COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT REPORT Accompanying the document PROPOSAL FOR A DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2011/83/EU concerning financial services contracts concluded at a distance and repealing Directive 2002/65/EC
Date: 2022-05-11
Institutions: Directorate-General for Justice and Consumers, European Commission
Subjects: Internet, approximation of laws, consumer information, contract, distance selling, financial services, provision of services, single market

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   EUROPEAN COMMISSION  Brussels, 11.5.2022  SWD(2022) 142 final  COMMISSION STAFF WORKING DOCUMENT  EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT REPORT  Accompanying the document PROPOSAL FOR A DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL  amending Directive 2011/83/EU concerning financial services contracts concluded at a distance and repealing Directive 2002/65/EC               {COM(2022) 204 final} - {SEC(2022) 203 final} - {SWD(2022) 141 final}  
 
 
Executive Summary Sheet 

Impact  assessment  on  the  Review  of  Directive  2002/65/EC  concerning  the  distance  marketing  of  consumer 
financial services.  

A. Need for action 

What is the problem and why is it a problem at EU level?  

The overarching problems are: 1) a lack of coherence and the decreased relevance of the Directive due to 
overlap  with  product-specific  and  horizontal  legislation;  2)  consumers  using  financial  services  by  means  of 
distance communication are  not sufficiently protected and face  detriment  (limited consumer awareness  of 
the key elements and costs of some financial services, suboptimal use of the right of withdrawal, new market 
practices  exploiting  patterns  in  consumer  behaviour);  and  3)  the  competitiveness  of  the  single  market  for 
financial services sold by means of distance communication has not been fully achieved.  

The causes of these problems are: a regulatory framework that fails to ensure legal certainty; behavioural 
biases  that  are  exploited  by  financial  service  providers;  and  barriers  to  the  possible  increase  in  the  cross-
border provision of financial products. The consequences of these problems for consumers are: detriment if 
they buy an unsatisfactory product; lack of sufficient trust as a basis for using a financial service, both in the 
consumer’s  home  EU  country  and/or  cross-border;  and  a  resultant  loss  of  welfare.  For  businesses  the 
consequences  are:  an  uneven  playing  field;  extra  compliance  costs  and  a  loss  of  welfare  due  to  the  lack  of 
realisation of the single market’s potential. If no action were taken, this state of affairs would continue to be 
the case. 

What should be achieved? 

The  general  objectives  of  the  Directive’s  review  are  1)  to  streamline  the  regulatory  framework,  ensuring 
greater clarity for all stakeholders and a high level of consumer protection; 2) to reduce detriment and ensure 
a high and consistent level of protection for consumers purchasing financial services at a distance; and 3) to 
facilitate the cross-border provision of financial services and the competitiveness of the single market. This 
is in line with the Directive’s original objectives. 

What is the value added of action at EU level (subsidiarity)?  

The revision would lead to a clearer legislative framework that ensures legal certainty, whilst safeguarding 
the ‘safety net’ feature. Having horizontal consumer rights covering current and future financial services that 
appear on the market is something that can only be achieved at EU level. 

B. Solutions 

What  are  the  various  options  for  achieving  the  objectives?  Is  there  a  preferred  option  or  not?  If  not, 
why? 

The  options  assessed  are:  Option  0:  no  policy  change  scenario;  Option  1:  repeal  of  the  Directive  and  non-
regulatory  measures;  Option  2:  comprehensive  revision;  Option  3a:    relevant  provisions  introduced  into 
horizontal legislation; and Option 3b: relevant provisions introduced in product-specific legislation. Based on 
the  impact  assessment,  the  preferred  option  would  be  Option  3a:  repeal,  the  modernisation  of  relevant 
rights and injected into horizontal legislation, namely Directive 2011/83/EU on consumer rights (Consumer 
Rights Directive). 

What are different stakeholders’ views? Who supports which option?  

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Consumer organisations tend to favour a comprehensive revision of the Directive (Option 2), but they could 
accept  repeal  and  the  insertion  of  the  Directive’s  relevant  provisions  into  horizontal  legislation  (Option  3a). 
Financial service providers and business associations prefer the baseline scenario or Option 3b (putting the 
consumer rights into product-specific legislation). Public authorities believe the best option is to incorporate 
parts of the Directive into horizontal legislation (Option 3a). 

C. Impacts of the preferred option 

What are the benefits of the preferred option (if any, otherwise the main ones)?                                     

The  preferred  option  is  an  effective  way  of  achieving  the  specific  objectives,  as  well  as  being  efficient,  in 
particular  for  consumers,  and  ensuring  a  high  level  of  coherence.  The  option  is  expected  to  have  a  positive 
effect overall on consumer trust by introducing new rules on how and when information should be given to 
consumers and by limiting practices  that  exploit patterns of behaviour, such as  the use of default options.  It 
will also modernises the right of withdrawal by rendering the exercise of this right more straightforward. The 
option would have a positive effect on reducing consumer detriment (at least EUR 170-210 million). 

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

Adopting the preferred option would result in additional one-off and recurring costs for businesses. This is 
because measures under this policy option would require service providers to familiarise themselves with the 
improved  Consumer  Rights  Directive,  adapt  their  IT  systems,  train  staff,  update  their  websites  and  update 
contracts.  After  the  initial  implementation  of  changes,  no  significant  increase  in  recurrent  costs  is  expected. 
This option would entail around EUR 19 million in costs for businesses. 

What are the impacts on SMEs and competitiveness?  

According to  the analysis  of the support study  and the feedback  from stakeholders,  small  and medium-sized 
enterprises  (SMEs)  should  not  be  disproportionately  affected  in  comparison  to  larger  enterprises.  The  main 
types of impacts identified in this assessment would also apply proportionately to SMEs. 

Will there be significant impacts on national budgets and administrations?  

The  preferred  option  would  entail  some  one-off  and  recurrent  costs  for  national  authorities.  Authorities 
would bear some transposition and implementation costs during the adoption phase, but these would not be too 
burdensome,  since  the  new  provisions  are  minimal.  Additional  monitoring  and  enforcement  costs  would  be 
incurred due to the introduction of new rules, such as the prohibition of default options and the adaptation of 
presentational rules for different distribution channels. 

Will there be other significant impacts?  

The initiative is expected to simplify the legal framework by repealing the Directive, while maintaining the 
‘safety net’ feature by injecting relevant articles of the Directive into existing consumer legislation. The new 
rules on the distance marketing of consumer financial services will also benefit from the application of certain 
rules of the current Consumer Rights Directive.  

Proportionality?  

The preferred option will not go beyond what is necessary in order to achieve the objectives. The initiative 
will cover only  what EU countries  cannot  achieve on their own and  only the areas  where the administrative 

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burden and costs are commensurate with the specific and general objectives to be achieved. 

D. Follow-up 

When will the policy be reviewed?  

The Commission will monitor the implementation of the policy chosen, if adopted, after its adoption. A list 
of monitoring indicators in the impact assessment will serve as a basis for the next evaluation.  

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