Wednesday, June 4, 2014
New Regulations for Consumer Sales Come Into Effect 13 June 2014
Do you Sell To Consumers? Additional rules apply to contracts concluded with consumers after June 13 2014 for on-premises contracts (buying in a shop), distance contracts (including online sales) and off-premises contracts. Different rules apply to the different types of sales. The following article is published thanks to Michelle McLoughlin, Solicitor, Legal Consultant and Trainer.
The cooling off period (right to cancel a contract without giving any reason if it is an off-premises or distance contract that can be cancelled) is being extended from seven to fourteen days. Web order buttons require new wording.
The rules are set out in the European Union (Consumer Information, Cancellation and other Rights) Regulations 2013 (the Regulations).
What Are Your Obligations?
- To provide clear and comprehensive Information
- The information to be provided for on-premises contracts is set out in Schedule 1 to the Regulations.
- The information to be provided for off-premises contracts and distance contracts is set out in Schedule 2 to the Regulations.
- The information must be legible and in plain intelligible language.
- A copy or confirmation of the contract must be provided to the consumer within a reasonable time of the contract being concluded.
- Consumers are not liable for costs and expenses where the information on such charges is not provided to the consumer – for example freight, delivery, postal charges or costs of returning the goods.
- Any delivery restrictions and the accepted means of payment must be set out at the outset.
- To ensure that the consumer explicitly acknowledges that the order implies an obligation to pay.
- If the consumer needs to activate a button or similar function to purchase, the button should contain a label, with only the legible words “Order with obligation to pay” or other equivalent unambiguous language.
- For contracts that can be cancelled the model cancellation form (set out in Schedule 3 Part B of the Regulations) must be given to consumers. Model instructions for cancellation are set out in Schedule 3 Part A to the Regulations.
Certain activities are excluded from the Regulations. For off-premises contracts concluded at the same time there is an exclusion from the Regulations where the aggregate payment by consumers does not exceed €50.
Consequences of Failing to Comply with the Regulations
- The contract is not enforceable;
- If the cancellation information requirements are not met then the cooling off period in an off-premise or distance contract is extended from fourteen days to twelve months. In order to stop this time period you would need to write to the consumer providing him/her with the necessary information and then the cooling off period will end 14 days after the consumer receives the necessary information;
- Criminal Offence. Fines of up to €5,000 (class A fine) and/or 12 months imprisonment for a summary conviction or fines of up to €60,000 and/or 18 months imprisonment for a conviction on indictment.
Action Points to Ensure Your Compliance with the New Rules
- Review the Regulations to see:
- if your business falls within any of the categories covered by the Regulations.
- if your business falls within any of the exclusions.
- Review your existing terms and conditions of sale in light of the Regulations.
- Update your terms and conditions to meet the new requirements.
- Have a cancellation form available for consumers. A model cancellation form and model instructions for cancellation are set out in Schedule 3 to the Regulations.
- Update the ordering button to contain the words “Order with obligation to pay” or other equivalent unambiguous language.
Information taken from the Regulations and the Explanatory Note. http://www.djei.ie/publications/sis/2013/si484.pdf
For further information please contact Michelle McLoughlin, Solicitor, 087 6674534 or visit http://www.mmcloughlinsolicitors.com/.
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