Las propuestas de directiva sobre compraventa en línea y sobre suministro de contenidos digitales (Parte II): conformidad y remedios por falta de conformidad
| Autor | Rosa Mila |
| Cargo | Centro de Estudios de Consumo, Universidad de Castilla-La Mancha |
| Páginas | 50-63 |
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Universitat Oberta de Catalunya
Submission date: November 2016
Accepted date: January 2017
Published in: February 2017
ARTICLE
The Directive Proposals on Online
Sales and Supply of Digital
Content…
(Part II): conformity and remedies
for lack of conformity*
Rosa Milà Rafel
Juan de la Cierva-Incorporación Researcher
Centro de Estudios de Consumo, Universidad de Castilla-La Mancha
Abstract
This article aims to critically analyse the two proposals for Directives that the European Commission
launched on 9 December 2015: the Online Sales Directive and the Digital Content Directive. Both proposals
are part of the Digital Single Market Strategy for Europe. Their main objective is to eliminate one of
the barriers to cross-border trade: differences in contract law between Member States. This article
is structured in two parts, published separately. This second part of the article highlights the most
significant rules governing conformity and the remedies for lack of such conformity with regard to
each proposed Directive. It also raises questions as to the justification of their particular format. It can
be concluded that the Online Sales Directive introduces some improvements and clarifications to the
Consumer Sales Directive that will either increase or maintain the current level of consumer protection
in most Member States. Nevertheless, in some Member States the Online Sales Directive will undoubtedly
lead to a reduction in the existing level of protection. The Digital Content Directive rules on conformity
and the remedies for lack of conformity of digital content also raise some significant issues. It can be
argued that some rules need to be clarified or revised. They include the rule under which contractual
terms take precedence over objective criteria when assessing the conformity of digital content and the
provision on damages that limits the consumer’s right to seek compensation for damages incurred in
their digital environment.
* A preliminary version of this article was presented at the 12th International Conference of Internet, Law and Politics:
building a European Digital Space, organised by the Universitat Oberta de Catalunya, Barcelona, 7-8 July 2016, which
has been published in the congress proceedings.
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The Directive Proposals on Online Sales and Supply of Digital Content…
Keywords
Digital Single Market, full harmonisation, consumer protection, online sales, supply of digital content,
remedies for lack of conformity
Topic
consumer protection in online sales and supply of digital content
Las propuestas de directiva sobre compraventa en línea
y sobre suministro de contenidos digitales (Parte II):
conformidad y remedios por falta de conformidad
Resumen
El presente artículo tiene como objeto el análisis crítico de las dos propuestas de directiva que la Comisión
Europea presentó el 9 de diciembre de 2015: la Directiva sobre compraventa en línea y la Directiva
sobre contenidos digitales. Ambas propuestas forman parte de la Estrategia para un Mercado Único
Digital para Europa. Su principal objetivo es eliminar una de las barreras del comercio transfronterizo:
las diferencias entre el derecho contractual de los Estados miembros. Este artículo se estructura en dos
partes, publicadas de forma separada. Esta segunda parte del artículo analiza las principales reglas por
las que se rigen la conformidad y los remedios por falta de conformidad en cada una de las directivas
propuestas. Además, plantea la cuestión de la justificación de la existencia de normas particulares para
este tipo de contratos. Se puede concluir que la Directiva sobre compraventa en línea introduce algunas
mejoras y aclaraciones respecto de la Directiva sobre venta de bienes de consumo, que incrementarán
o mantendrán el nivel actual de protección de los consumidores en la mayoría de los Estados miembros.
No obstante, en algunos Estados miembros, la Directiva sobre compraventa en línea, indudablemente,
supondrá una reducción del nivel existente de protección. Las reglas de la Directiva sobre contenidos
digitales relativas a la conformidad y los remedios por falta de conformidad de los contenidos digitales
también plantean algunas cuestiones importantes. Se puede afirmar que algunas reglas necesitan ser
aclaradas o revisadas. Entre otras, la regla según la cual prevalecerán los términos contractuales sobre
los criterios objetivos en la evaluación de la conformidad de los contenidos digitales y la regla sobre
daños y perjuicios que limita el derecho de los consumidores a solicitar una indemnización para aquellos
daños causados a su entorno digital.
