and  the  hard  drive  of  the
consumer’s  computer  on  which  electronic  mail 
is
stored;

(g) "operator  or 

supplier  of  a  means  of  distance
communication’  means  any  public  or  private,  natural
or  legal  person  whose  trade,  business  or  profession
involves  making  one  or  more  means  of  distance
communication  available  to  suppliers.

CHAPTER  II

RIGHTS  AND  OBLIGATIONS  OF  THE  PARTIES

However,  consumers  may  conclude  the  contract  before
expiry  of  the  period  referred  to  in  the  first  subparagraph
or  the  agreed  period.

The  consumer’s  silence  at  the  end  of  the  reflection
period  shall  not  be  construed  as  signifying  his  consent.

2.(cid:218)(cid:217)The  periods  referred  to  in  paragraph  1  shall  be
calculated  from  the  day  on  which  the  consumer  receives
the  contractual  terms  and  conditions  in  writing  or  in  a
durable  medium  available  and  accessible  to  him.

the  Annex,  when 

3.(cid:218)(cid:217)Without  prejudice  to  paragraph  1,  in  the  case  of
contracts  concerning  the  financial  services  referred  to  in
points  5  and  7  of 
the  supplier
communicates  the  contractual  terms  and  conditions  to
the  consumer  before  conclusion  of  the  contract,  any
price  which  depends  on  fluctuations 
in  the  financial
market  outside  the  supplier’s  control  shall  be  established
with  the  consumer’s  express  consent  when  the  contract  is
concluded.

4.(cid:218)(cid:217)The  provisions  of  paragraphs  1  and  2  shall  be
without  prejudice  to  the  rules  of  the  Member  States
concerning  the  conclusion  of  contracts,  and  in  particular
the  rules  governing  the  manner  in  which  parties  express
their  consent  to  the  contract.

Article  4

Right  of  withdrawal  after  conclusion  of  the  contract

1.(cid:218)(cid:217)Where  the  contract  has  been  concluded  at  the
consumer’s  request  before  the  contractual  terms  and
conditions  have  been  communicated  to  him  by  the
supplier,  the  supplier  shall  communicate  the  contract  to
the  consumer  in  writing  or  in  a  durable  medium  available
and  accessible  to  him  once  the  contract  has  been
concluded.

Article  3

Right  of  reflection  before  conclusion  of  the  contract

1.(cid:218)(cid:217)Before  conclusion  of  a  distance  contract, 
the
supplier  shall  communicate  all  the  contractual  terms  and

The  consumer  has  a  right  of  withdrawal  for  14  days,
without  incurring  any  penalty  and  without  having  to
indicate  his  grounds.  This  period  shall  be  extended  to
30  days  in  the  case  of  contracts  relating  to  mortgages,
life  assurance  or  personal  pension  operations.

(˛)(cid:217)OJ  L  386,  30.12.1989,  p.  1.
(ˇ)(cid:217)OJ  L  141,  11.6.1993,  p.  27.
(—)(cid:217)OJ  L  228,  16.8.1973,  p.  3.
((cid:209))(cid:217)OJ  L  63,  13.3.1979,  p.  1.

The  withdrawal  period  shall  be  calculated  from  the  day
on  which  the  consumer  receives  the  contractual  terms
and  conditions.

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The  right  of  withdrawal  shall  not  apply  to  contracts
concerning:

(a)(cid:217)the  financial  services  referred  to  in  points  5  and  7  of
the  Annex,  whose  price  depends  on  market  fluc(cid:220)
tuations  outside  the  supplier’s  control;

(b) the  part  of  the  total  price  of  the  financial  service
covered  by  the  contract  on  a  pro  rata  basis  for  the
period  between  the  day  on  which  the  contract  was
concluded  and  the  day  on  which  he  exercises  his
right  of  withdrawal,  where  the  price  cannot  be
determined  by  the  supplier  before  conclusion  of  the
contract.

(b) non(cid:220)life  insurance  policies  of  less  than  one  month’s

duration.

2.(cid:218)(cid:217)Where  the  contract  is  concluded  by  the  consumer
during  the  reflection  period  provided  for  in  Article  3  and
he  has  been  unfairly  induced  to  do  so  by  the  supplier,
the  consumer  shall  have  a  right  of  withdrawal  for
fourteen  days  without  incurring  any  charge  or  penalty,
and  without  prejudice  to  his  right  to  seek  compensation
for  the  damage  he  has  suffered.

When  suppliers  communicate  objective  information  to
the  consumer  on  prices  of  financial  services  that  depend
on  market  fluctuations,  this  shall  not  be  considered  as  an
unfair  inducement.

The  withdrawal  period  shall  run  from  the  conclusion  of
the  contract.

