Its not just ticking the boxes
As of June 13th, EU Directives come into law across Europe which bring in new consumer rights and which have significant impact on trading websites, including the ban on websites using pre-ticked opt-in boxes.
The EU Consumer Rights Directive was introduced in 2011 with the aim of harmonising consumer rights across the EU and further increasing confidence in online trading. Member states were given until 13th December to incorporate it into their national legislation, and 13th June was the deadline for businesses to be compliant with it, after which non-compliant websites risk prosecution or finding they have unenforceable contracts.
IMPLEMENTATION IN UK LAW
In the UK, these regulations were originally intended to be included in the Consumer Rights bill. However, that bill has been delayed so in order to meet the deadline, the regulations have confusingly been incorporated instead into the Consumer Contract Regulations 2013, but will later be repealed and instead incorporated into the Consumer Rights Bill. Unlike the so-called "cookie" law, which received countless pages of press, these changes to legislation have gone relatively unnoticed, even though they do have much more impact on trading website operators and consumers.
REQUIREMENTS FOR INCREASED TRANSPARENCY
One significant change is the requirement for increased transparency about costs. Websites must be clear about all costs before the order is placed, a change which will probably affect the many online shops which have postage costs buried away in the small print and which don't calculate the postage costs until you are well into the checkout process.
Another requirement for increased transparency is that contracts must make it clear that payment is required. This may sound strange, obviously payment is required, but it is intended to outlaw fraudulent and deceptive contracts such as the directory scams where people tick a box to say they would like a directory entry, thinking it is free, only to find out later that they have been entered into a binding contract for which payment is demanded.
In the UK, it is likely that website payment buttons will, at a minimum, be required to unambiguously read "Pay Now" at the point where payment occurs, rather than the less definitive "Order" or "Continue" texts which some online shops use.
CLARIFICATION OF RETURN COSTS
An area where regulations had previously been muddy rather than transparent concerns returns costs. The Distance Selling Regulations gave consumers a seven day no-quibble cooling off period, and this has now increased to a minimum of 14 days and explicitly from the time the goods are received as opposed to the previous regulation of when the goods were ordered. During the cooling off period, the consumer can return goods for a full refund without needing to give any reason, and companies must provide clear and easy to understand cancellation options. If a company fails to properly set out the consumer's cancellation rights then the consumer now has a full year during which they can demand a refund.
Companies are not allowed to charge a restocking fee when processing returns but it was unclear from the previous regulations if companies were required to refund postage costs. The revised regulations say that companies must explicitly state at the point of sale if they want the customer to bear the costs of return postage on cancellations. If goods are returned because they are faulty or not as ordered, the trader still has to bear the full costs of returns.
IMPROVED PROTECTION FOR TRADERS
The wording of the regulations has also been improved to protect the trader, so now, for instance, it is clear that the trader does not have to issue the refund until the goods are back in their possession and that they can now make reasonable deductions if there is clear evidence that the goods have been used or damaged by the customer. However, some have expressed concern that rogue traders will use this clause to routinely withhold refunds, with the danger that this will undermine confidence in online trading.
UNREASONABLE SURCHARGES PROHIBITED
Another welcome change which has received too little coverage is that companies can no longer levy unreasonable surcharges on certain methods of payment such as credit cards. Any surcharges are now limited to the actual cost incurred by the trader. The law also sees an end to companies using premium rate numbers for customer service or complaints lines. As of 13th of June, companies continuing to use 0845, 0870 or 09 numbers for customer services are risking prosecution by Trading Standards.
NO PRE-TICKING OF OPT-IN BOXES
The topic which has received most press coverage is "you can no longer pre-tick boxes". The idea is that you can no longer use pre-ticked boxes or other default settings to opt people in to mailing lists etc as a result of purchasing, and you cannot pre-tick options which incur further charges, charged extras, automatic renewals, and so on.
It isn't the case that all pre-ticked boxes are banned, but rather that you cannot opt people into optional extras without a positive action on their part. For instance, some companies appear to have read only tabloid headlines and think they can get round this regulation simply by making the question negative, such as "Tick this box if you don't want to go on our mailing list". That is a rather naive and misinformed interpretation. The regulations themselves refer to default options and positive actions required by the consumer, not pre-ticked boxes.
24th June 2014
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