Palabras clave
Mercado Único Digital, armonización completa, protección del consumidor, compraventa en línea, sumi-
nistro de contenidos digitales, subsanación en caso de falta de conformidad
Tema
protección del consumidor en la compraventa en línea y en el suministro de contenidos digitales
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The Directive Proposals on Online Sales and Supply of Digital Content…
1. Introduction
This paper aims to critically analyse the two proposed
Directives that the European Commission launched on 9
December 2015, namely the Proposal for a Directive on
certain aspects concerning contracts for the supply of digital
content (the “Digital Content Directive” or “DCD”)
1
and the
Proposal for a Directive on certain a spects concern ing
contracts for the online and other distance sales of goods
(the “Onlin e Sales Directive” or “OSD”).
2
Both proposals are
part of the Digital Single Market Strategy for Europe adopted
by the European Commission in May 2015. This strategy aims
to transform the current 28 national digital markets into a
EU digital single market by tackling all major obstacles to
the development of cross-border e-commerce in Europe.
3
The Commission estimates that dismantling these barriers
would increase European GDP by €4 billion per year.
4
The Council has given priority to the consideration of the
Digital Content Directive over the Online Sales Directive,
which is being discussed in Council working group.5 Both the
Council working group and the Parliament have welcomed
the proposal on Digital Content, with some reservations.
6
This article is structured in two parts, which will be published
separately.
— Part I, entitled “Will the new rules attain their objective
of reducing legal complexity?”, was published in the last
issue of the journal. It aims at answering the question
of whether the new rules will attain their objective of
reducing the legal complexity of online sales and supply
of digital content in Europe. Firstly, it briefly introduces
the purpose of the Directives and their precedents. And
secondly, with regard to each Directive, it discusses what
kind of contracts are covered by the Directives, how these
contracts are currently regulated in Europe and what the
implications of the new Directives are, if adopted, for the
contract law of Member States.
— Part II, entitl ed “Conformity and remedies for lack of
conformity”, is published in this issue of the journal. It
highlights the most significant rules governing conformity
and remedies for lack of such conformity with regard to
each proposed Directive. It also raises questions as to the
justification of their particular format. These will include
suggestions that I consider need to be clarified or revised.
2. Online Sales Directive:
new elements and clarifications
as introduced compared
to the Consumer Sales
The Online Sales Directive takes as its basis the existing
Directive 1999/44/EC of the European Parliament and
of the Council of 25 May 1999 on certain aspects of the
sale of consumer goods and associated guarantees
7
(the “ Consumer Sales Directive 1999/44/EC” or “CSD”).
However, the proposal introduces some improvements
and clarifications to the latter that are to be welcomed
because they will either increase or maintain the current
level of protection in most Member States, albeit only in
relation to online sales and other distance sales of goods.
8
In this section I discuss the most important changes that
1. Brussels, 9.12.2015, COM (2015) 634 final.
2. Brussels, 9.12.2015, COM (2015) 635 final.
3. European Commission (2014, p. 3). According to this communication, fragmentation and barriers in the European digital market prevent
Europe from making the most of its capabilities to lead the global digital economy. A Digital Single Market is “one in which the free
movement of goods, persons, services and capital is ensured and where individuals and businesses can seamlessly access and exercise
online activities under conditions of fair competition, and a high level of consumer and personal data protection, irrespective of their
nationality or place of residence”.
4. Explanatory memorandum OSD, p. 12.
5. See Council of the European Union (2016, p. 2). The European Economic and Social Committee also considers that “the rules on sales of
digital content [are] the priority” [see European Economic and Social Committee (2016, conclusions and recommendations no. 1.10)].
6. H. Beale (2016b, p. 11). See Council of the European Union (2017) and European Parliament (2016a) and (2016b).
7. Official Journal L 171, 07/07/1999, Pp.
8. The Online Sales Directive only applies to sales contracts for tangible movable goods that are concluded online or through any other
means of distance communication, such as telephone or postal mail [Arts. 1 and 2.e) OSD].
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The Directive Proposals on Online Sales and Supply of Digital Content…
the approval of the Online Sales Directive would entail for
the law of the Member States.
