COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the document Proposals for DIRECTIVES OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL (1) amending Council Directive 93/13/EEC, Directive 98/6/EC of the European Parliament and of the Council, Directive 2005/29/EC of the European Parliament and of the Council and Directive 2011/83/EU of the European Parliament and of the Council as regards better enforcement and modernisation of EU consumer protection rules and (2) on representative actions for the protection of the collective interests of consumers, and repealing Directive 2009/22/EC
Date: 2018-04-11
Institutions: Directorate-General for Justice and Consumers, European Commission
Subjects: advertising malpractice, collective interest, consumer policy, consumer protection, electronic commerce, indemnification, infringement of EU law, injunction, penalty, single market

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   EUROPEAN COMMISSION  Brussels, 11.4.2018  SWD(2018) 98 final  COMMISSION STAFF WORKING DOCUMENT  EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT  Accompanying the document Proposals for   DIRECTIVES OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL (1) amending Council Directive 93/13/EEC, Directive 98/6/EC of the European Parliament and of the Council, Directive 2005/29/EC of the European Parliament and of the Council and Directive 2011/83/EU of the European Parliament and of the Council as regards better enforcement and modernisation of EU consumer protection rules   and   (2) on representative actions  for the protection of the collective interests of consumers, and repealing Directive 2009/22/EC {COM(2018) 184 final} - {SWD(2018) 96 final}  
 
 
Executive Summary Sheet 

Impact assessment on Proposal for a Directive introducing targeted amendments to EU consumer 
law Directives and Proposal for a Directive amending and replacing Directive 2009/22/EC on 
injunctions for the protection of consumer interests (New Deal for Consumers). 

A. Need for action 

Why? What is the problem being addressed? Maximum 11 lines 

This Impact Assessment follows a Fitness Check of EU consumer law, an evaluation of Directive 2011/83/EU on 
Consumer Rights, both published in May 2017, and an evaluation of the Recommendation on Collective Redress, 
published  in  January  2018.  Results  show  that,  while  the  substantive  rules  are  overall  fit  for  purpose,  their 
effectiveness  is  hindered  by  lack  of  awareness  and  by  insufficient  enforcement  and  consumer  redress 
opportunities.  In  2016,  20.1 %  of  EU  consumers  reported  consumer  rights-related  problems  and  24 %  of 
traders  thought  compliance  with  consumer  law  was  not  good  enough.  This  leads  to  consumer  detriment  and 
disruption of fair competition for traders. Furthermore, these evaluations showed the need for modernising the 
rules and removing disproportionate burdens in specific areas. Therefore, this Impact Assessment first addresses 
current ineffective mechanisms to (1) stop and deter infringements and (2) ensure that consumers get redress 
for harm suffered, especially in mass harm situations. It then looks at modernising some EU consumer rules in 
view  of  digital  developments  and  removing  disproportionate  burdens  on  traders  in  specific  areas.  These 
problems are expected to become greater over time as consumer transactions intensify due to globalisation and 
digitalisation.   

What is this initiative expected to achieve? Maximum 8 lines 

The initiative aims at further consolidating a healthy consumer environment, which supports economic growth as 
consumer  expenditure  accounts  for  56 %  of  EU  GDP.  The  envisaged  measures  should,  on  the  demand  side, 
reduce consumer detriment, support trust and empower consumers to play their part in driving the markets. On 
the supply side, they aim to ensure fair competition and legal certainty for companies. The specific objectives 
are  to:  (1)  improve  compliance  with  EU  consumer  law  and  (2)  modernise  consumer  protection  rules  and 
eliminate  unnecessary  costs  for  traders.  This  will  contribute  to  the  general  objectives  of:  (1)  ensuring  a  high 
level  of  consumer  protection  and  (2)  smooth  functioning  of  the  internal  market,  for  the  benefit  of  both 
consumers and traders. 

What is the value added of action at the EU level? Maximum 7 lines  

Consumer protection belongs to the shared competences of Member States and the EU. The problems identified 
in  this  Impact  Assessment  are  widespread  and  have  the  same  causes  across  the  EU.  In  cases  of  widespread 
illegal practices affecting consumers in several Member States, enforcement must be based on a common and 
uniform substantive law framework. The Fitness Check Report found that the most important added value of EU 
consumer  law  is  that  the  harmonised  rules  enable  national  enforcement  authorities  to  address  cross-border 
infringements harming consumers in several Member States more effectively. At the same time, the harmonised 
rules allow traders to trade cross-border more easily and at lower cost. 

B. Solutions 

What  legislative  and  non-legislative  policy  options  have  been  considered?  Is  there  a  preferred 
choice or not? Why? Maximum 14 lines  
Concerning lack of compliance, a number of EU-level actions have been or are being taken to address the issues 
identified  by  the  previous  evaluations.  This  initiative  focuses  on  problem  drivers  that  have  not  yet  been 
addressed otherwise. Non-legislative options are considered, but, as suggested in the evaluations, the proposed 
options are targeted legislative interventions. They would complement the legislative and non-legislative  steps 
that have already been taken. As concerns modernising EU consumer rules, non-legislative approaches are also 
assessed, but in each case found not to be likely to fully address the problem drivers. The preferred package of 
options include interventions to ensure:  

  More dissuasive and proportionate penalties for breaches of EU consumer rules, 
  Remedies for victims of unfair commercial practices, 

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Increased transparency for B2C transactions on online marketplaces, 
Improved consumer protection for “free” digital services, i.e. provided without monetary payment, 

  Strengthened mechanisms for collective injunctions and redress,  
 
 
  Modernisation of information requirements, 
  Correction of imbalances in the right of withdrawal from distance and off-premises sale contracts.   

