Proposal for a Regulation of the European Parliament and of the Council on cooperation between national authorities responsible for the enforcement of consumer protection laws ("the regulation on consumer protection cooperation")
Date: 2003-07-18
Institutions: European Commission
Subjects: application of EU law, commercial law, consumer protection, deepening of the European Union, exchange of information, intra-EU trade, legal cooperation, supervisory power

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 18.7.2003
COM(2003) 443 final

2003/0162 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on cooperation between national authorities responsible for the enforcement of
consumer protection laws ("the regulation on consumer protection cooperation")

(presented by the Commission)

EXPLANATORY MEMORANDUM

1.

EXECUTIVE SUMMARY

1.
The effective functioning of the internal market calls for a significant improvement in
the  way  laws  that  protect  consumers  economic  interests  are  enforced  in  cross-border  cases.
The  development  of  cross-border  transactions,  including  through  the  greater  use  of  the
Internet, has made the need for this improvement more urgent. Enlargement further reinforces
the need for action.

2.
The protection of consumers from cross-border infringements requires the creation of
a network of public enforcement authorities throughout the internal market. These authorities
require a minimum of common investigation and enforcement powers. The proposal provides
a  framework  of  mutual  assistance  rights  and  obligations  for  enforcement  authorities  to  use
when  dealing  with  cross-border  infringements.  The  resulting  network  is  designed  to  give
national  enforcement  authorities  an  enforcement  solution  to  deal  quickly  with  the  most
serious rogue traders.

The proposed regulation also provides for wider administrative cooperation among the
3.
Member States and with the Commission on projects of common interest that are designed to
inform and educate consumers and empower  them. The  scope  of  the  proposed  regulation  is
limited  to  cross-border  infringements.  Therefore  the  Member  States  are  not  required  to
change their arrangements for domestic infringements.

2.

THE NEED FOR ACTION

In  2001,  the  Green  Paper  on  EU  Consumer  Protection1  identified  a  gap  in  the
4.
enforcement  of  consumer  protection  laws  relating  to  consumer  economic  interests  in  the
internal market. It argued that there was a need for a legal framework for cooperation between
public authorities responsible for the enforcement of consumer protection laws. It outlined the
possible elements for inclusion in such an instrument.

The  Commission’s  ideas  were  very  favourably  received  by  nearly  all  stakeholders2.
5.
There  was  widespread  agreement  that  such  an  instrument  would  help  secure  the  proper
functioning of the internal market and enhance consumer protection. Business stakeholders in
particular welcomed the Commission’s intentions.

In  the  communication  on  the  follow-up  to  the  Green  Paper3,  the  Commission
6.
undertook  to  present  a  proposal  for  such  a  legal  instrument,  following  further  consultation
with national governments. This consultation took place in the autumn of 2002 and spring of
2003 (including at the informal ministerial meeting at Eretria in May) and broadly confirmed
the orientations of national governments expressed in their responses to the Green Paper and
follow-up communication4. The recent Internal Market Strategy 2003-20065 also argued that

1

2

3

4

COM (2001) 531 final
Responses 
found
to 
at:http://europa.eu.int/comm/consumers/cons_int/safe_shop/fair_bus_pract/green_pap_comm/responses
/index_en.htm
Com (2002) 289 final
Responses to the follow-up communication can be found at:

Green 

Paper 

can 

the 

be 

2

                                                
better  enforcement  was  needed  to  ensure  consumer  confidence  in  the  internal  market  and
identified this proposal as a priority action.

7.
In  addition,  the  Council  adopted  a  resolution  on  2  December  2002  on  the
Community’s  consumer  policy  strategy  2002-2006  that  welcomed  the  Commission’s
intention to make a proposal in this area6. The European Parliament adopted a resolution on
the  consumer  policy  strategy  and  two  resolutions  on  the  Green  Paper  and  follow-up
communication on 13 March 2003 that also welcomed the Commission’s intention to make a
proposal7.

8.
There  is  therefore  a  broad  consensus  that  consistent  and  effective  enforcement  of
consumer  protection  laws  is  essential  to  the  good  functioning  of  the  internal  market,  the
elimination of distortions of competition and the protection of consumers.

9.
The  development  of  cross-border  shopping  has  increased  the  possibility  of  cross-
border infringements. It is increasingly likely that the advertiser or retailer will be located in a
different  jurisdiction  from  the  consumer.  In  only  its  first  sixteen  months  of  operation,  the
European Extra-Judicial Network of alternative dispute resolution bodies (EEJ-net) recorded
1115  cross-border  disputes8.  The  Consumer  Sentinel,  a  US-led  international  enforcement
project,  has  recorded  4100  cross-border  complaints  from  consumers  against  traders  in  EU,
EEA and acceding countries since 1999, over half of which occurred in January to September
20029.

The  development  of  e-commerce,  the  arrival  of  Euro  notes  and  coins  and  the  more
10.
widespread  use  of  common  languages  are  likely  to  increase  cross-border  shopping  still
further. The greater use of cross-border advertising and marketing through post, the  Internet
and  television  will  have  an  important  part  to  play  in  stimulating  cross-border  shopping.
However, unless backed by effective enforcement, the freedoms of cross-border trade and e-
commerce  could  become  freedom  for  rogue  traders  to  undermine  the  internal  market  and
harm  consumers  with  impunity.  The  European  Advertising  Standards  Alliance  (EASA)
estimates  that  around  63%  of  the  cross-border  complaints  received  between  1992  and  2002
concern rogue or peripheral traders and that this figure rises to around 86% for direct mail10.

11.
Consumer  confidence  in  cross-border  shopping  in  the  internal  market  depends,  in
large part, on effective cross-border enforcement. In a recent Eurobarometer survey, 43% of
those  consumers  who  were  less  confident  in  cross-border  shopping  said  that  enabling  their
own national authorities to intervene abroad on their behalf was very important in increasing

http://europa.eu.int/comm/consumers/cons_int/safe_shop/fair_bus_pract/green_pap_comm/responses_f
ollowup/index_en.htm
Internal Market Strategy: Priorities 2003-2006 COM (2003) 238 final
Council Resolution of 2 December 2002 on Community consumer policy strategy 2002-2006 OJ C11 of
17.01.2003 p1
European Parliament resolution on the implications of the Commission Green Paper on European Union
Consumer  Protection  for  the  future  of  EU  consumer  policy  (COM(2001)  531  -  C5-0295/2002  -
2002/2151(COS)), European Parliament resolution on prospects for legal protection of the consumer in
the light of the Commission Green Paper on European Union Consumer Protection (COM(2001) 531 -
C5-0294/2002 - 2002/2150(COS)), European Parliament resolution on the Commission communication
to the European Parliament, the Council, the Economic and Social Committee and the Committee of the
Regions  on 
-
2002/2173(COS))
http://europa.eu.int/comm/consumers/redress/out_of_court/eej_net/index_en.htm
http://www.ftc.gov/bcp/conline/edcams/crossborder/PDFs/Cross-BorderCY-2002.pdf
Source: EASA estimate of their own cross-border complaints figures

'Consumer  Policy  Strategy  2002-2006' 

(COM(2002)  208 

-  C5-0329/2002 

5

6

7

8

9

10

3

                                                                                                                                                        
their  confidence.  A  further  33%  said  that  such  a  measure  would  be  important11.  Business
confidence in a level playing field also depends on the guarantee of consistent and effective
enforcement throughout the internal market.

12.
Each Member State has developed an enforcement system adapted to its own laws and
institutions. Each system has come into being in order to tackle purely domestic infringements
and is not fully adapted to the challenges of the internal market. Domestic authorities lack the
power to investigate infringements outside their jurisdiction. Some are also restricted in acting
against  traders  within  their  own  jurisdiction  who  are  directing  their  activities  at  foreign  but
not  domestic  consumers.  National  authorities  are  also  under  no  obligations  to  assist  their
counterparts in other Member States.

The  result  is  a  system  of  enforcement  in  the  internal  market  that  has  not  adapted
13.
sufficiently to meet the demands of the internal market and is not, at present, able to meet the
challenge posed by rogue traders seeking to exploit the potential of the Internet in particular.
The  enlargement  of  the  internal  market  in  2004  is  likely  to  significantly  increase  the
enforcement  challenges  that  already  exist  and  further  highlight  the  inadequacies  of  current
arrangements.