2.1. Conformity criteria of the goods
with the contract
Under the Online Sales Directive, the conformity criteria of
the goods with the contract are fully harmonised by applying
a combination of subjective and objective requirements,
9
primarily following the rules laid down in the Consumer
Sales Directive (Art. 2 CSD).
10
In any case, the conformity of the goods should be assessed
with regard to the relevant contract terms, including any
pre-contractual statement which forms an integral part of
the contract.
According to Article 4.1 OSD, goods shall be: a) “of the quantity,
quality and description required by the contract […]”;
11
and b) “fit
for any particular purpose for which the consumer requires them
and which the consumer made known to the seller at the time of
the conclusion of the contract and which the seller has accepted”.
Additionally, the conformity standards as set forth in the
contract can be raised taking into account certain objective
requirements which constitute the standards normally
expected for goods (Art. 4.2 OSD).
12
These objective
requirements as laid down in Articles 5, 6 and 7 OSD apply
unless the parties have agreed otherwise. In particular, the
goods shall, where relevant:
a) Be fit for the standards normally expected for the goods
(Art. 5 OSD). In particular, their fitness shall be “for all the
purposes for which goods of the same description would
ordinarily be used” [Art. 5.a) OSD]; accessories will be
deemed to include, “packaging, installation instructions or
other instructions as the consumer may expect to receive”
[Art. 5.b) OSD]; and the normal qualities and performance
capabilities of the goods shall meet the standard of “goods
of the same type and which the consumer may expect given
the nature of the goods” [Art. 5.c) OSD].
13
b) The goods in question shall be properly installed (Art.
6 OSD). Any lack of conformity resulting from incorrect
installation of the goods must be considered as constituting
a lack of conformity with the contract if the reason for
the incorrect installation is within the seller’s area of
responsibility, either because the goods were installed by the
seller or under his responsibility [Art. 6.a) OSD] or because
the goods were installed by the consumer but the incorrect
installation is due to incorrect instructions [Art. 6.b) OSD].
14
c)
Be free from any third-party rights, including those based
on intellectual property (Art. 7 OSD). Thus the Online Sales
Directive explicitly establishes that conformity covers not
only material defects but also legal defects.
The Online Sales Directive grants to the parties freedom
of contract regarding the objective conformity criteria.
15
Standards normally expected for the goods can be lowered
by agreements excluding or limiting the effects of Articles 5
and 6 to the detriment of the consumer, for instance if the
goods sold are faulty.
16
This agreement is only valid if “at the
time of the conclusion of the contract, the consumer knew
of the specific condition of the goods and the consumer has
expressly accepted this specific condition when concluding
the contract” (Art. 4.3 OSD).
2.2. The consumer’s remedies for lack
of conformity with the contract
2.2.1. Hierarchy of the consumer’s remedies for lack of conformity
In relation to the consumer’s remedies for lack of conformity,
the Online Sales Directive fully harmonises the hierarchy
9. Recital 19 OSD.
10. J. Smits (2016, p. 9). For in-depth analysis of the conformity criteria of the goods with the contract in Spanish, see E. Arroyo Amayuelas
(2016, pp. 7-11).
11. “[…] which includes that where the seller shows a sample or a model to the consumer, the goods shall possess the quality of and correspond
to the description of this sample or model” [Art. 4.1.a) OSD].
12. J. Smits (2016, p. 9).
13. Recital 19 OSD.
14. Recital 20 OSD.
15. Recital 22 OSD.
16. J. Smits (2016, p. 9).
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of the consumer’s remedies for lack of conformity,
following the two-step remedy system laid down in the
Consumer Sales Directive 1999/44/EC. At present national
provisions transposing the latter are subject to minimum
harmonisation, so there is notable divergence in this
matter. Most Member States, such as Spain,
17
have come to
recogni se a hierarchy of remedies .18 However, a few Member
States grant consumers a free choice of remedies or add
some additional ones.
19
These differences a re considered
by the Online Sales Directive to constitute one of the main
inhibiting obstacles impeding the achievement of a Digital
Single Market.