2.(cid:218)(cid:217)The  supplier  shall 
inform  the  consumer,  before
conclusion  of  the  contract,  in  any  way  appropriate  to  the
means  of  distance  communication  used,  of  the  price  or
the  amount  used  as  a  basis  for  calculating  the  price
which  he  will  be  required  to  pay  pursuant  to  paragraph  1
if  he  exercises  his  right  of  withdrawal.

the  consumer  was  duly
that 
Unless  he  can  prove 
informed  about  the  price,  the  supplier  may  not  require
the  consumer  to  pay  any  amount  where  he  exercises  his
right  of  withdrawal.

3.(cid:218)(cid:217)The  supplier  shall,  without  any  undue  delay,  return
to  the  consumer  any  sums  he  has  received  from  him  on
conclusion  of  the  distance  contract,  except  for  the  sums
referred  to  in  paragraph  1.

3.(cid:218)(cid:217)The  consumer  shall  exercise  his  right  of  withdrawal
by  notifying  the  supplier  to  this  effect  in  writing  or  in  a
durable  medium  available  and  accessible  to  the  supplier.

Article  6

Consumer  information

4.(cid:218)(cid:217)Member  States  shall  provide  in  their  legislation  that
if  the  price  of  financial  services  is  fully  or  partly  covered
by  credit  granted  to  the  consumer  by  the  supplier,  or  by
a  third  party  on  the  basis  of  an  agreement  between  the
third  party  and  the  supplier,  the  credit  agreement  is
cancelled,  where  the  right  referred  to  in  paragraph  1  is
exercised,  without  any  penalty  being  imposed  on  the
consumer.

5.(cid:218)(cid:217)The  other  legal  effects  and  conditions  of  with(cid:220)
drawal  shall  be  governed  by  the  law  applicable  to  the
contract.

Article  5

Payment  for  the  service  provided  before  withdrawal

1.(cid:218)(cid:217)Where  the  consumer  exercises  his  right  of  with(cid:220)
drawal  under  Article  4(1),  he  may  be  required  to  pay,
without  any  undue  delay,  only:

The  supplier  shall  inform  the  consumer,  in  a  clear  and
comprehensible  manner,  of  his  rights  pursuant  to  Articles
3  and  4,  prior  to  conclusion  of  the  contract,  in  any
manner  appropriate  to  the  means  of  distance  communi(cid:220)
cation  used.

Article  7

Communication  using  a  durable  medium

Communication  of  the  contractual  terms  and  conditions
provided  for  in  Articles  3  and  4  may  be  effected  in
writing  or  in  a  durable  medium  available  and  accessible
to  the  consumer,  notwithstanding  any  other  provision
which  provides  that  such  communication  may  only  be  in
writing.

Article  8

Unavailability  of  the  service

(a)(cid:217)the  price  of  the  financial  service  actually  provided  by
the  supplier,  where  that  price  can  be  determined  by
the  supplier  before  conclusion  of  the  contract;

1.(cid:218)(cid:217)If  the  financial  service  which  is  the  subject  of  the
contract  is  partly  or  totally  unavailable,  the  supplier  shall
duly  inform  the  consumer  without  any  undue  delay.

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2.(cid:218)(cid:217)If  the  financial  service  is  totally  unavailable,  the
supplier  shall,  without  any  undue  delay,  reimburse  any
sum  paid  by  the  consumer.

3.(cid:218)(cid:217)If  the  financial  service  is  only  partly  available,  the
contract  may  only  be  performed  with  the  express  consent
of  the  consumer  and  the  supplier.

Failing  this,  the  supplier  shall  return  to  the  consumer  any
sums  paid  by  him.

Where  the  service  is  only  partly  performed,  the  supplier
shall  return  to  the  consumer  all  sums  relating  to  the  part
of  the  service  that  has  not  been  performed.

Article  9

Unsolicited  services

1.(cid:218)(cid:217)Without  prejudice  to  the  legal  rules  of  the  Member
States  concerning  the  tacit  extension  of  contracts,  the
distance 
to
consumers  shall  be  prohibited.

supply  of  unsolicited 

financial 

services 

Article  11

Imperative  nature  of  the  provisions  of  this  directive

1.(cid:218)(cid:217)Consumers  may  not  waive  the  rights  conferred  on
them  by  this  Directive.

2.(cid:218)(cid:217)Member  States 
for  appropriate
penalties  in  the  event  of  the  supplier’s  failure  to  comply
with  Articles  6  and  10.

shall  provide 

In  such  cases  they  shall  give  consumers  the  right  to
cancel  the  contract  at  any  time,  without  charge  or
penalties,  and  ensure  that  they  are  compensated  for  any
damage  they  have  suffered  without  any  undue  delay.
Such  compensation  may 
include  reim(cid:220)
bursement  of  sums  paid  by  the  consumer  to  the  supplier
in  performance  of  the  contract.

in  particular 

3.(cid:218)(cid:217)Consumers  may  not  be  deprived  of  the  protection
granted  by  this  Directive  where  the  law  governing  the
contract  is  that  of  a  third  country  if  the  consumer  is
resident  on  the  territory  of  a  Member  State  and  the
contract  has  a  close  link  with  the  Community.