This analysis of the importance of the enforcement cooperation to the internal market
14.
is  hardly  new.  It  has  been  recognised  in  several  policy  fields,  notably  customs12,  indirect
taxation13,  competition14,  financial  services15  and  food16  and  product  safety  that  the  greater
development of cross-border trade requires the development of a more rigorous EU approach.

15.
The need for effective cross-border enforcement for consumer protection has also been
recognised  in  the  international  domain.  In  1999  the  OECD  adopted  a  recommendation  on
consumer  protection  in  relation  to  e-commerce  that  stated  that  member  countries  should
through  ‘their  judicial,  regulatory  and  law  enforcement  authorities  co-operate  at  the
international 
information  exchange,  coordination,
through 
communication  and  joint  action  to  combat  cross-border  fraudulent,  misleading  and  unfair
commercial  conduct’17.  On  11  June  2003,  the  OECD  adopted  further  guidelines  protecting
consumers  from  cross-border  fraudulent  and  deceptive  commercial  practices  that  recognise
that the same enforcement problems and inadequacies of existing systems exist worldwide18.

level,  as  appropriate, 

11

12

13

14

15

16

17

18

http://europa.eu.int/comm/consumers/cons_int/safe_shop/fair_bus_pract/green_pap_comm/studies/index_en.htm
Council  Regulation  515/97  of  13  March  1997  on  mutual  assistance  between  the  administrative
authorities of the Member States and cooperation between the latter and the Commission to ensure the
correct application of the law on customs and agricultural matters OJ L 082 of 22/03/1997 p1
Proposal for a Council Regulation on administrative cooperation in the field of value added tax COM
(2001) 294 final OJ C270 of 25.09.2001 p 87 – now the subject of a common position
Council  Regulation  (EC)  No  1/2003  of  16  December  2002  on  the  implementation  of  the  rules  on
competition laid down in Articles 81 and 82 of the Treaty OJ L1 of 4.01.2003 p1
Proposal  for  a  directive  of  the  European  Parliament  and  of  the  Council  on  investment  services  and
regulated  markets  COM  (2002)  625  (01)  and  the  recently  adopted  directive  on  insider  dealing  and
market manipulation (market abuse) - common position: OJ C 228 E of 25.09.2002 p19.
Proposal  for  a  regulation  of  the  European  Parliament  and  of  the  Council  on  official  feed  and  food
controls COM (2003) 52 final
Recommendation of the Council of the OECD concerning Guidelines  for  Consumer  Protection  in  the
context of electronic commerce, adopted on 9 December 1999 [C(99)184/FINAL]
http://www.oecd.org/sti/crossborderfraud

4

                                                
16.
Some initiatives have been taken at EU and international level to address these issues.
The  Injunctions  Directive19  gives  certain  bodies,  notably  consumer  associations,  nominated
by the Member States the right to seek injunctions in courts in other Member States against
rogue  traders.  The  International  Marketing  Supervision  Network  (IMSN)  recently  re-named
the  International  Consumer  Protection  Enforcement  Network  (ICPEN)  provides  a  bi-annual
opportunity for enforcement officials from several countries to cooperate informally. An EU
sub-group also meets bi-annually to discuss issues related to EU law.

In  addition  some  Member  States  have  signed  bilateral  cooperation  agreements.  The
17.
most  notable  of  these  is  the  cooperation  agreement  between  the  four  Nordic  enforcement
authorities.

These initiatives have an important part to play in the enforcement dimension of EU
18.
consumer  protection.  They  are  not  however  sufficient.  As  in  other  internal  market  policy
fields, a network is needed of  enforcement authorities in each Member State linked  through
reciprocal rights and obligations (‘mutual assistance’). This network needs a legal basis, not
least to overcome the legal barriers to cooperation that have been identified.

3.

3.1

THE REGULATION ON CONSUMER PROTECTION COOPERATION

Chapter 1: Objective, definitions, scope and competent authorities

3.1.1

Objective

19.
The overall goals of the regulation are to ensure the smooth functioning of the internal
market  and  the  effective  protection  of  consumers  participating  in  the  internal  market.  The
proposed regulation has two specific objectives to achieve these goals, both related to the way
the Member States and in particular their competent authorities cooperate with each other and
with the Commission to protect consumers’ economic interests. They are:

–  to  provide  for  cooperation  between  enforcement  authorities  in  dealing  with  intra-

Community infringements that disrupt the internal market;

–  to  contribute  to  improving  the  quality  and  consistency  of  enforcement  of  consumer
protection laws and to the monitoring of the protection of consumer economic interests.

20.
The  first  objective  is  designed  to  ensure  that  enforcement  authorities  can  cooperate
efficiently  and  effectively  with  their  counterparts  in  other  Member  States.  The  second
objective recognises that the EU can contribute to raising the standard of enforcement through
common projects and the exchange of best practice on a wide range of information, education
and  representation  activities.  It  also  acknowledges  the  EU  contribution  to  monitoring  the
functioning of the internal market.

21.
These goals and objectives have determined the choice of legal base and instrument.
The Commission has opted for Article 95 of the Treaty as a legal base . There are a number of
examples of the barriers to efficiently and effectively tackling cross-border rogue traders that
disrupt the smooth functioning of the internal market:

19

Directive 98/27/EC of the European Parliament and of the Council of 19.05.1998 on injunctions for the
protection of consumers’ interests. (OJ L 166 of 11.06.1998, pp. 51-56)

5

                                                
(cid:1)  A public authority in the Member State of the consumer may be prevented, under national
confidentiality rules, from communicating the necessary information requesting assistance
from an authority in the Member State of the trader.

(cid:1)  The public authority in the Member State of the trader is unable to act on behalf of foreign
consumers, lacks the powers or resources to investigate or act or simply refuses to act, on
grounds of national interest, rather than the Community interest. The public authority may
also  lack  the  power  to  seek  injunctions  to  cease  a  practice  quickly,  thus  having  to  use
criminal law procedures.

(cid:1)  No public authority exists in the Member State of the trader to investigate the infringement

and to seek an injunction against the trader.

(cid:1)  No public authority exists in the Member State of the consumer to seek the assistance of a

public authority in the Member State of the trader.

(cid:1)  No obligations exist between Member States to provide mutual assistance in cross-border

cases.

These  barriers  to  cross-border  enforcement  mean  that  a  rogue  trader  can  evade
22.
enforcement  relatively  easily  either  by  targeting  consumers  in  another  jurisdiction  or  by
targeting their own consumers but from another jurisdiction. Consequently, traders respecting
the  law  suffer  from  a  competitive  disadvantage  from  this  lack  of  effective  cross-border
enforcement, leading to a distortion of competition.

23.
These barriers to cross-border enforcement are also likely to inhibit the development
of  consumer  confidence  in  cross-border  shopping  in  the  internal  market  and  thus  cause
obstacles  to  the  take-up  of  goods  and  services  cross-border.  The  proposed  Regulation  thus
both  contributes  to  removing  distortions  of  competition  and  to  eliminating  internal  market
obstacles.

24.
The  Injunctions  Directive,  which  also  aims  at  improving  enforcement  of  consumer
protection rules, provides one precedent for the use of Article 95 for enforcement questions.
Existing  directives  on  data  protection  and  investment  services,  which  also  provide  for  the
establishment of public bodies with investigative and enforcement powers are also based on
Article 95.

25.
A regulation has been chosen (as has been the practice in other such EU cooperation
instruments,  notably  those  on  customs  cooperation,  VAT  cooperation  and  feed  and  food
controls),  as  the  measure  essentially  provides  arrangements  for  cooperation  between  public
authorities of direct applicability.

3.1.2

Definitions, scope and competent authorities

26.
The  scope  of  the  regulation  is  limited  to  intra-Community  infringements  of  EU
legislation  that  protects  consumers’  interests.  The  scope  of  the  regulation  will  be  enlarged
when  the  proposed  framework  directive  prohibiting  unfair  commercial  practices  enters  into
force.

Competent authorities are at the heart of the proposed regulation. The regulation puts
27.
in place a series of mutual assistance tools. The use of these tools rests entirely in the hands of
the competent authorities, who are best placed to judge the operational enforcement needs of

6

consumer  protection.  The  regulation  grants  the  Commission  no  enforcement  rights  or
responsibilities.