20
Article 9 OSD lists the consumer’s remedies for lack of
conformity with the contract and fully harmonises the order
in which consumer is entitled to have the goods brought
into conformity by the seller:
a) As a first step, the consumer is entitled to choose
between repair and replacement of the goods (Art. 9.1
OSD), unless the option chosen cannot be achieved or
is unlawful or disproportionate compared to the other
option (Art. 11 OSD). The seller shall complete the repair
or replacement within a reasonable time and without
any significant inconvenience to the consumer (Art. 9.2
OSD). The nature of the goods and the purpose for which
the consumer required the goods have to be taken into
account in determining what constitutes reasonable time
(Art. 9.2 OSD).
b) As a second step, the consumer is entitled to a price
reduction or to terminate the contract, where the lack of
conformity is not or cannot be remedied through repair
or replacement (Art. 9.3 OSD). This article clarifies the
current Consumer Sales Directive 1999/44/EC, stipulating
that the consumer shall also be entitled to termination or
price reduction if “the seller has not completed repair and
replacement within a reasonable time” [Art. 9.3.b) OSD].
c) Another clarification introduced by the Online Sales
Directive in comparison with the Consumer Sales Directive
1999/44/EC is that the former expressly recognises
the consumer’s right “to withhold the payment of any
outstanding part of the price, until the seller has brought
the goods into conformity with the contract” (Art. OSD
9.4). Currently this right can be found in the national
laws of all Member States.
21
d)
However, the proposal fails to recognise “the consumer’s
right to immediately return the goods and to have their
payment reimbursed if the goods delivered are not in
conformity with the contrac t.” With some variations, this
right is currently regulated in six Member States (Greece,
Portugal, Ireland, the United Kingdom, Denmark and
Lithuania).
22
The eventual approval of the Online Sales
Directive would have as a consequence what amounts
to a reduction in consumer protection in those Member
States.
2.2.2. Introduction of the consumer’s right to terminate the
contract also in the case of minor defects
One important new feature introduced by the Online Sales
Directive, compared to the current position under the
Consumer Sales Directive 1999/44/EC, is recognition of
the consumer’s right to terminate the contract for minor
breach where repair or replacement are not possible or
have failed. The Consumer Sales Directive 1999/44/EC
excludes the consumer’s right to terminate the contract “if
the lack of conformity is minor” (Art. 3.6 CSD). According
17. See Arts. 118 and following of the Spanish Consumer Protection Act introduced by Royal Decree 1/2007, 16 November (BOE no. 287,
30.11.2007).
18. According to the explanatory memorandum OSD, p. 6, “20 Member States have followed this approach (Austria, Belgium, Bulgaria, Czech
Republic, Denmark, Estonia, Finland, Germany, Hungary, Italy, Latvia, Luxemburg, Malta, the Netherlands, Poland, Romania, Slovakia, Spain,
Sweden)”.
19. For instance, some Member States currently recognise “the right to reject non-conforming goods within a short deadline” (Explanatory
memorandum OSD, p. 6).
20. Recitals 5 and 26 OSD.
21. J. Smits (2016, p. 12).
22. The European Economic and Social Committee (2016, comment 4.2.5.7) has noted this point of criticism. H. Beale (2016a, p. 19) points
out that this right is recognised in the UK under the Consumer Rights Act 2015 (ss. 19 and 20), according to which the consumer has an
immediate “’short term right to reject’ the goods and terminate the contract without first having to seek repair or replacement and with
no deduction for use or decrease in value of the goods”.
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The Directive Proposals on Online Sales and Supply of Digital Content…
to the recitals of the Online Sales Directive: “this would
provide a strong incentive to remedy all cases of lack of
conformity at an early stage”.
23
Certainly, this rule would
reinforce the consumer’s right to terminate the contract
and lead to a higher level of consumer protection in
distance contracts.
24
2.2.3. Termination by notice and the legal consequences of
termination by the consumer
Concerning the right to terminate the contract, the Online
Sales Directive also clarifies that the exercise of this right
must be by way of notice to the seller given by any means
(Art. 13.1 OSD). Even though the Consumer Sales Directive
1999/44/EC does not have any provision on this matter, in
most Member States termination is currently exercised by
way of notice and in some EU jurisdictions must be by way
of a court order.
