Boosting Consumer Confidence

The Commission says that consumer confidence needs a boost and that this is key to revitalising Europe’s economy. This is the premise of the Commission’s recent publication of a strategy for boosting consumer activity over the next few.

This strategy aims to restore confidence through four key actions: maximising consumer participation and trust in the market by reinforcing consumer safety, enhancing knowledge, stepping up enforcement and securing redress and aligning consumer rights and policies to changes in society and in the economy. The strategy also puts forward a number of key actions to be implemented between now and 2014 and focuses on five major consumer sectors.

Why Now?

The Strategy outlines the problems and challenges currently undermining consumer confidence in Europe. The globalisation of production chains for example means that the detection of unsafe products is a more significant challenge than ever before. Market surveillance authorities are therefore required to be more vigilant. The economic crisis and population ageing has also increased the risk of social exclusion.

The digital revolution has also changed the environment within which commercial transactions are carried out. The Internet has altered patterns of consumption and opened up new opportunities such as e-commerce and cloud computing. These opportunities however are yet to be fully tapped. Citizens also face an information overload, and a recent Commission survey found that consumers are often not aware of their rights.

The Commission has identified specific challenges in key sectors that must be addressed. Although the liberalisation of energy, transport, electronic communications and financial services has provided consumers with a number of potential benefits, citizens are still not taking full advantage due to a lack of transparency of tariffs and information. This is why the Commission has decided to focus his Agenda on certain sectors of the economy.

The Objectives

The Consumer Agenda should be seen as a continuation of the policies put forward in other initiatives such as the EU Citizenship Report, the Single Market Act, the Digital Agenda for Europe and the Resources Efficiency Roadmap. The four main objectives, which are designed specifically to increase consumer confidence, are also in line with the objectives of the EU's growth strategy, Europe 2020.

Reinforce consumer safety

The first objective of the Agenda is to reinforce consumer safety for goods, services and food, strengthen the regulatory framework and make market surveillance more efficient.

In 2012, the Commission will discuss a Green Paper on safety of certain consumer services, review the Regulation on Official Controls along the Food Chain to simplify and ensure a sufficient and sustainable funding. It also plans to revise the legal framework governing Animal Health, Plant Health and Plant Reproductive Materials and revise the Food Hygiene Regulation. Customs and market surveillance authorities will cooperate in evaluating the results of import controls by 2014, based on guidelines for import controls in the area of product safety compliance.

Enhance knowledge

The second objective of the Agenda is to enhance consumer knowledge in order to ensure that citizens are equipped to cope with the increasing complexity of markets. The Commission firmly believes that consumers need the right tools and information if they are to fully understand issues ranging from the real cost of consumer credit to finding the right place to complain.

This issue is important for both consumers and traders, and the Commission envisages that the role of consumer organisations as facilitators of knowledge will be crucial.

The Strategy includes actions and measures with the aim of raising awareness of consumer rights and interests among both consumers and trade, and building knowledge and capacity for more effective consumer participation in the market.

In 2013, the Commission will launch an EU-wide campaign to increase knowledge about consumer rights and interests in 2013. Between 2012 and 2013, non-profit organisations providing general financial advice to consumers will receive specific training from the Commission.

Also, the Commission will: 
• Strengthen the existing EU-wide networks on consumer and traders information, such as the European Consumer Centres’ Network and the Enterprise Europe Network.
• Improve the information on its own web pages, such as the YourEurope portal by complementing it with specialised information tools.

Improve enforcement and securing redress

If consumers have no redress and if laws are not adequately enforced, then rights cannot exist in practice. This is a significant issue: the Commission estimates that consumer problems that lead to complaints cost the European economy around 0.4 % GDP. In order to counter this, the Commission aims to encourage the role of consumer enforcement networks.

In practice, the Commission plans to publish a Report evaluating the effectiveness and operational mechanisms of the Consumer Protection Cooperation Regulation. It will also:
• Update the guidance document on application of the Directive on Unfair Commercial Practices to give a more prominent role in monitoring and coordinating enforcement to the Member States. 
• Develop a Consumer Law Database that will become an integral part of the e-Justice portal in 2013.
• Draft Guidelines to facilitate and improve the application of different Passenger Rights Regulations. 
• Publish guidelines on the application of Article 20(2) of the Services Directive to help reduce unjustified refusals to supply cross-border services online.
• Promote compliance with basic consumer protection principles with its key trading partners (in particular with China).
• Ensure the adoption and application of its recent proposal on Alternative Dispute Resolution (ADR) and Online Dispute Resolution (ODR).
• Consider an initiative for an EU framework for collective redress on the basis (following the European Parliament Resolution on “Towards a Coherent European Approach to Collective Redress”).

Societal change

Aligning consumer policy to recent changes and making it relevant to daily life is the Agenda’s fourth main objective. In order to achieve this, the Commission aims to adapt consumer law to the digital age, and tackle problems consumers face online. The Agenda also aims to factor in the needs of vulnerable consumers and to make sustainable choices easy.

In this area, the Commission has already proposed some measures, such as the Common European Sales Law, the Data Protection Reform package.

Key sectors

Finally, the Agenda aims to target five key consumer sectors. These sectors are food, energy, finance, transport and digital.

Food

The Commission objective in the food sector is to ensure sustainability and safety. The Commission will study initiatives as regards the labelling of food origin and the labelling of alcoholic beverages, along with actions targeted at sustainable food, including the prevention of food waste.

Energy

The Commission wants to ensure that consumers can get the best value for money in the liberalised energy market and better manage their energy consumption. Energy field actions will include guidelines on price transparency in the retail energy market, aimed at informing consumers how to better manage their domestic energy consumption, and a review the Energy Labelling Directive.

Finance

The Commission’s main objective in the finance sector is to protect consumer financial interests and give citizens the tools to manage their finances. Legislative actions will include a proposal on Packaged Retail Investment Products, with the objective of requiring clear and understandable key information for consumers and an evaluation of the implementation of the Consumer Credit Directive.

The Commission is also planning a study on household indebtedness and a legislative initiative on banks accounts focused on increasing consumer awareness of the fees they pay for basic banking services.

Transport

The Commission wants to adapt legislation to modern patterns of travel and to support sustainable mobility. An updated Package Travel Directive will be proposed by 2013, while the rules on Air Passenger Rights, which protect travellers from denied boarding, long delay and cancellation situations, will be revised.  The Commission also intends on putting forward a proposal to review the CO2 car labelling rules in 2013 and an initiative to develop an alternative fuel strategy.

Digital

The Commission wants to use the Agenda to tackle digital commerce problems faced by consumers and ensure that they are protected online. Proposed actions in this field include a legislative proposal on collective rights management in 2012, a Report on the implementation of the Unfair Commercial Practices Directive in 2012, focusing on the rules aimed at protecting children from misleading advertising, and a proposal on a legislative framework for electronic identification, authentication and signatures. This would set out minimum requirements for information on website locations and guarantee the authenticity of the website.

A Communication on online gambling will be presented in 2012, while the Commission will also put forward a Green Paper on card, internet and mobile payments in 2013.