28.
The designation of competent authorities is left to the Member States, in order to take
account  of  national  constitutional  arrangements  for  consumer  protection  enforcement.
Member  States  are  free  to  nominate  national  and/or  regional,  local  or  sectoral  competent
authorities. The proposal also provides for the designation by each Member State of a single
liaison office to ensure proper co-ordination between the competent authorities nominated in
each Member State.

29.
Competent  authorities  are  defined  as  public  authorities  with  specific  consumer
protection enforcement responsibilities. The proposal also ensures that only those authorities
with  a  minimum  of  common  investigation  and  enforcement  powers  can  be  designated  as
competent  authorities.  This  common  minimum  is  required  to  ensure  that  the  provisions  on
mutual assistance can function in practice and act as a credible deterrent to rogue traders. The
need  for  a  network  of  public  authorities  having  such  powers  has  also  been  recognised  in
Community instruments on data protection, competition and financial services.

30.
The  regulation  will  require  some  change  to  the  enforcement  rules  of  all  Member
States. Clearly however, some Member States will be more affected than others will. A large
majority of Member States and acceding  countries nevertheless  have public authorities with
specific consumer protection enforcement responsibilities.

However no such authorities exist in Germany, the Netherlands or in Luxembourg. In
31.
Austria, Länder authorities have executive authority to impose fines on traders for breaches of
certain laws.

The Member States, since the Injunctions Directive, have provided a privileged place
32.
for  consumer  organisations  in  enforcement  and  many  also  foresee  an  enforcement  role  for
competitors and business organisations. All these organisations have a valuable role to play.
The  present  proposal  does  not  change  or  diminish  the  role  played  by  these  organisations  at
national or EU level  in  any  way.  Their  role  should  continue  to  be  encouraged,  including  in
cross-border cases.

The  proposed  regulation  puts  in  place  a  network  of  competent  authorities  and  a
33.
framework for mutual assistance that complements those which exist already in each Member
State or which exist on a sectoral basis at Community level. The existing systems are not on
their own sufficient to ensure the smooth functioning of the internal market or the protection
of consumers. The proposed network is designed to provide an enforcement solution to deal
quickly  with  the  most  difficult  rogue  traders  committing  cross-border  infringements,
especially those who seek to exploit the freedoms of the internal market to harm consumers.

34.

There are several reasons why an EU network of public authorities is required.

(cid:1)  Only public authorities can have the investigation powers necessary to obtain evidence of

an infringement.

(cid:1)  Only  public  authorities  can  provide  sufficient  guarantee  of  the  confidentiality  and
professional secrecy concerning information exchanged. A guarantee of confidentiality and
secrecy is essential to ensure the trader’s reputation is not unfairly harmed and to prevent
investigations being compromised.

7

(cid:1)  The  public  authorities  in  the  large  majority  of  Member  States  where  they  exist  have
demonstrated the efficiency  and effectiveness of  a public dimension to enforcement.  The
threat of speedy action from public  authorities is  an important  deterrent to rogue traders,
especially those taking advantage of the opportunities of the internet. The credibility of this
deterrent at EU level would be harmed if there were gaps in the network. Some anecdotal
evidence has come to light in ICPEN discussions that some rogue traders may already be
exploiting these gaps to base themselves in Member States without public authorities.

(cid:1)  Public authorities are both impartial and accountable in the way that they operate to defend
the public interest. This is an important reassurance for traders. Private bodies are not so
accountable.  In  order  to  ensure  the  accountable  operation  of  the  regulation,  the  mutual
assistance  rights  provided  in  the  regulation  should  therefore  only  be  entrusted  to  public
authorities.  In  addition,  private  bodies  are  primarily  concerned,  given  their  organisation
along national lines, with consumers in their own country rather than other consumers in
the EU

(cid:1)  The effectiveness of the enforcement network established in the proposal depends upon the
reciprocal  rights  and  obligations  of  mutual  assistance.  Because  of  this  reciprocity,  each
Member  States  can  be  sure  that  their  consumers  will  be  effectively  protected  in  cross-
border situations. This reciprocity can only be guaranteed by equivalent public authorities
in each Member State.

(cid:1)  Given that a large majority of the Member States recognise the value of a public dimension
to their enforcement systems, the creation of a network of public authorities at EU level is
an  important  element  in  overcoming  reluctance  to  apply  the  principles  of  maximum
harmonisation to consumer protection laws. Reassuring the Member States that consumers
will be protected  by  equally  effective  public authorities when shopping cross-border  will
make inclusion of maximum harmonisation in a directive on  unfair commercial practices
and future consumer legislation more acceptable.

(cid:1)  The  prospect  of  enlargement  demands  action  to  safeguard  consumer  interests  in  an
enlarged internal market. Most of the new Member States do not have a long tradition of
consumer  protection  enforcement,  although  they  have  established  public  authorities.  The
proposed regulation is  therefore an opportunity  to ensure  that effective  enforcement is in
place throughout the new internal market.

35.
The  scope  of  the  proposed  regulation  is  limited  to  cross-border  infringements.
Therefore  the  Member  States  are  not  required  to  change  their  arrangements  for  domestic
infringements by this regulation.

36.
New public authorities are also not necessarily  required in those Member  States  that
currently lack them. The limited responsibilities of the regulation could be given to existing
public  authorities.  For  example,  in  several  Member  States  and  third  countries,  enforcement
responsibilities  for  consumer  protection  are  carried  out  by  the  agency  responsible  for  the
enforcement  of  competition  law  matters.  Positive  synergies  exist  between  the  consumer
protection and competition dimensions of market surveillance and enforcement.

3.2

Chapter II – Mutual Assistance

The  proposed  regulation  establishes  several  reciprocal  mutual  assistance  rights  and
37.
obligations  on  competent  authorities.  This  balance  reflects  the  fact  that  the  competent
authority  in  the  Member  State  of  the  consumer  is  best  placed  to  understand  and  judge  the

8

harm suffered by the consumer but the competent authority in the Member State of the trader
is  best  placed  to  act  within  their  own  jurisdiction  and  national  culture.  All  competent
authorities will have to play both roles.

38.
The basis of mutual assistance is free and confidential information exchange between
competent authorities. The proposal puts in place a system of exchange on request and, just as
importantly,  spontaneous  exchange.  Spontaneous  exchange  is  essential  to  effective  internal
market surveillance.

39.
If  the  information  exchanged  confirms  the  existence  of  an  intra-Community
infringement, the proposal requires that competent authorities act to bring about cessation of
the infringement without delay. The requested authority is free to determine the most effective
and efficient way to achieve this, being best placed to make  this  judgement.  Injunctions are
likely  to  be  the  main  enforcement  tool.  They  enable  action  to  be  taken  speedily  and
effectively  to  remove  practices  from  the  internal  market  that  infringe  EU  rules  before
consumers are harmed.

40.
The proposal also provides for co-ordination of surveillance and enforcement actions
between  competent  authorities.  It  is  increasingly  likely  that  cross-border  problems  will  not
simply be bilateral but will involve consumers in several Member States, especially where the
Internet is involved.

3.3

Chapter III: general conditions governing mutual assistance

41.
The  proposal  establishes  the  general  principle  that  competent  authorities  can  act
against traders within their jurisdiction regardless of the location of the consumers involved.
This chapter also sets out  general procedural rules for the conduct of mutual  assistance  and
standard rules on the use of information exchanged as a result of the Regulation.

42.
Article  13  sets  out  the  possibility  for  information  to  be  exchanged  with  competent
authorities  of  third  countries  under  bilateral  agreements.  Article  14  foresees  the  conditions
under  which  competent  authorities  may  refuse  assistance.  The  default  principle  of  the
Regulation  is  that  requests  for  assistance  should  be  accepted.  This  article  sets  out  the
conditions that can be used to justify a refusal to assist.

3.4

Chapter IV: Community activities

43.
The  principal  task  of  the  Regulation  is  to  provide  a  system  for  cooperation  between
competent  authorities  in  enforcement.  However,  the  Community  also  has  a  role  to  play  in
supporting  enforcement  and  in  co-ordinating  the  wider  Member  States’  information,
education and representation activities designed to promote consumer economic interests. The
Community’s  role  is  limited  here  to  supporting  measures  which  raise  the  standard  of
enforcement generally and which improve the ability of consumers to enforce their rights. The
Community  has  a  traditional  role  of  encouraging  the  exchange  of  best  practice  and  co-
ordinating national efforts so as to avoid duplication and the waste of scarce resources.