25
The proposed Directive also introduces new rules about
partial termination. In case of acquisition of multiple goods
in a single contract, if the lack of conformity affects only
some of the goods, the Directive specifies that, as a rule,
the termination must be partial, unless some goods were
an accessory to the main item which the consumer would
not have acquired without the main item (Art. 13.2 OSD).
26
As for the main effects of the termination, unlike the
Consumer Sales Directive 1999/44/EC, the Online Sales
Directive expressly regulates – in Art. 13.3 – the obligation
imposed on the parties to return what they have received:
on the one hand, the seller shall be obliged to refund the
price received from the consumer within a maximum period
of 14 days and on the other the consumer in turn shall
return the non-conforming goods, at the seller’s expense,
also within a maximum period of 14 days. Finally, Article
13.3.c) and d) stipulates that the consumer has an obligation
to pay for the decrease in value of the goods though this
is limited to those situations where the decrease arises
over and above normal use. The payment for decrease in
value shall not exceed the price paid for the goods. If the
return of the goods is impossible due to their destruction
or loss, the consumer should pay the monetary value of
the goods unless the destruction or loss is caused by the
lack of conformity.
27
2.2.4. Developments in time limits
The Online Sales Directive introduces the following important
developments with regard to time limits compared to the
current position under the Consumer Sales Directive
1999/44/EC. The Online Sales Directive:
a) Retains the two-year legal period during which the seller
can be held liable for the lack of conformity (Art. 14
OSD).
28
Alt ho ugh the Cons ume r Sa les Dir ect ive 199 9/44/
EC for its part also provides the same period (Art. 5.1
CSD),
29
currently national transposing legislation differs
in this point. Most Member States have established a
two-year period, but in some EU jurisdictions this period
is longer or even unlimited.
30
If accepted, the Online Sales
Directive would fully harmonise the two-year period
only for online sales and other distance sales of goods.
This change would not affect the Spanish legal system
which has implemented the two-year period.
31
However,
in some Member States the Online Sales Directive will
undoubtedly lead to a reduction in the existing level of
protection.
32
23. Recital 29 OSD.
24. J. Smits (2016, p. 13) and H. Beale (2016a, pp. 16-17).
25. H. Beale (2016a, p. 17).
26. Recital 29 OSD.
27. Recital 31 OSD.
28. See Art. 8 OSD, regarding the relevant time for establishing conformity with the contract.
29. E. Arroyo Amayuelas (2016, pp. 14-15) points out that now the two-year legal period is also applicable in case of non-conformity of second-
hand goods and for legal defects.
30. See Explanatory Memorandum OSD, which adds that in two other Member States (Ireland and the United Kingdom) “there is no specific
legal guarantee period, but consumer rights are limited by the prescription period” and recital 32 OSD.
31. Art. 123.1 Spanish Consumer Protection Act.
32. See European Economic and Social Committee (2016, comment 4.2.5.10), that points out that “the period should take into account the
existing guarantee periods in some Member States (Finland, Netherlands, Sweden and the United Kingdom) which take into account the
durability and built-in obsolescence of products”.
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The Directive Proposals on Online Sales and Supply of Digital Content…
b)
Extends the period of the presumption of non-conformity
of the goods to two years (Art. 8.3 OSD).
33
In effect, the
seller shall only be liable if the lack of conformity of the
goods with the contract existed at the time when the
consumer acquired physical possession over the goods
in question (Art. 8.1 OSD). During a certain period, the
burden of proof shifts to the seller, who has to prove
the absence of lack of conformity at that time. Under
the Consumer Sales Directive 1999/44/EC, the minimum
period of reversal of proof is six months (Art. 5.3 CSD).
This provision has been implemented differently by the
Member States: some have followed the minimum period
of the Directive, such as Spain,
34
whereas othe rs have
extended it. The Online Sales Directive fully harmonises
the two-year period of reversal of burden of proof, but
only for online sales and other distance sales of goods.
This rule will lead to a higher level of consumer protection
in distance contracts.
35
2.2.5 Elimination of the consumer’s duty to notify the lack of
conformity
Finally, the Online Sales Directive eliminates the optional
requirement, recognised under the Consumer Sales
Directive 1999/44/EC, to introduce or maintain the
consumer’s duty to notify the lack of conformity to the
seller within a certain periodma of time from its discovery.
