How does consumer protection law apply to me and my business?
Consumers are entitled to have their rights and interests protected by law. Irish consumer protection law, which is based on a mix of Irish and European legislation, has evolved as a distinct area of law that concentrates on the general protection and promotion of those rights and interests.
What does consumer protection law in Ireland consist of?
The following legislation provides protection for consumers and, consequently, obligations for you as a business.
- The Consumer Protection Act 2007
- The Consumer Rights Directive
- Sale of Goods Act 1893
- Sale of Goods and Supply of Services Act, 1980
- The European Communities (Unfair Terms in Consumer Contracts) Regulations 1995
- S.I. No. 11/2003 – European Communities (Certain Aspects of the Sale of Consumer Goods and Associated Guarantees) Regulations 2003
Consumer Protection Act 2007
The Consumer Protection Act 2007 (CPA) provides protection to the consumer through a variety of measures; ensuring compliance with consumer legislation, self-regulation (codes of practice) and a set of enforcement measures. The CPA applies before, during and after a transaction has taken place.
What is a trader?
The CPA defines a trader as a person who is acting for purposes related to the person’s trade, business or profession, or a person acting on behalf of a trader. Those who promote goods or services on behalf of a business may be considered a trader under consumer protection law.
What are your responsibilities under the CPA?
The CPA requires traders to be transparent and places a wide range of responsibilities on traders. Under the CPA it is a criminal offence for any retailer to make a false or misleading claim about goods, services and prices. It is also an offence to sell goods which bear a false or misleading description.
The CPA protects consumers from misleading, aggressive or prohibited practices. In other words, when a breach of good faith occurs and the consumer is denied the reasonable standard of skill and care which they are entitled to.
A misleading practice involves providing false, misleading and deceptive information. Misleading advertising, misleading information and withholding material information are considered misleading practices.
The CPA prohibits traders from engaging in aggressive practices such as harassment, coercion, or exercising undue influence. Examples of harassment are pressurising, intimidating and taking advantage of vulnerable consumers.
The CPA lists 32 commercial practices which are prohibited in all circumstances.
Social media influencers and bloggers have the same responsibilities as all those who fall under the CPA definition of a trader.
Consumer Rights Directive
The Consumer Rights Directive (CRD) came into force in 2014 and provides consumers with increased protection when they enter into on premises, off premises (doorstep sales) and distance contracts with web traders based in Ireland and other EU countries. Distance contracts include buying something online, over the phone, from a mail order catalogue or from a TV shopping channel. A range of provisions been introduced which businesses have to comply with. These provisions include bans on hidden charges, as well as an extended right of withdrawal period. You will also be obliged to refund consumers more promptly.
- Extended ‘cooling off’ period
Consumers can withdraw from a distance selling contract and seek a full refund within 14 days of the date on which they received the goods. In the case of a contract for a service, the cooing-off period ends 14 days after the contract starts. This has been extended from the previous seven day cooling off period. Your business is responsible for informing the consumer of this right. The consumer is responsible for the cost of returning the goods (as long as this cost was made clear to them beforehand). If you want, you can provide a sample withdrawal form on your website, making it easier for consumers to avail of this right.
- Ban on pre-ticked boxes
Pre-ticking boxes during the booking process may cause some consumers to inadvertently pay for extras that they do not require. Under the CRD, this practice is prohibited. Consumers must explicitly indicate that they opt-in to any extra costs (such as insurance or car hire).
- Ban on hidden fees and charges
You must disclose the total cost of the product or service, including any additional fees (e.g. taxes or delivery charges), before the order is confirmed. Consumers will not have to pay extra charges if they you do not properly inform them of these costs in advance.
- Right to quicker refunds
Previously, online sellers were obliged to refund consumers who withdrew from a contract within 30 days. Under the CRD, this period has been shortened to 14 days, and the refund must include the cost of delivery.
- Ban on surcharges
The CRD prohibits businesses from imposing credit or debit card charges which exceed the actual cost borne by the provider of offering this method of payment. If you operate a hotline, you are not allowed to charge more than the basic telephone rate for calls.
- Clearer information on the cost of returning unwanted goods
Consumers who avail of the fourteen day cooling off period have to pay for the cost of returning unwanted goods. The CRD states that if you expect the consumer to pay to return an item, you must clearly inform the consumer of this beforehand. Otherwise, you will have to cover the cost of the consumer returning the item. You are also obliged to provide an estimate of return costs in advance if the item is bulky or difficult to transport, so the consumer may make an informed choice before buying the goods.
- Protection for digital purchases
Consumers must be clearly told about the compatibility of digital content with hardware and software. They must also be told if there are any technical protection measures on an item, such as a limit on making copies. The right of withdrawal applies to digital content, but only up until the actual downloading process beginning.
How can you ensure you are complying with consumer protection law?
- Avoid engaging in a prohibited commercial practice. Make sure that, as outlined in the CPA, your commercial practices are not unfair, misleading, aggressive or prohibited. Ensure that you comply with pricing and price display regulations, as set out in the CPA.
- Avoid using unfair terms in your standard contracts. If you use standard form contracts in your business, you need to ensure that your contract terms are fair. According to the legislation, a standard term is unfair if it gives the trader an unfair advantage over the consumer, or takes away the consumer’s legal rights. The legislation, The European Communities (Unfair Terms in Consumer Contracts) Regulations 1995, requires that standard terms are written in plain and understandable language. It gives examples of terms that could be considered unfair, for example terms, which provide for an automatic renewal of a contract without the consumer’s agreement. More information on how you can ensure your contract terms are fair can be found in the CCPC’s Guidelines here. The guidelines will assist in explaining what an unfair term is and how your business can ensure that your standard form consumer contracts terms are fair.
- Make sure that you comply with obligations contained in the European Union (Consumer Information, Cancellation, and Other Rights) Regulations 2013. These oblige you to make certain information available to consumers in advance of them deciding to buy a good or service. These combine a transparency requirement, where you have to provide specific information, with a ‘cooling-off’ period, where the consumer has time to consider their purchase.
- The quality of goods and services that consumers purchase are addressed by the Sale of Goods Act 1893 and the Sale of Goods and Supply of Services Act, 1980.
- You must make sure that the goods you sell comply with the general safety requirements, for more information see product safety
What are the sanctions and penalties if you are found to be in breach of consumer protection law?
The CCPC has a range of powers to help achieve compliance with consumer protection law. These are:
- Prohibition orders
- Compliance notices
- Fixed payment notices
Additional information is included in the Enforcement section
The Small Claims procedure
In certain instances where a consumer has purchased a product and it develops a fault, it may be up to the business to put things right. As a general rule, you can either repair or replace the item. Alternatively, you can refund the costs of the item or service to the consumer. There are no specific rules as to which remedy you should provide for the consumer; the circumstances of the individual case must be taken into account.
It is important to note that, if the consumer is not satisfied with your response to their issue, they make take a claim against you using the Small Claims Procedure.