44.
There  is  in  addition  a  need  for  negotiation  at  Community  level  of  mutual  assistance
agreements  with  third  countries.  Similar  agreements  exist  in  the  area  of  competition  and
customs.  The  work  in  the  OECD  has  demonstrated  that  there  is  a  demand  for  mutual
assistance  on  an  international  scale.  Considerable  efficiency  gains  can  be  expected  if  such
international  agreements  can  be  negotiated  on  a  Community-wide  basis  rather  than
individually with each Member State. The arrangements for this are set out in Article 18.

9

45.
Article  15  provides  for  information  notified  to  the  Commission  to  be  stored  in  a
database  accessible  to  competent  authorities.  This  is  designed  to  improve  the  quality  of  the
surveillance  of  the  internal  market.  A  similar  database  already  exists  under  the  aegis  of  the
EU-group of the ICPEN and the Commission.

Article  16  provides  for  Community  co-ordination  of  administrative  activities  of
46.
competent  authorities  related  to  enforcement.  The  article  sets  out  possible  areas  for  co-
ordination,  leaving  the  Member  States  and  the  Commission  to  decide  over  time  the  precise
actions  needed  at  Community  level  to  co-ordinate  their  enforcement  work.  It  also  makes
explicit provision for exchanges of officials between competent authorities.

47.
Article  17 sets out further possible  areas  for Community  co-ordination  in  relation  to
national  actions  on  information,  advice  and  education,  consumer  representation,  the  extra-
judicial  settlement  of  disputes,  access  to  justice  and  statistics.  Once  again,  it  is  left  to  the
Member  States  and  the  Commission  to  decide  over  time  the  precise  actions  needed  at
Community level to coordinate their actions.

48.
These  coordinated  actions  may  or  may  not  require  Community  and/or  national
funding.  The  present  proposal  does  not  of  itself  provide  the  legal  basis  for  Community
expenditure  on  these  actions.  The  Commission’s  proposed  legal  framework  for  Community
action in support of consumer policy 2004-200720 and successor frameworks shall provide the
basis  for  such  expenditure.  The  present  proposal  instead  provides  a  decision-making
framework  for  co-ordinated  actions.  It  will  provide  the  possibility  for  the  practical
arrangements  concerning  the  operation  of  the  EEJ-net  and  the  European  Consumer
Information Centres (sometimes known as the Euroguichets) to be put on a more formal basis.

3.5

Chapter V: final provisions

49.
The  proposal  provides  for  an  Advisory  Committee  to  be  set  up  to  assist  the
Commission  in  implementing  the  practical  procedures  for  the  operation  of  the  regulation.
Articles 6, 7, 8, 9, 11, 14, 15, 16, 17, and 19 provide for detailed practical arrangements (such
as common forms) and other implementing measures to be delegated to the Committee, as is
common to other  mutual  assistance  arrangements. Given  the  operational enforcement  issues
covered by  the Regulation, representatives  of  competent  authorities,  amongst  others,  should
be members of this Committee. The role of the Advisory Committee shall not include issues
covered  by  the  Contact  Committee  established  under  the  Television  without  frontiers
Directive.

Articles  20  and  21  set  out  the  necessary  arrangements  for  the  monitoring  of  the
50.
effectiveness of enforcement in the EU. Member States are required to regularly report on the
application of the Regulation.

20

Proposal for a Decision of the European Parliament and of the Council establishing a legal framework
for Community actions in support of consumer policy 2004-2007 COM (2003) 44 final.

10

                                                
4.

FINAL REMARKS

51.
The proposed regulation is designed to operate on the basis of the existing consumer
protection acquis. However the effective operation of the arrangements would undoubtedly be
boosted with the adoption of a directive on unfair commercial practices and the development
of  maximum  harmonisation  in  all  the  consumer  protection  acquis.  A  more  harmonised  and
simpler regulatory system can make the work of enforcement officials easier as well as that of
traders and consumers.

52.
The  Commission  considers  that  adoption  of  the  proposed  regulation  by  Council  and
Parliament  should  be  undertaken  as  quickly  as  possible,  in  particular,  given  the  imminent
enlargement of the EU.

11

2003/0162 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on cooperation between national authorities responsible for the enforcement of
consumer protection laws ("the regulation on consumer protection cooperation")

(text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular
Article 95 thereof,

Having regard to the proposal from the Commission1,

Having regard to the opinion of the European Economic and Social Committee2,

Having regard to the opinion of the Committee of the Regions3,

Acting in accordance with the procedure laid down in Article 251 of the Treaty4,

Whereas:

(1) 

(2) 

The  Council  resolution  of  8  July  19965  acknowledged  that  a  continuing  effort  is
required  to  improve  cooperation  between  administrations  and  invited  the  Member
States  and  the  Commission  to  examine  as  a  matter  of  priority  the  possibility  of
reinforcing administrative cooperation in the enforcement of legislation.

Existing  national  enforcement  arrangements  for  the  laws  that  protect  consumers’
interests are not  adapted to the  challenges of  enforcement in the  internal  market  and
effective and efficient enforcement cooperation in these cases is not currently possible.
These  difficulties  give  rise  to  barriers  to  cooperation  between  public  authorities  to
detect,  investigate  and  bring  about  the  cessation  of  infringements  of  the  laws  that
protect  consumers’  interests  in  cross-border  cases.  The  resulting  lack  of  effective
enforcement in cross-border cases enables sellers and suppliers to evade enforcement
attempts  by  relocating  within  the  Community.  This  gives  rise  to  a  distortion  of
competition  for  law-abiding  sellers  and  suppliers  operating  either  domestically  or
cross-border.  The  difficulties  of  enforcement  in  cross-border  cases  also  undermines
the  confidence  of  consumers  in  taking  up  cross-border  offers  and  hence  their
confidence in the internal market.

1

2

3

4

5

OJ C , , p. .
OJ C , , p. .
OJ C , , p. .
OJ C , , p. .
OJ C 224, 01.08.1996, p 3

12

                                                
(3) 

(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

It  is  therefore  appropriate  to  facilitate  cooperation  between  public  authorities
responsible for enforcement of consumer protection in dealing with intra-Community
infringements;  to  contribute  to  improving  the  smooth  functioning  of  the  internal
market, the quality  and  consistency  of  enforcement of  consumer  protection laws and
the monitoring of the protection of consumers’ economic interests.

Since  the  objectives  of  the  proposed  action  cannot  be  sufficiently  achieved  by  the
Member  States  because  they  cannot  ensure  cooperation  and  co-ordination  by  acting
alone and can therefore be better achieved at Community level, the Community may
adopt measures, in accordance with the principle of subsidiarity as set out in Article 5
of  the  Treaty.  In  accordance  with  the  principle  of  proportionality,  as  set  out  in  that
Article, this regulation does not go beyond what is necessary in order to achieve those
objectives.

The scope of the provisions on mutual assistance in this regulation should be limited to
intra-Community infringements of Community directives on consumer protection. The
effectiveness with which infringements at national level are pursued should ensure that
there  is  no  discrimination  between  national  and  intra-Community  transactions.  This
regulation  does  not  affect  the  responsibilities  of  the  Commission  with  regard  to
infringements of Community law by the Member States.

The  protection  of  consumers  from  cross-border 
the
establishment  of  a  network  of  public  enforcement  authorities  throughout  the
Community  and  these  authorities  require  a  minimum  of  common  investigation  and
enforcement  powers  to  apply  this  regulation  effectively  and  to  deter  sellers  or
suppliers from committing intra-Community infringements.

infringements  requires 

The  ability  of  competent  authorities  to  cooperate  freely  on  a  reciprocal  basis  in
exchanging  information,  detecting  and  investigating  intra-Community  infringements
and  in  taking  action  to  bring  about  their  cessation  or  prohibition  is  essential  to
guaranteeing  the  smooth  functioning  of  the  internal  market  and  the  protection  of
consumers.

Competent  authorities  should  also  make  use  of  powers  granted  to  them  at  national
level  to  initiate  or  refer  matters  for  criminal  prosecution  to  also  bring  about  the
cessation or prohibition of intra-Community infringements without delay as a result of
a request for mutual assistance, where this is appropriate.