2.(cid:218)(cid:217)Consumers  shall  be  exempt  from  any  obligations  in
cases  of  unsolicited  supplies  and  the  absence  of  a
response  shall  not  constitute  consent  by  them.

Article  10

Unsolicited  communications

CHAPTER  III

DISPUTES

Article  12

Settlement  of  disputes

1.(cid:218)(cid:217)The  use  of  automated  calling  systems  without
human  intervention  (automatic  calling  machines)  or  fax
machines  in  marketing  financial  services  at  a  distance
may  be  authorised  only  in  respect  of  consumers  who
have  already  given  their  consent.

1.(cid:218)(cid:217)Member  States  shall  ensure  that  adequate  and
effective  complaints  and  redress  procedures  for 
the
settlement  of  disputes  between  supliers  and  consumers
are  put  in  place,  using  existing  procedures  where  appro(cid:220)
priate.

2.(cid:218)(cid:217)Member  States  shall  take  appropriate  measures  to
ensure  that  communications  not  solicited  by  consumers
and  made  with  a  view  to  selling  distance  financial
services  by  means  other  than  those  referred  to 
in
paragraph  1,

2.(cid:218)(cid:217)The  procedures  referred  to  in  paragraph  1  shall
include  provisions  whereby  one  or  more  of  the  following
bodies,  as  determined  by  national  law,  may  take  action
law  before  the  courts  or  competent
under  national 
administrative  bodies 
the  national
provisions  for  the  implementation  of  this  directive  are
applied:

to  ensure 

that 

(a)(cid:217)shall  not  be  authorised 

if 

the  consent  of 

the

consumers  in  question  has  not  been  given,  or

(a)(cid:217)public  bodies  or  their  representatives;

(b) may  only  be  used  in  the  absence  of  express  prior

objection  from  the  consumers.

(b) consumer  organisations  having  a  legitimate  interest

in  protecting  consumers;

The  measures  referred  to  in  the  first  paragraph  shall  not
entail  costs  for  the  consumer.

(c) professional  organisations  having  a  legitimate  interest

in  acting.

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3.(cid:218)(cid:217)Member  States  shall  encourage  the  public  or  private
bodies  established  for  the  out(cid:220)of(cid:220)court  settlement  of
disputes  to  co(cid:220)operate  in  the  resolution  of  cross(cid:220)border
disputes.

4.(cid:218)(cid:217)Member  States  shall  take  the  measures  necessary  to
ensure  that  operators  and  suppliers  of  means  of  distance
communication  put  an  end  to  practices  that  have  been
declared  to  be  contrary  to  this  Directive,  on  the  basis  of
a 
judicial  decision,  an  administrative  decision  or  a
decision  issued  by  a  supervisory  authority  notified  to
them,  where  those  operators  or  suppliers  are 
in  a
position  to  do  so.

Article  13

Burden  of  proof

The  burden  of  proof  in  respect  of  the  supplier’s  obli(cid:220)
gations  to 
inform  the  consumer  and  the  consumer’s
consent  to  conclusion  of  the  contract  and,  where  appro(cid:220)
priate,  its  performance,  shall  lie  with  the  supplier.

Any  contractual  term  or  condition  providing  that  the
burden  of  proof  of  the  respect  by  the  supplier  of  all  or
part  of  the  obligations  incumbent  on  him  pursuant  to  this
Directive  should  lie  with  the  consumer  shall  be  an  unfair
term  within 
the  meaning  of  Council  Directive
93/13/EEC(cid:216)(˛).

CHAPTER  IV

AMENDMENTS  TO  DIRECTIVES

Article  14

Directive  90/619/EEC

Directive  90/619/EEC  is  amended  as  follows:

2.(cid:217)Paragraph  2  is  replaced  by  the  following:

"2.(cid:218)(cid:217)Member  States  need  not  apply  paragraph  1  to
contracts  of  six  months’  duration  or  less  or  in  cases  in
which,  because  of  the  situation  of  the  policy  holder  or
the  conditions  in  which  the  contract  was  concluded,
the  holder  does  not  need  this  special  protection.
Member  States  shall  indicate  in  their  legislation  the
cases  to  which  paragraph  1  does  not  apply.  However,
where  those  contracts  are  concluded  in  the  circum(cid:220)
stances  referred  to  in  Article  4(1)  and  (2)  of  Directive
.(cid:216).(cid:216)./.(cid:216).(cid:216)./EC,  the  policy  holder  shall  have  a  withdrawal
period  of  14  days(cid:216)(*).