Currently, some national legislation, transposing the
Consumer Sales Directive 1999/44/EC, contain such
provisions, as is the case with Article 123.5 of the Spanish
Consumer Act. The recitals to the Directive point out
that the elimination of this notice requirement for online
sales is justified particularly with regard to cross-border
transactions, where the consumer might very well not be
aware of this duty and could easily lose otherwise well-
substantiated claims where notification is delayed or
absent.
36
This rule effectively reinforces the consumer’s
rights and will lead to a higher level of consumer protection
in distance contracts.
37
3. Digital Content Directive:
the main differences in relation
to the Online Sales Directive
The D igital Content Directive also takes as its basis the
current Cons umer Sales Directive 1 999/44/EC, but in
addition it introduces new rules concerning contracts for the
supply of digital content. Some of the new rules have already
been mentioned in relation to the Online Sales Directive.
38
This section examines the specific rules on conformity and
remedies for lack of conformity that the Digital Content
Directive will introduce to deal with the problems that
consumers face in this kind of contracts and the justification
for their particular format.
3.1. Conformity criteria of digital content
with the contract
As with the Online Sales Directive, the Digital Content
Directive fully harmonises the conformity criteria of
digital content with the contract, applying a combination
of subjective and objective criteria (Art. 6 DCD). However,
the latter differs from the former in two aspects:
Firstly, the conformity provision includes special
requirements specifically relevant to the digital environment,
namely the functionality
39
and interoperability
40
of the
digital content, and other performance features, such as
accessibility, continuity and security.
41
33. Recital 32 OSD notes that “in order to ensure higher awareness of consumers and easier enforcement of the Union rules on consumer’s
rights in relation to non-conforming goods, this Directive should align the period of time during which the burden of proof is reversed in
favour with the period during which the seller is held liable for any lack of conformity”.
34. Art. 123.1 Spanish Consumer Protection Act.
35. J. Smits (2016, p. 10).
36. Recital 25 OSD.
37. J. Smits (2016, pp. 15-16).
38. H. Beale (2016a, p. 17).
39. “Functionality” refers to the ways in which digital content can be used including “the absence or presence of any technical restrictions”
(Recital 26 DCD).
40. “Interoperability” refers to “the ability of digital content to perform all its functionalities in interaction with” the consumer’s hardware and
software (Art. 2.9 DCD).
41. R. Man
’ko (2016, p. 5); H. Beale (2016a, p. 20).
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Secondly, whereas under the Online Sales Directive the
subjective and objective criteria are cumulative, in contrast
under the Digital Content Directive the contractual terms
take precedence over the objective criteria .
42
In other words,
the digital content:
a) Must primarily conform to what was promised in the
contract.
In particular, according to Article 6.1 DCD, the contractual
requirements might refer to “quantity, quality, duration and
version and […] functionality, interoperability and other
performance features such as accessibility, continuity, and
security […]” [Art. 6.1.a) DCD]. Additionally, digital content
must be fit for “any particular purpose for which the consumer
requires it and which the consumer made known to the supplier
at the time of the conclusion of the contract and which the
supplier accepted” [Art. 6.1.b) DCD]. And, when the contract
so stipulates, digital content must “be supplied along with any
instructions and customer assistance” [Art. 6.1.c) DCD] and “be
updated” [Art. 6.1.d) DCD].
b) Only in the absence of clear benchmarks in the contract
must the conformity of the digital content be assessed
according to objective criterion. That is to say, it must be
fit for the purposes for which digital content of the same
description would normally be used.
43
Including, according to Article 6.2 DCD: “[…] its functionality,
interoperability and other performance features such as
accessibility, continuity and security, taking into account: a)
whether the digital content is supplied in exchange for a price
or counter-performance other than money; b) any existing
international technical standards or, in the absence of such
technical standards, applicable industry codes of conduct and
good practices;
44
and c) any public statement made by or on
behalf of the supplier or other persons in earlier links of the
chain of transactions” (Art. 6.2 DCD).
The Digital Content Directive recitals justify this rule on
the basis that it is necessary “to promote innovation in
the Digital Single Market and cater for technological
developments reflected in the fast changing characteristics
of digital content”.