Information exchanged between competent authorities should be subject to the strictest
guarantees  of  confidentiality  and  secrecy  in  order  to  ensure  investigations  are  not
compromised or the reputation of sellers or suppliers unfairly harmed.

(10) 

In  the  event  of  a  refusal  to  provide  mutual  assistance  on  the  grounds  set  out  in  this
regulation,  the  Member  State  of  the  applicant  authority  may,  in  order  to  ensure  the
protection of consumers, take measures to restrict the freedom of the seller or supplier
responsible for the intra-Community infringement  to  supply  goods  or  services  to  the
Member  State  of  the  applicant  authority,  provided  that  such  measures  are  in
conformity with Community law.

(11)  The enforcement challenges that exist go beyond the frontiers of the European Union
and the interests of European consumers need to be protected from rogue traders based
in  third  countries.  Hence,  there  is  a  need  for  international  agreements  with  third

13

countries  regarding  mutual  assistance  in  the  enforcement  of  the  laws  that  protect
consumers’  interests  to  be  negotiated.  These  international  agreements  should  be
negotiated at Community level on the  basis  of this  Regulation in  order to ensure the
optimum  protection  of  European  consumers  and  the  smooth  functioning  of
enforcement cooperation with third countries.

(12) 

(13) 

It  is  appropriate  to  co-ordinate  at  Community  level  the  enforcement  activities  of  the
Member  States  in  respect of intra-Community  infringements  in  order  to  improve  the
application of this regulation and contribute to raising the standard and consistency of
enforcement .

It  is  appropriate  to  co-ordinate  at  Community  level  the  administrative  cooperation
activities  of  the  Member  States,  in  respect  of  their  intra-Community  dimension,  in
order to contribute to the better application of consumer protection laws and this role
has  already  been  demonstrated  in  the  establishment  of  the  European  extra-judicial
network.

(14)  Where the co-ordination of the activities of the Member States under this Regulation
entails Community financial support, the decision to grant such support shall be taken
in accordance with the procedures set out in the Decision of the European Parliament
and  of  the  Council  of  XX  establishing  a  legal  framework  for  Community  actions  in
support of consumer policy 2004-2007, in  particular  Actions  5  and  10  set  out  in  the
Annex to that Decision and successor Decisions.

(15)  The measures necessary for the implementation of this regulation should be adopted in
accordance  with  Council  Decision  1999/468/EC  of  28  June  1999  laying  down  the
procedures for the exercise of implementing powers conferred on the Commission6,

(16)  The effective monitoring of the application of this regulation and the effectiveness of

consumer protection requires regular reports from the Member States.

HAVE ADOPTED THIS REGULATION:

Chapter I
Objective, definitions, scope and competent authorities

Article 1
Objective

This  Regulation  lays  down  the  conditions  under  which  the  competent  authorities  in  the
Member States responsible for the enforcement of the laws that protect consumers’ interests
are to be designated and are to cooperate with each other and with the Commission in order to
ensure compliance with those laws and the smooth functioning of the internal market and in
order to enhance the protection of consumers’ economic interests.

6

OJ L 184, 17.7.1999, p. 22.

14

                                                
Article 2
Scope

The  provisions  on  mutual  assistance  in  this  regulation  shall  cover  intra-Community

1.
infringements.

This regulation shall be without prejudice to the rules on private international law, in

2.
particular rules related to court jurisdiction and applicable law.

3.
This  regulation  does  not  affect  the  application  in  the  Member  States  of  measures
relating to judicial cooperation in criminal and civil matters, in particular the operation of the
European judicial networks.

This regulation  shall  be  without  prejudice to Community  law  relating  to  the  internal

4.
market, in particular those provisions concerning the free movement of goods and services.

This  regulation  shall  be  without  prejudice  to  Community  law  relating  to  television

5.
broadcasting services.

For the purposes of this regulation:

Article 3
Definitions

a.

b.

c.

d.

e.

f.

g.

h.

‘laws that protect consumers’ interests’ means the Directives listed in Annex I
as transposed into the internal legal order of the Member States.

‘intra-Community infringement’ means any act contrary to the laws that protect
consumers’ interests that harms, or is likely to harm, the collective interests of
consumers  residing  in  a  Member  State  or  Member  States  other  than  the
Member State where the act originated.

‘competent authority’ means any public authority established either at national,
regional or local level with specific responsibilities to ensure compliance with
the laws that protect consumers’ interests.

‘single  liaison  office’  means  the  public  authority  in  each  Member  State
designated  as  responsible  for  co-ordinating  the  application  of  this  regulation
within that Member State.

‘competent  official’  means  the  official  who  can  directly  request  assistance  or
supply information .

‘applicant  authority’  means  the  competent  authority  that  makes  a  request  for
mutual assistance.

‘requested authority’ means the competent authority that receives a request for
mutual assistance.

‘seller  or  supplier’  means  any  natural  or  legal  person  who,  in  respect  of  the
laws  that  protect  consumers’  interests,  is  acting  for  purposes  relating  to  his
trade, business or profession;

15

i.

j.

k.

l.

‘surveillance activities’ means the actions of a competent authority designed to
detect  whether  intra-Community  infringements  have  taken  place  within  its
jurisdiction.

‘complaint’  means  a  statement  that  a  seller  or  supplier  has  committed,  or  is
likely to commit, an infringement of the laws that protect consumers’ interests.

‘mutual  assistance’  means  the  supply  of  information  or  the  taking  of
enforcement measures .

‘collective  interests  of  consumers’  means  the  general  interests  of  consumers
that do not include the cumulation of the interests of individuals who have been
harmed by an infringement.

Article 4
Competent authorities

Each Member State shall designate the competent authorities and single liaison office

1.
responsible for the application of this regulation.

Competent authorities shall have the investigation and enforcement powers necessary

2.
for the application of this regulation and shall exercise them in conformity with national law.

3.

These powers shall include, at least, the right:

(a)

to have access to any document in any form whatsoever;

(b)

to request information from any person, and if needed, to obtain judicial orders
requiring the supply of information by any person;

(c)

to carry out on-site inspections;

(d)

(e)

(f)

(g)

to  request  in  writing  that  the  seller  or  supplier  cease  the  intra-Community
infringement;

to  obtain  from  seller(s)  or  supplier(s)  responsible  for  intra-Community
infringements  a  binding  commitment 
intra-Community
to  cease 
infringement; and to publish the resulting commitment;

the 

to require the cessation or prohibition of any intra-Community infringement or
to  obtain  judicial  orders  requiring  the  cessation  or  prohibition  of  any  intra-
Community infringement; and to publish resulting decisions;

to  obtain  judicial  orders  against  the  losing  defendant  for  payments  into  the
public purse or to any beneficiary designated in or under national legislation, in
the event of failure to comply with a decision;

(h)

to obtain judicial orders requesting the freezing and/or sequestration of assets;

Competent authorities shall  have  adequate resources necessary  for  the  application  of
4.
this  regulation.  The  staff  of  such  authorities  shall  observe  professional  standards  and  be
subject  to  appropriate  internal  procedures  or  rules  of  conduct  that  ensure,  in  particular,  the

16

protection  of  personal  data,  procedural  fairness  and  the  proper  observance  of  the
confidentiality and professional secrecy provisions established in Article 12.

Each  competent  authority  shall  make  known  to  the  general  public  the  rights  and

5.
responsibilities it has been granted under this regulation.

Each competent authority shall designate competent officials who can directly request

6.
assistance or exchange information on the basis of the provisions set down in Article 11.

Article 5
Lists

1.
Each Member State shall communicate to  the  Commission  and  other  Member States
the identities  of  the  competent  authorities  and  single  liaison  office  designated  under  Article
4(1).

Each  single  liaison  office  shall  keep  an  up-to-date  list  of  competent  officials

2.
designated under Article 4 (6) and communicate it to the other single liaison offices.

The  Commission  shall  publish  and  update  the  list  of  single  liaison  offices  and

3.
competent authorities in the Official Journal of the European Union.

Chapter II
Mutual assistance

Article 6
Exchange of information on request

A  requested  authority  shall,  on  request  from  an  applicant  authority,  supply  any
1.
information required to establish whether an intra-Community infringement has occurred or is
likely to occur. The requested authority shall supply the information requested without delay.