(*)(cid:217)OJ  L 

[Official 

Journal 

reference  of 

this

Directive(cid:129).’

Article  15

Directive  97/7/EC

Directive  97/7/EC  is  amended  as  follows:

1.(cid:217)The  first  indent  of  Article  3(1)  is  replaced  by  the

following:

"- relating  to  financial  services  to  which  Directive
.(cid:216).(cid:216)./.(cid:216).(cid:216)./EC  of  the  European  Parliament  and  of
the  Council(cid:216)(*)  applies.

(*)(cid:217)OJ  L 

[Official 

Journal 

reference  of 

this

Directive(cid:129).’

1.(cid:217)The  first  subparagraph  of  paragraph  1  is  replaced  by

the  following:

2.(cid:217)Annex  II  is  deleted.

individual 

that  a
"1.(cid:218)(cid:217)Each  Member  State  shall  prescribe 
policy(cid:220)holder  who  concludes  an 
life(cid:220)
assurance  contract  shall  have  a  period  of  between  14
and  30  days  from  the  time  when  he  was  informed  that
the  contract  had  been  concluded  within  which  to
cancel  the  contract.  This  period  shall  be  30  days  in
the  cases  referred  to 
in  Article  4(1)  and  (2)  of
Directive  .(cid:216).(cid:216)./.(cid:216).(cid:216)./EC  of  the  European  Parliament  and
of  the  Council(cid:216)(*).

(*)(cid:217)OJ  L 

[Official 

Journal 

reference  of 

this

Directive(cid:129).’

Article  16

Directive  98/27/EC

The  following  point  10 
Directive  98/27/EC:

is  added  to  the  Annex  to

"10. Directive 

.(cid:216).(cid:216)./.(cid:216).(cid:216)./EC 

the  European
Parliament  and  of  the  Council  on  the  distance
marketing  of  consumer  financial  services(cid:216)(*).

of 

(˛)(cid:217)OJ  L  95,  21.4.1993,  p.  29.

Directive(cid:129).’

(*)(cid:217)OJ  L 

[Official 

Journal 

reference  of 

this

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CHAPTER  V

FINAL  PROVISONS

Article  17

Transposition

1.(cid:218)(cid:217)Member  States  shall  bring 
laws,
regulations  and  administrative  provisions  necessary  to
comply  with  this  Directive  by  30  June  2002  at  the  latest.
They  shall  forthwith  inform  the  Commission  thereof.

into  force  the 

At  the  time  of  their  official  publication,  these  provisions
shall  refer  to  this  Directive  or  shall  be  accompanied  by
such  a  reference.  Member  States  shall  determine  how
such  reference  is  to  be  made.

the
shall 
2.(cid:218)(cid:217)Member 
Commission  the  text  of  the  main  laws,  regulations  or

communicate 

States 

to 

administrative  provisions  which  they  adopt  in  the  field
governed  by  this  Directive.  In  that  communication,
Member  States  shall  provide  a  table  showing  the  national
provisions  corresponding  to  each  article  of  this  Directive.

Article  18

Entry  into  force

This  Directive  shall  enter  into  force  on  the  twentieth  day
following  that  of  its  publication  in  the  Official  Journal  of
the  European  Communities.

Article  19

Addressees

This  Directive  is  addressed  to  the  Member  States.

ANNEX

INDICATIVE  LIST  OF  FINANCIAL  SERVICES

1.(cid:217)Acceptance  of  deposits  and  other  repayable  funds

2.(cid:217)Lending,  in  particular  consumer  credit  and  mortgage  loans

3.(cid:217)Financial  leasing

4.(cid:217)Money  transfers,  issuing  and  administering  means  of  payment

5.(cid:217)Foreign  exchange  services

6.(cid:217)Guarantees  and  commitments

7.(cid:217)Reception,  transmission  and/or  execution  of  orders  related  to,  and  services  in  respect  of  or  related  to

the  following  financial  products:
(a)(cid:217)money  market  instruments
(b) transferable  securities
(c) UCITS  and  other  collective  investment  schemes
(d) financial  futures  and  options
(e) exchange  and  interest  rate  instruments

8.(cid:217)Portfolio  management  and  investment  advice  concerning  any  of  the  instruments  listed  under  7

9.(cid:217)Safe(cid:220)keeping  and  administration  of  securities

10.(cid:217)Safe  custody  services

11.(cid:217)Non(cid:220)life  insurance

12.(cid:217)Life  assurance

13.(cid:217)Life  assurance  linked  to  investment  funds

14.(cid:217)Permanent  health  insurance

15.(cid:217)Capital  redemption  operations

16.(cid:217)Individual  pension  schemes