45
However, this rule has been the subject
of much criticism because it would effectively weaken the
protection available to the consumer.
Such a rule may imply that suppliers of digital content could
impose on consumers very weak conformity requirements in
the contract, generally under standard terms and conditions,
in order to avoid liability for non-conformity. Besides, this rule
places the onus on consumers to carefully read the contract
terms. However, empirical studies show that consumers do
not read the contract terms, and even if they read them, it is
very unlikely that, due to the complexity of digital content,
the average consumer would fully understand the legal
and technological terms used in the contract. For these
reasons, it is my considered view that the Digital Content
Directive should follow the Online Sales Directive on this
point, thereby re-establishing the right balance between
consumer’s and supplier’s interests.
46
c) In addition, and in any case, in order to conform with the
contract, the digital content must meet two additional
requirements (Arts. 7 and 8 DCD). Firstly, the digital
content must be properly integrated in the consumer’s
hardware or software. Incorrect integration will be
considered a lack of conformity if the reasons for the
incorrect integration come under the scope of the
supplier’s responsibility (Art. 7 DCD). Secondly, as well
as in the Online Sales Directive, likewise in the Digital
Content Directive conformity covers not only material
defects, but also legal defects. The latter being especially
important for digital content, which by its very nature is
subject to intellectual property rights.
d) Finally, the Digital Content Directive contains two
clarifications: firstly, where according to the contract the
42. V. Mak (2016, p. 15); H. Beale (2016a, pp. 20-21).
43. Recital 25 DCD.
44. Recital 28 DCD points out that “the Commission may consider the promotion of the development of international and European standards
and the drawing up of a code of conduct by trade associations and other representative organisations that could support the uniform
implementation of the Directive”.
45. Recital 24 DCD.
46. This viewpoint has been put forward by the Council of the European Union (2016, p. 10), the European Law Institute (2016, pp. 18-19) and
the most prominent scholars: see H. Beale (2016a, p. 21), V. Mak (2016, p. 15) and S. Cámara Lapuente (2016, pp. 28-30).
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digital content shall be supplied over a period of time (for
instance in cases involving access to cloud services over a
period of time), the digital content must be in conformity
with the contract throughout the duration of the contract
(Art. 6.3 DCD)
47
. Secondly, unless the parties have agreed
otherwise, the supplier must provide “the most recent
version of the digital content which was available at the
time of the conclusion of the contract” (Art. 6.4 DCD).
3.2. Consumer remedies for failure to supply and
for lack of conformity of the digital content
3.2.1. The consumer’s remedy of immediate termination for
failure to supply
Unless otherwise agreed, the supplier must supply the digital
content “immediately after the conclusion of the contract”
(Art. 5.2 DCD). Unlike the Online Sales Directive, the Digital
Content Directive expressly sets forth the supplier’s liability
when that party has failed to supply the digital content on
time (Art. 10 DCD).
48
In this case the consumer is entitled
to terminate the contract immediately (Art. 11 DCD) and to
claim for damages (Art. 14 DCD).
49
The failure of the supplier to supply the digital content is a
serious breach of its main contractual obligations that might
well justify the termination of the contract in most cases.
However, as the European Law Institute Statement on the
proposed Directive has pointed out, this remedy might not
be appropriate if the digital content has been developed
according to the consumer’s specifications, irrespective of
the reasons for the delay.
50
3.2.2. The hierarchy of consumer remedies for lack of conformity
As regards the consumer’s remedies for lack of conformity,
the Digital Content Directive follows the two-step remedy
system laid down in the Online Sales Directive (Art. 12
DCD). However, it introduces some variations that take into
account the specific features of digital content.
a)
As a first step, the consumer is entitled to have the digital
content brought into conformi ty with the contract within a
reasonable time, without any significant inconvenience to
the consumer and free of charge, unless this is impossible,
disproportionate or unlawful (Art. 12.1 DCD). Unlike the
Online Sales Directive, the Digital Content Directive
does not refer to repair or replacement and gives the
supplier the right to select the specific way in which the
digital content is to be brought into conformity with the
contract, depending on its technical characteristics.