The  requested  authority  shall  undertake  the  appropriate  investigations  or  any  other

2.
necessary measures, in order to gather the required information.

On request from the applicant authority, a competent official of the applicant authority

3.
may accompany the officials of the requested authority in the course of their investigations.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

4.
accordance with the procedure referred to in Article 19 (2).

Article 7
Spontaneous exchange of information

1.
When a competent authority becomes aware of an intra-Community infringement, or
considers  that  a  serious  risk  of  such  an  infringement  exists,  it  shall  notify  the  competent
authorities  of  other  relevant  Member  States  and  the  Commission,  supplying  all  necessary
information, without delay.

17

2.
When a competent authority takes further enforcement measures or receives requests
for  mutual  assistance  in  relation  to  the  intra-Community  infringement,  it  shall  notify  the
competent authorities of other Member States and the Commission.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

3.
accordance with the procedure referred to in Article 19 (2).

Article 8
 Requests for enforcement measures

1.
A requested authority shall, on request from an applicant authority, take all necessary
measures  to  bring  about  the  cessation  or  prohibition  of  the  intra-Community  infringement
without delay. These measures shall include, where appropriate, an appeal to a higher court,
in the event that any action before a court is not successful.

In  order  to  fulfil  its  obligations  under  paragraph  1,  the  requested  authority  shall
2.
exercise  the  powers  set  out  under  Article  4  (3)  and  any  additional  powers  granted  to  the
requested authority under national law. The requested authority shall determine the measures
to be taken to bring about the cessation or prohibition of the intra-Community infringement in
the most efficient and effective way.

3.
The requested authority shall consult the applicant authority in the course of taking the
enforcement  measures.  The  requested  authority  shall  notify  the  applicant  authority,  the
competent  authorities  of  other  Member  States  and  the  Commission  of  its  measures  without
delay.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

4.
accordance with the procedure referred to in Article 19 (2).

Article 9
Co-ordination of surveillance and enforcement

Competent authorities shall  co-ordinate  their surveillance  and enforcement activities.

1.
They shall exchange all information necessary to achieve this.

2.
When  competent  authorities  become  aware  that  an  intra-Community  infringement
harms consumers in more than two Member States, the competent authorities concerned shall
coordinate  their  enforcement  actions  and  requests  for  mutual  assistance.  In  particular  they
shall seek to conduct simultaneous investigations and enforcement measures.

The  competent  authorities  shall  inform  the  Commission  in  advance  of  this  co-

3.
ordination and may invite the Commission to participate.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

4.
accordance with the procedure referred to in Article 19 (2).

18

Chapter III
General conditions governing mutual assistance

Article 10
General Responsibilities

Competent  authorities  shall  fulfil  their  obligations  under  this  regulation  as  though
1.
acting on behalf of consumers in their own country and on their own account or at the request
of another competent authority in their own country.

Member States shall take all necessary measures to ensure effective  co-ordination of
2.
the application of this regulation by the competent authorities designated by them, through the
single liaison office.

Article 11
Request and information exchange procedures

The  applicant  authority  shall  ensure  that  all  requests  for  mutual  assistance  contain

1.
sufficient information to enable a requested authority to fulfil the request.

Requests  shall  be  sent  either  to  single  liaison  offices,  to  competent  authorities  or

2.
competent officials.

3.
Requests for assistance and the communication of information (including notifications
to  the  Commission)  shall  be  made  in  writing,  using  a  standard  form  and  communicated
electronically.  Requests  for  assistance  or  the  communication  of  information  between
competent officials may be made in another way, if both agree.

The languages used for requests and the communication of information shall be agreed
4.
by  the  competent  authorities  or  competent  officials  in  question  before  requests  have  been
made.

5.
Information communicated as a result of a request shall be communicated directly to
the applicant authority or competent officials who made the request. Competent authorities or
competent officials shall ensure that single liaison offices are informed of all requests sent or
received and information communicated following a request.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

6.
accordance with the procedure referred to in Article 19 (2).

Article 12
Use of information exchanged

Information supplied may only be used for the purposes of ensuring compliance with

1.
the laws that protect consumers’ interests.

2.
Competent authorities may invoke as evidence any information, documents, findings,
statements, certified true copies or intelligence communicated pursuant  to  this regulation on
the same basis as similar documents obtained in their own country.

19

3.
Information communicated in  any  form  pursuant  to  the  mutual  assistance  provisions
of  this  regulation,  including  when  notified  to  the  Commission  and  stored  on  the  database
referred to in Article 15, shall be confidential and be covered by the obligation of professional
secrecy, unless:

a.

b.

c.

the authority communicating the information consents to its disclosure;

it is invoked as evidence;

it is disclosed as part of the publication of the commitment or decision referred
to in Article 4(3) (e) or (f)

Member States  shall for the  purpose of  applying  this  regulation adopt the legislative
4.
measures  necessary  to  safeguard  the  interests  referred  to  in  Article  13(1)(d)  and  (f)  of
Directive 95/46/EC7.

Article 13
Information exchange with third countries

When a competent authority receives information from an authority of a third country,
1.
it shall supply the information to the relevant competent authorities of other Member States,
in so far as it is permitted by bilateral assistance agreements with the third country.

Information communicated under this Regulation may also be supplied to an authority
2.
of  a  third  country  by  a  competent  authority  under  an  assistance  agreement  with  the  third
country,  provided  the  consent  of  the  competent  authority  that  originally  supplied  the
information has been obtained.

Article 14
Conditions

1.
Member States shall waive  all claims  for the  reimbursement  of  expenses incurred in
applying this regulation. However, the Member State of the applicant authority shall remain
liable to the Member State of the requested authority for any costs and any losses incurred as
a  result  of  measures  held  to  be  unfounded  by  a  court  as  far  as  the  substance  of  the  intra-
Community infringement is concerned.

2.

A requested authority may refuse to comply with a request for mutual assistance if:

a.

b.

the  request  would  impose  a  disproportionate  administrative  burden  on  the
intra-Community
in  relation 
requested  authority 
infringement, in terms of the potential consumer detriment.

the  scale  of 

the 

to 

judicial proceedings have already been initiated or final judgement has already
been passed in respect of the same intra-Community infringements and against
the same sellers or suppliers before the judicial authorities in the Member State
of the requested authority.

7

OJ L 281, 23.11.1995, p 31

20

                                                
c.

the request is not well founded.

The  requested  authority  shall  inform  the  applicant  authority  and  the  Commission  of

3.
the grounds for refusing a request for assistance.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

4.
accordance with the procedure referred to in Article 19 (2).

Chapter IV
Community activities

Article 15
Complaints and Database

The  Member  States  shall  regularly  notify  to  the  Commission  statistics  on  consumer

1.
complaints received by competent authorities.

The  Commission  shall  maintain  an  electronic  database  in  which  it  shall  store  and
2.
process the information it receives under Articles 7, 8, 9 and this Article. The database shall
be made available for consultation by the competent authorities.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

3.
accordance with the procedure referred to in Article 19 (2).

Article 16
Enforcement coordination

1.

Member States shall, with the Commission, co-ordinate the following activities:

a.

b.
c.
d.

e.
f.

g.

the training of their officials, including language training and the organisation
of training seminars;
the collection and classification of consumer complaints;
the development of sector-specific networks of competent officials;
their strategy,  planning  and  risk  analysis  activities  related  to  surveillance  and
enforcement;
the development of information and communication tools;
the  development  of  standards,  methodologies  and  guidelines  for  enforcement
officials.
the exchange of their officials.

Where  appropriate,  the  competent  authorities  shall  exchange  competent  officials  in
2.
order to improve cooperation. The competent authorities shall take the necessary measures to
enable exchanged competent officials to play an effective part in activities of the competent
authority.  To  this  end  such  competent  officials  shall  be  authorised  to  carry  out  the  duties
entrusted to them by the host competent authority in accordance with the laws of that Member
State.

During the exchange the civil liability of the competent official shall be treated in the
3.
same  way  as  that  of  the  officials  of  the  host  competent  authority.  Exchanged  competent
officials shall observe professional standards and be subject to the appropriate internal rules

21

of conduct of the host competent authority that ensure, in particular, the protection of personal
data,  procedural  fairness  and  the  proper  observance  of  the  confidentiality  and  professional
secrecy provisions established in Article 12.

