The changes for consumer protection are several and affect several diplomas and sectors. Perhaps because of this, the Portuguese legislator took more than a year to transpose the Omnibus Directive, having given businesses almost six months to adapt.
The distribution and retail sector is one of the most affected by the Omnibus Directive. It should be noted, however, that the scope of application of both Decree-Law 109-G/2021 and the Omnibus Directive is very broad, covering any type of goods or services (including those of a digital nature), from the food sector to the technology, childcare and clothing sectors, and even the sale of water, gas or electricity in a limited volume or quantity. In fact, no one is spared.
We highlight the main changes to be taken into account by commercial operators in this sector regarding contracts entered into with consumers as of 28 May 2022:
- Consumers are now more protected when entering into contracts for the supply of digital content (e.g. software, applications, video and audio files and e-books), digital services (e.g. file storage, cloud computing services provided to consumers, content or music streaming platforms or online games), or any other contracts that focus on consumer goods with digital elements, and these will now be subject to the same rules as contracts for the purchase and sale or supply of conventional goods.
- Techniques aimed at deliberately reducing the lifetime of a consumer good in order to stimulate its replacement (so-called planned obsolescence) are expressly forbidden.
- When concluding distance or off-premises contracts, the supplier of goods or the provider of services is obliged to provide the consumer with a wider set of pre-contractual information. This has been the case since 2014, but from now on with the Omnibus Directive the following is also required, in particular:
— Indication that the price has been personalised on the basis of an automated decision (if applicable);
— Indication of the warranty period for digital content or services, whenever these are embedded in or interconnected with consumer goods;
— Detailed information on possible other means of online communication provided by the supplier of goods or the provider of services that facilitate contact with the consumer and that allow to retain all written correspondence stored on a durable medium;
— Sending the consumer information in advance about the main characteristics of the goods or services, the identity of the provider, the total price, the right to withdraw, the duration of the contract and, if the contract is open-ended, the conditions for terminating it;
— Some specific additional information requirements prior to the conclusion of contracts concluded on online marketplaces.
- In the specific case of off-premises contracts concluded at the consumer's home or in the context of package tours the period during which the consumer may freely and without any need for justification withdraw from the contract (the so-called 'right of withdrawal') is extended from 14 to 30 days.
- According to the Omnibus Directive, in the case of commercial practices involving price reductions (sales, promotions or liquidations), the supplier of goods or the provider of services is obliged to:
— Indicate, on any medium used to publicise them, the lowest price previously practised, by reference to the prices practised in the 30 days prior to the reduction (and not already in the 90 days prior), with the indication of the percentage reduction becoming merely optional;
— Indicate the price reduction by reference to the lowest price previously practised during the last 15 consecutive days the product was on sale (or during the total period the product was made available to the public, if this is shorter), whenever the price reduction concerns perishable agricultural and food products (i.e. products which are likely to become unfit for sale within 30 days of the date of harvest, production or processing) or products which are 4 weeks from their expiry date;
— When comparing with reference prices, to not use different measures or conditions (e.g. comparison between products sold in packages and products sold by the unit).
- With the introduction of the Omnibus Directive, these are now considered unfair commercial practices and are punishable as a serious economic offence:
— The commercial promotion of a good as being identical to another good marketed in the European Union, if that good is significantly different as regards its composition or characteristics;
— Claiming that ratings of a product are given by consumers who have actually used or bought it, without taking reasonable and proportionate steps to verify that those ratings were published by those consumers;
— Submitting (or soliciting third parties to submit) false consumer ratings or recommendations, or distorted ratings or recommendations on social media in order to promote products;
In the case of products offered through a marketplace, the omission of information on whether or not the marketplace provider is a professional, in the contract proposal or invitation to treat addressed to the consumer;
— In cases in which the search for products offered by different professionals or by consumers is possible through searches in the form of a key word, phrase or other data: the lack of information on the parameters determining the ranking of the products presented to the consumer as a result of the search and the relative importance of these parameters compared with other parameters.
- Finally, in order to counteract the inclusion in consumer contracts of unfair general contractual terms - increasingly common, despite their recognised nullity, given the potential dissuasive effect of the inclusion of these terms and the absence of any additional punishment - the use of general contractual terms classified by Decree-Law no. 446/85 as absolutely prohibited is now punishable as a very serious administrative offence.
The above list is only a summary of a very vast set of requirements whose approval and entry into force seem to have passed unnoticed by several operators. It is time to confirm if all these measures are properly implemented, to create new procedures and to make risk analyses.
Consumer protection has been the order of the day and the only defence for companies, the only way for them to mitigate the risk of compensations, popular actions, fines and even pressure in social networks, inevitably involves prevention.