On 19 October last we were honoured by an invitation to the 1st Consumer Policy Academy, that the regional Health Ministry organised at the University of the Balearic Islands to discuss EU consumer protection.
We discussed ‘How to Legislate’ on a panel chaired by the regional Director-General for consumer matters, Francesc Dalmau, with Sara Rodríguez Marín, professor Santiago Cavanillas and professor Joan Franch. In our view, improvement in at least four areas would help to better protect consumers.
First, more transparency. The Spanish government is not particularly prone to making pedagogic efforts, if we think of State aid for instance. But such efforts would seem quite helpful in the field of consumer protection: largely, consumers do not know their rights.
In professor Cavanillas’s learned view, such efforts should also emphasise that the law is designed to protect only consumers in good faith. And not all consumers are.
Secondly, better and indeed more regulation. Codes of conduct are not perhaps utterly useless. However, given the balance of negotiating power in the era of electronic commerce, codes of conduct would seem only second-best to mandatory regulation. Platform markets tend towards dominance, and a dominant firm need not fear as much any other firm does reputational damage due to flouting a code of conduct.
Regulation includes better quality of legislation. For instance, by virtue of cross references between different Spanish laws, sexist or xenophobic advertisement is deemed an unfair trade practice affecting consumers. This is plain nonsense.
Thirdly, more deterrence. Article 83 of the General Data Protection Regulation (GDPR) shows the way ahead for privacy. Indeed, another speaker at the same conference pointed out how ludicrous maximum fines for consumer protection infringements are in certain Member States, e.g. Austria (2,500€).
The success of the Commission’s coordinated screenings or ‘sweeps’ of different sectors pursuant to Regulation 2006/2004 shows that Burruchaga’s incentive to score in the 1986 World Cup final still helps: feel someone breathing down one’s neck.
Fourthly… more Europe! Now we would say this, wouldn’t we… But one reason for this suggestion is that some Member States misread the subsidiarity principle. For instance, the Second Final Provision of the Spanish 2007 Consumer Protection Act (Real Decreto Legislativo 1/2007, de 16 de noviembre, por el que se aprueba el texto refundido de la Ley General para la Defensa de los Consumidores y Usuarios y otras leyes complementarias, short – or at least a bit shorter –‘TRLGPCU’) allow the country’s 17 regions to develop Articles 19 and 20 of the Act, i.e. notably precontractual information requirements. Some have created obligations which go beyond Directive 2005/29/EC. This fragments the national market and, by the same token, the EEA market.
Fragmentation also weakens consumer protection. A region may efficiently regulate the baker around the corner, but not necessarily a large multinational corporation. Perhaps certain aspects of consumer protection should be the subject of a Regulation?
From a consumer’s perspective, we should add that lunch was served at the regional hotel management school, and was superb. The next generation of tourists to the Balearic Islands have something to look forward to. So do we!