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

4.
accordance with the procedure referred to in Article 19 (2).

Article 17
Administrative cooperation

1.

Member States shall, with the Commission, co-ordinate their activities designed to:

a.
b.
c.

d.
e.

inform, advise and educate consumers;
support the activities of consumer representatives;
support the activities of bodies responsible for the extra-judicial settlement of
consumer disputes;
support consumers’ access to justice;
gather statistics, research or other information relating to consumer behaviour,
attitudes and outcomes;

The  measures  necessary  for  the  implementation  of  this  Article  shall  be  adopted  in

2.
accordance with the procedure referred to in Article 19 (2).

Article 18
International agreements

The  Community  shall  cooperate  with  third  countries  and  with  the  competent  international
organisations  in  order  to  enhance  the  protection  of  consumers’  economic  interests.  The
arrangements for cooperation, including the establishment of mutual assistance arrangements,
may be the subject of agreements between the Community and the third parties concerned.

Chapter V
Final provisions

Article 19
Standing Committee

1.
The Commission shall be assisted by a Standing Committee on Consumer Protection
Cooperation,  hereinafter  referred  to  as  ‘the  Committee’,  composed  of  representatives  of  the
Member  States  and  chaired  by  the  representative  of  the  Commission.  However,  matters
regulated  by  the  provisions  of  Directive  89/552/EEC,  as  amended,  shall  continue  to  be
examined only by the Contact Committee set up by that Directive.

Where reference is made to this paragraph, Article 3 and 7 of Decision 1999/468/EC

2.
shall apply having regard to the provisions of Article 8 thereof.

3.

The Committee shall adopt its Rules of Procedure.

22

Article 20
Committee tasks

1.
The Committee may examine all matters relating to the application of this Regulation
raised by its chairman, either on his own initiative or at the request of the representative of a
Member State.

In  particular,  it  shall  examine  and  evaluate  how  the  arrangements  for  cooperation

2.
provided for in this regulation are working.

Where  appropriate,  the  Committee  may  also  invite  qualified  entities  notified  under

3.
Article 3 of the Injunctions Directive to participate in its meetings.

Article 21
National Reports

1.
Member  States  shall  communicate  to  the  Commission  the  text  of  any  provisions  of
national  law  that  they  adopt  or  of  agreements, other  than  to  deal  with  individual  cases,  that
they conclude on matters covered by this Regulation.

Every  two  years  from  the  date  of  entry  into  force  of  this  Regulation,  the  Member

2.
States shall report to the Commission on the application of this Regulation.

3.

National reports shall address:

a.

b.

c.

d.

e.

f.

resources  or

the  organisation,  powers, 

information  on  enforcement 

any  new 
information  about 
responsibilities of the competent authorities.
any  information  concerning  trends,  means  or  methods  of  committing  intra-
Community infringements, particularly those that has revealed shortcomings or
lacunae in this regulation or in the laws that protect consumers’ interests.
that  have  proved 
any 
effectiveness.
statistics relating to the activities of competent authorities such as actions under
this regulation, complaints received, enforcement actions and judgements.
summaries  of  significant  national  interpretative  judgements  in  the  laws  that
protect consumers’ interests.
any other information relevant to the application of this regulation.

techniques 

their

Article 22
Other mutual assistance obligations

The  provisions  of  this  Regulation  shall  be  without  prejudice  to  the  fulfilment  of  any  wider
obligations in relation to mutual assistance, including in criminal matters, ensuing from other
legal acts, including bilateral or multilateral agreements.

23

Article 23
Entry into force

This Regulation shall enter into force on the 20thday  following that of its publication in the
Official Journal of the European Union.

It shall apply from [ ] [ ] 20[ ].

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the European Parliament
The President

For the Council
The President

24

LIST OF DIRECTIVES COVERED BY ARTICLE 2 (*)

ANNEX I

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

Council Directive 84/450/EEC of 10 September 1984 relating to the  approximation
of  the  laws,  regulations  and  administrative  provisions  of  the  Member  States
concerning  misleading  advertising  (OJ  L  250,  19.9.1984,  p.  17)  and  Directive
97/55/EC  of  the  European  Parliament  and  of  the  Council  of  6  October  1997
amending Directive 84/450/EEC concerning misleading advertising so as to include
comparative advertising (OJ L290, 22/10/1997 P.18-22).

Council  Directive  85/577/EEC  of  20  December  1985  to  protect  the  consumer  in
respect of contracts negotiated away from business premises (OJ L 372, 31.12.1985,
p. 31).

Council  Directive  87/102/EEC  of  22  December  1986  for  the  approximation  of  the
laws,  regulations  and  administrative  provisions  of  the  Member  States  concerning
consumer credit (OJ L 42, 12.2.1987, p. 48), as last amended by Directive 98/7/EC
(OJ L 101, 1.4.1998, p. 17) [and Directive XX/XX/EC of X].

Council  Directive  89/552/EEC  of  3  October  1989  on  the  coordination  of  certain
provisions  laid  down  by  law,  regulation  or  administrative  action  in  Member  States
concerning the pursuit of television broadcasting  activities: Articles 10 to 21 (OJ L
298,  17.10.1989,  p.  22  as amended by  Directive  97/36/EC  (OJ  L  202,30.7.1997,  p.
60)).

Council Directive 90/314/EEC of 13 June 1990 on package travel, package holidays
and package tours (OJ L 158, 23. 6.1990, p. 59).

Directive  2001/83/EC  of  the  European  Parliament  and  of  the  Council  of  23
September  2001  on  the  Community  code  relating  to  medicinal  products  for  human
use: Articles 86 to 100 (OJ L 311, 28.11.2001, p. 67)"

Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts
(OJ L 95, 21.4.1993,p. 29).

Directive  94/47/EC  of  the  European  Parliament  and  of  the  Council  of  26  October
1994 on the protection of purchasers in respect of certain aspects of contracts relating
to the purchase of the right to use immovable properties on a timeshare basis (OJ L
280, 29.10.1994, p. 83).

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 (OJ L 144, 4.6.1997, p.
19).

Directive 1999/44/EC of the European Parliament and of the Council of 25 may 1999
on  certain  aspects  of  the  sale  of  consumer  goods  and  associated  guarantees  (OJ  L
171, 7.7.1999, p12).

Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000
on  certain  legal  aspects  of  information  society  services,  in  particular  electronic

25

12.

13.

14.

15.

16.

17.

commerce,  in  the  Internal  Market  ('Directive  on  electronic  commerce')  (OJ  L  178,
17.07.2000 p. 1)

Directive 2002/65/EC of the European Parliament and of the Council concerning the
distance marketing of consumer financial services. (OJ L L271, 9/10/2002, p.16-24)

European Parliament and Council Regulation XXXX/XX/EC on sales promotions.

European  Parliament  and  Council  Directive  XXXX/XX/EC  concerning  unfair
business-to-consumer  commercial  practices  in  the  internal  market  (the  unfair
commercial practices directive).

European Parliament and Council Regulation XXXX/XX/EC on nutrition and health
claims made on foods.

Council Regulation (EEC) No 295/91 of 4 February 1991 establishing common rules
for  a  denied-boarding  compensation  system  in  scheduled  air  transport,  OJ  L  36  of
8.2.1991

Council Regulation XXXX/XX/EC establishing common rules for compensation and
assistance  to  air  passengers  in  the  event  of  denied  boarding  and  of  cancellation  or
long delay of flights

(*) Directive Nos. 1, 6, 7 and 9 contain specific provisions on injunctive actions.

26

LEGISLATIVE FINANCIAL STATEMENT

Policy area: HEALTH AND CONSUMER PROTECTION
Activity: Consumer policy

TITLE OF ACTION: REGULATION ON CONSUMER PROTECTION COOPERATION

1.

BUDGET LINE(S) + HEADING(S)

170201 (B5-100) Community activities in favour of consumers

2.

2.1.

2.2.

OVERALL FIGURES

Total allocation for action (Part B): 150,000 per year for commitment

Period of application:

From 2004, unlimited

2.3.