Who supports which option? Maximum 7 lines  
Consumer associations support all the proposed measures, except on information requirements and the right 
of  withdrawal.  Business  associations  support  the  suggested  interventions  on  transparency  for  online 
marketplaces,  “free”  digital  services  (partly),  information  requirements  and  the  right  of  withdrawal.  There  is 
some resistance from business associations to the proposed interventions on penalties, remedies, collective 
injunctions  and  redress  and  “free”  digital  services.  Many  Member  State  authorities  support  the  proposed 
interventions  on  remedies,  collective  injunctions  and  redress,  transparency  for  online  marketplaces  and  “free” 
digital services. Some express concerns about interventions on penalties, remedies and the right of withdrawal. 

C. Impacts of the preferred option 

What are the benefits of the preferred option (if any, otherwise main ones)? Maximum 12 lines                                       
The  preferred  package  of  options  will  make  consumer  redress  easier  and  more  effective,  and  thus  reduce 
consumer  detriment  which  will  be  beneficial  particularly  for  vulnerable  consumers.  It  will  also  improve 
compliance  through  increased  deterrence.  The  intervention  will  be  complementary  to  the  revised  CPC 
Regulation  and  support  its  effective  functioning.  By  introducing  improved  redress  opportunities  and  by  filling 
gaps  in  current  protection  for  digital  transactions,  consumer  trust  will  be  enhanced.  Law-abiding  traders  will 
benefit  from  fairer  competition.  Compliant  traders,  including  SMEs,  will  have  reduced  costs  because  of  more 
balanced rules on the right of withdrawal, simplification of information requirements, improved efficiency in their 
online  communication  with  consumers  and  harmonisation  of  rules,  particularly  for  online  transactions.  Positive 
impacts  can  also  be  expected  for  the  environment  through  ensuring  greater  deterrence  of  misleading 
environmental claims.  

What are the costs of the preferred option (if any, otherwise main ones)? Maximum 12 lines                                       

There will be no significant costs for compliant traders associated with interventions on penalties, remedies and 
collective injunctions and redress.  Non-compliant traders will face additional costs from these interventions, in 
particular because of stronger penalties and because consumers will have better mechanisms to claim remedies, 
possibly  also in  collective proceedings,  which  will  “skim  off”  illegally  obtained profits. With the  intervention  on 
“free”  digital  services,  providers  of  such  services  will  have  additional  compliance  costs.  The  intervention  on 
transparency for online marketplaces also implies costs to adapt online interfaces to collect certain information 
from  third  party  traders  and  pass  it  on  to  consumers.  However,  these  two  interventions  will  also  generate 
savings due to more harmonised rules between the Member States and greater legal clarity. The interventions 
on  information  requirements  and  the  right  of  withdrawal  will  bring  savings  for  traders.  No  negative 
environmental or social impacts are expected. 

How will businesses, SMEs and micro-enterprises be affected? Maximum 8 lines 

In  line  with  the  existing  EU  consumer  law  acquis,  no  exemptions  are  provided  for  SMEs,  including  micro-
enterprises. This would have been contrary to the general purpose of consumer protection rules and ultimately 
also contrary to the interests of SMEs, as consumers would have had a lower level of protection and thus less 
trust when buying from them. Whilst costs for businesses overall will be insignificant, the preferred package of 
options  will  reduce  costs  for  businesses,  including  SMEs,  in  relation  to  the  right  of  withdrawal  and  they  will 
benefit from increased transparency when selling to consumers via online marketplaces. Stronger enforcement 
and redress mechanisms will reduce negative effects from unfair competition.   

Will there be significant impacts on national budgets and administrations? Maximum 4 lines 
Interventions on penalties, remedies and collective injunctions and redress will generate costs for those Member 
States  that  will  need  to  reform  national  rules,  for  example,  on  penalties  or  consumer  redress  mechanisms. 
However,  Increased  compliance  will  generate  savings  due  to  reduced  costs  of  administrative  and  judicial 
procedures. Collective redress mechanisms will rationalise judicial proceedings in mass harm situations.  

Will there be other significant impacts? Maximum 6 lines  
As  the  focus  of  the  preferred  package  is  improved  compliance  with  EU  consumer  law,  consumer  rights  will 

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become  more  tangible  for  the  individual  consumers  and  thus  enhance  citizens'  and  businesses'  acceptance  of 
the  added  value  of  EU  rules.  The  intervention  on  collective  injunctions  and  redress  can  contribute  to  better 
access to  justice.  Interventions  on  penalties,  remedies and  collective  injunctions  and  redress  are  also  likely  to 
have positive impacts on vulnerable consumers and on the environment.        

D. Follow up 

When will the policy be reviewed? Maximum 4 lines  
In  addition  to  regular  monitoring,  an  evaluation  of  the  effectiveness,  efficiency,  relevance,  coherence  and  EU 
added value of this legislative intervention is suggested 5 years after implementation by Member States, based 
on predetermined core progress indicators. 

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