Last week's ratification by the European Parliament of the Unfair Commercial Practices Directive was hailed yesterday by EU health and consumer protection commissioner Markos Kyprianou.

"This law marks a big step forward for consumers and for EU competitiveness," he said. "It boosts the protection consumers enjoy across the EU, while simplifying the regulatory environment for businesses."

In all there are twenty-eight business practices now specifically defined as unlawful, among them ...

Pressure selling

  • Implying that the consumer cannot leave the shop until they sign a contract.
  • Conducting personal visits to the consumer's home and ignoring the consumer's request to leave or not to return.

    Misleading marketing
  • Claiming to be a signatory to a code of conduct when the trader is not.
  • Advertising discount airline prices that apply only to a few seats on a certain route.
  • Describing a product as 'gratis', 'free', 'without charge' etc if the consumer has to pay anything other than unavoidable delivery or collection costs.

    Advertising to children
  • The directive also places tight controls on ads aimed at children, banning any that include "a direct exhortation to children to buy or to persuade their parents or other adults to buy advertised products for them".

  • It also lays down general principles which can be used to assess whether other types of practices should be prohibited as unfair. The key test, in most cases, is whether the practice would unfairly distort the behaviour of an 'average' consumer; though there are also provisions aimed at preventing exploitation of particularly vulnerable consumers.

    The EU claims that by defining only what should be prohibited rather than telling firms how to go about their business, the law leaves room for business to innovate in developing new, fair commercial practices.

    Companies who comply with the rules will be able to do business in all EU countries. Independent economic studies predict the new law will increase consumer choice, stimulate competition and enlarge the horizons of small and medium sized businesses in Europe.

    The law is expected to be formally endorsed by the Council of Ministers in the coming weeks and should be implemented EU-wide by 2007.

    Data sourced from multiple origins; additional content by WARC staff