The Consumer Protection Act and its impact on entrepreneurs

If you sell goods or provide services to consumers, consumer protection concerns you directly. It is one of the areas where changes in legislation are relatively frequent, partly as a result of European legislation. This article summarises the obligations that arise from consumer protection and what to watch out for so that you avoid both fines and disputes.

Why consumer protection matters

In a commercial relationship the consumer is regarded as the weaker party, which is why the law grants them special protection. For an entrepreneur this means a set of obligations covering information, complaints and the conclusion of contracts, regardless of the size of the company. The specific rules keep evolving, so always check the exact wording of the obligations in the version of the relevant regulations currently in force.

The seller’s basic obligations

Consumer protection covers several groups of obligations that every seller should know.

• Providing clear and truthful information about the goods and the price
• Handling complaints within the set deadlines
• Complying with the rules for distance sales and off-premises sales
• Respecting the right to withdraw from the contract when buying online
• The ban on unfair commercial practices

Complaints and warranty

Complaints are one of the most sensitive areas. An entrepreneur must have a complaints procedure in place, meet the deadlines for handling complaints and properly inform the consumer of their rights. A wrongly rejected complaint is a frequent cause of disputes and inspections, and it quite often ends up in court or before alternative dispute resolution bodies. That is why it pays to have your processes clearly described and your employees trained in them, so that they act consistently, objectively and in line with the current rules. What is more, a well-handled complaint can turn a dissatisfied customer into a loyal client.

Distance sales and e-shops

Online sales require particular attention. In distance sales the consumer usually has the right to withdraw from the contract within the statutory period, and the seller has extended information obligations. E-shops should have their terms and conditions in order, along with information about delivery, payment, product reviews and the procedure for returning goods and money. Transparency in discounts and in the way prices are displayed also matters. This is precisely where changes in legislation regularly add new requirements, especially following EU directives that respond to the boom in digital commerce.

Penalties and inspections

Compliance with the obligations is checked by supervisory authorities, and breaches can lead to fines that may be substantial. Besides the financial penalty, there is also the risk of damage to your good name. That is why it is better to invest in setting up your processes correctly than to deal with the consequences of dissatisfied customers and inspections.

How to put things in order

We recommend regularly going through your terms and conditions, your complaints procedure and your information texts and comparing them with the current wording of the regulations. It is also useful to keep track of how the supervisory authorities interpret the individual obligations in practice, as the text of the act itself may not answer every situation. If you are not sure whether your documents meet the requirements, consult an expert and have them updated regularly. At Bilvao we will help you find your way through your obligations towards consumers and set up your administration so that you comply with the legislation in force and avoid unnecessary fines.

Related articles: European DAC7 legislation and the obligations of platforms, Amendments concerning eKasa and the recording of sales, Changes in the subsistence minimum and their impact.

Frequently asked questions

What are my obligations when handling complaints?

You must have a complaints procedure and handle complaints within the deadlines set by law. A wrongly rejected complaint tends to lead to disputes and penalties. As the rules can change, check the current deadlines and procedures in the version in force and train your employees in them.

Do stricter rules apply to an e-shop than to a bricks-and-mortar shop?

In distance sales the consumer usually has the right to withdraw from the contract within the statutory period, and the seller has extended information obligations. E-shops therefore need their terms and conditions and their information on returning goods to be in order. Check the specific requirements in the current wording of the regulations.