Overall multiannual estimate of expenditure:

(a)

Schedule  of  commitment  appropriations/payment  appropriations 
intervention) (see point 6.1.1)

(financial

€ million (to three decimal places)

2004

2005

2006

2007

2008

Commitments

0.150

0.150 0.100

0.050

0.050

2009+
subs
yrs
0.050

Total

0.550

Payments

0.045

0.090 0.135

0.105

0.070

0.050

0.495

(b)

Technical and administrative assistance and support expenditure(see point 6.1.2)

Commitments

Payments

Subtotal a+b

Commitments

0.150

0.150

0.100

0.050

0.050

0.050

0.550

Payments

0.045

0.090

0.135

0.105

0.070

0.050

0.495

(c)

Overall  financial  impact  of  human  resources  and  other  administrative  expenditure
(see points 7.2 and 7.3)

Commitments/
payments

0.229

0.229

0.229

0.229

0.229

0.229

1.374

27

TOTAL a+b+c

Commitments

0.379

0.379

0.329

0.279

0.279

0.279

1.924

Payments

0.274

0.319

0.364

0.334

0.299

0.279

1.869

2.4.

Compatibility with financial programming and financial perspective

Proposal is compatible with existing financial programming.

2.5.

Financial impact on revenue:1

Proposal has no financial implications (involves  technical  aspects  regarding  implementation
of a measure)

3.

BUDGET CHARACTERISTICS

Type of expenditure

New

EFTA
contribution

Non-comp

Diff

NO

YES

Contributions
from applicant
countries
YES, subject to
negotiations on
participation

Heading in
financial
perspective
No 3

4.

LEGAL BASIS

Article 95 and 153(3)b TEC and the proposal for a decision of the European Parliament
and of the Council establishing a general  framework  for financing Community actions
in support of consumer policy for the years 2004-2007.

5.

5.1.

DESCRIPTION AND GROUNDS

Need for Community intervention 2

The need for Community budgetary intervention in this area has already been set out in the
proposal for a decision of the European Parliament and of the Council establishing a general
framework  for  financing  Community  actions  in  support  of  consumer  policy  for  the  years
2004-2007.  In  particular  that  proposal  established  the  effective  enforcement  of  consumer
protection  rules  as  a  central  policy  objective.  Action  5  of  the  proposed  general  framework
refers  specifically  to  the  actions  necessary  for  the  co-ordination  of  surveillance  and
enforcement actions referred to in this regulation to be financed 100% from the Community
budget.  In  addition  joint  action  10  provides  for  the  possibility  of  co-financing  the  same
actions with one or more Member States.

The  Community  contribution  envisaged  in  this  regulation  concerns  measures  to  support,
supplement  and  monitor  the  consumer  protection  policy  pursued  by  the  Member  States.  In
particular the proposed actions with budgetary consequences are designed to:

1

2

For further information, see separate explanatory note.
For further information, see separate explanatory note.

28

                                                
–  ensure  the  maintenance  of  two  databases  (of  intra-Community  infringements  and

complaints received by competent authorities) under Article 7 and Article 12.

–  support the co-ordination of national enforcement activities (Article 17)

–  support the co-ordination of national administrative actions designed to improve consumer

education, information and representation (Article 18).

The only direct budgetary consequences of the present regulation arise from the commitments
to maintain the databases established under Articles 7 and 12. The provisions on cooperation
in  Article  17  and  18  do  not  themselves  give  rise  to  annual  budgetary  consequences,  only
providing  a  decision-making  framework  for  non-budgetary  issues.  Any  budgetary  decisions
arising from of the activities foreseen in Articles 17 and 18 will be taken under the procedures
foreseen  in  the  general  framework  for  2004-2007.  Only  the  budgetary  consequences  of  the
databases  established  under  Articles  7  and  12  are  therefore  addressed  in  this  legislative
financial statement.

5.1.1. Objectives pursued

The proposed databases are designed to contribute to meeting the Treaty objective that refers
to the monitoring of national policies. They aim more specifically:

–  to  provide  easily  accessible  information  to  competent  authorities  relating  to  intra-

Community infringements reported by other competent authorities;

–  to  provide  Member  States  and  the  Commission  with  information  about  trends  in
complaints  about  sellers  or  suppliers.  This  information  is  an  important  contribution  to
policymakers responsible for consumer protection regulation and enforcement.

5.1.2. Measures taken in connection with ex ante evaluation

The measures taken are set out in the legislative financial statement attached to the proposal
for  a  decision  of  the  European  Parliament  and  of  the  Council  establishing  a  general
framework  for  financing  Community  actions  in  support  of  consumer  policy  for  the  years
2004-2007.

5.2.

Action envisaged and budget intervention arrangements

The  two  actions  will  put  in  place  and  maintain  two  databases,  one  of  intra-Community
infringements (Article  7), one of  complaints  received  by  competent  authorities  (Article  12).
The databases will be made available to the competent authorities. The ultimate beneficiaries
will be consumers in the EU.

The following budget intervention arrangements are foreseen:

(cid:1)  Actions  taken  by  the  Commission  through  contracts  following  procurement  procedures,
such  as  calls  for  tenders.  Appropriate  technical  specifications  will  be  defined  for  each
action.

These  arrangements  for  budget  intervention  will  be  applied  in  accordance  with  the  relevant
provisions  of  the  Financial  Regulation  applicable  to  the  general  budget  of  the  European
Communities.

29

5.3.

Methods of implementation

The  actions  under  the  framework  will  be  implemented  and  managed  directly  by  the
Commission using either permanent or temporary staff.

6.

FINANCIAL IMPACT

6.1.

Total financial impact on Part B - (over the entire programming period)

(The method of calculating the total amounts set out in the table below must be explained by
the breakdown in Table 6.2. )

6.1.1.

Financial intervention

NB. These credits have already been foreseen in the proposal for a decision of the European
Parliament  and  of  the  Council  establishing  a  general  framework  for  financing  Community
actions in support of consumer policy for the years 2004-2007.

Commitments (in € million to three decimal places)

Breakdown

2004

2005

2006

2007

2008

Databases

0.150

0.150

0.100

TOTAL 0.150

0.150

0.100

0.50

0.50

0.50

0.50

Total

2009+
subs yrs
0.50

0.50

6.1.2.

Technical  and  administrative  assistance,  support  expenditure  and  IT  expenditure
(commitment appropriations)

n/a

6.2.

n/a

7.

Calculation  of  costs  by  measure  envisaged  in  Part  B  (over  the  entire
programming period)3

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE

7.1.

Impact on human resources

Staff to be assigned to management of the
action using existing resources

Description of tasks deriving from the
action

Types of post

Number of
permanent posts

Number of
temporary posts

Officials 
temporary staff

or

A

B

C

1 (50%)

1 (50%)

1 (50%)

Other human resources

Total

1.5

Total

162,00
0

162,00
0

3

For further information, see separate explanatory note.

30

If necessary, a fuller description of the
tasks may be annexed.

                                                
7.2.

Overall financial impact of human resources

Type of human resources

Amount (€)

Method of calculation *

Officials

Temporary staff

Other human resources

162,000

1.5*108,000

(specify budget line)

Total

162,000

The amounts are total expenditure for twelve months.

7.3.

Other administrative expenditure deriving from the action

Amount €

Method of calculation

2,292

-

65,000

1*8*286.45

-

4*25*650

Budget line

(number and heading)

Overall allocation (Title A7)

A0701 – Missions

A07030 – Meetings
A07031 – Compulsory committees 1
A07032 – Non-compulsory committees 1

A07040 – Conferences

A0705 – Studies and consultations

Other expenditure (specify)

Information systems (A-5001/A-4300)

Other expenditure - Part A (specify)

Total

67292

The amounts are total expenditure for twelve months.

1 Specify the type of committee and the group to which it belongs.

I.

II.

III.

Annual total (7.2 + 7.3)

Duration of action

€ 229,292

indeterminate

Total cost of action (I x II)

n/a

31

8.

FOLLOW-UP AND EVALUATION

8.1.

Follow-up arrangements

The arrangements to be taken are set out in the legislative financial statement attached to the
proposal for a decision of the European Parliament and of the Council establishing a general
framework  for  financing  Community  actions  in  support  of  consumer  policy  for  the  years
2004-2007.

8.2.

Arrangements and schedule for the planned evaluation

See 8.1.

9.

ANTI-FRAUD MEASURES

See 8.1.

32