51
As
Prof. Vanessa Mak suggests, this rule makes sense, since
the large variety of possible formats of digital content
makes it more difficult to distinguish between the sub-
forms of bringing the digital content into conformity with
the contract. For instance, a movie file might be replaced,
but repairing it is harder to imagine.
52
b) As a second step, the consumer is entitled to a price
reduction or to terminate the contract where the digital
content is not or cannot be bought into conformity with
the contract (Art. 12.2 DCD). The remedy of a proportional
price reduction is only available if the digital content was
supplied in exchange for payment of a price (Art. 12.3 DCD).
c) Nonetheless, the Digital Content Directive does not
recognise the consumer’s right to withhold the payment
of the price until the supplier has brought the digital
content into conformity with the contract. This rule, as
laid down in the Online Sales Directive, should also be
recognised for the supply of digital content, mainly in
cases where the digital content is supplied over a period
of time in exchange for payment of a price.
53
3.2.3. The consumer’s right to damages
In any case, the Digital Content Directive establishes the
consumer’s right to seek compensation for any economic
damage cau sed by a lack of conformity or the failure to
supply (Art. 14 DCD). The detailed conditions for the exercise
47. Recital 29 DCD.
48. H. Beale (2016a, p. 22).
49. Recital 35 DCD clarifies that in long-term contracts, if the supply of the digital content is interrupted, but only over a short period of time,
remedies for non-conformity with the contract should apply.
50. European Law Institute (2016, p. 5).
51. Recital 36 DCD.
52. V. Mak (2016, p. 24).
53. European Law Institute (2016, p. 6).
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of the right to damages are up to the Member States
themselves (Art. 14.2 DCD). The provision on damages is
remarkable for two reasons.
a) Firstly, because it establishes rules with regard to the
remedy of damages when as a general rule consumer
law Directives do not provide for this remedy, whose
regulation is left to national laws.
54
For instance, the
Online Sales Directive leaves the provisions on the
consumer’s right to receive compensation for damages
due to lack of conformity entirely up to the Member
States’ domestic legislation (Art. 1.4 OSD).
b)
Furthermore, and more importantly, because the provision
on damages in the Directive limits the right to damages
to those incurred in the consume r’s digital environment
55
(Art. 14.1 DCD). The interpretation of this provision raises
serious doubts due to the full harmonisation approach of
the Directive. Does this rule prevent Member States from
enacting or maintaining rules on the right to damages
that provided compensation for other kinds of loss, such
as damages to other property, personal injuries and pain
and suffering?; for instance, if the consumer is injured in
an accident due to a defective navigation cloud service, is
he or she entitled to claim for the compensation for those
injuries?;
56
Or are the damages to the digital consumer’s
hardware and digital content the only ones that can be
compensated?
Limiting the consumer’s right to damages weakens his or
her protection. For this reason, it may be argued that the
most appropriate interpretation would be the one that
does not affect the ability of Member States to enact or
maintain rules on the right to damages under their own
national laws.
57
And more importantly because this “right
[…] must already exist in one form or another in almost
every Member State”.
58
Consequently, the Directive
should clarify that claims for damages under national
law are not in any way curtailed or limited.
59
3.2.4. Exclusion of the consumer’s right to terminate the contract
for minor defects
In contrast to the Online Sales Directive, the Digital
Content Directive does not recognise the consumer’s right
to terminate the contract for minor defects. Instead, the
right to terminate the contract is limited to those cases
where bringing the digital content to conformity is not
possible or has failed and the non-conformity impairs the
main performance features of the digital content.
60
They
comprise – pursuant to Article 12.5 DCD – its: “functionality,
interoperability and other main performance features […]
such as its accessibility, continuity and security.” In such
instance the burden of proof is on the supplier (Art. 12.5 DCD).
3.2.5. Legal consequences of termination by the consumer
With regard to the legal consequences arising f rom the
termination of the contract, the Digital Content Directive
lays down specific rules that regulate the restitutionary
effects taking into account the special features of the
digital content in the contract; thus some digital content
cannot be returned (for instance, a movie downloaded from
internet), nor can counter-performance other than money.61
The proposed Directive imposes on the parties the following
duties upon termination:
a) With respect to the supplier, it must reimburse the price
within a maximum period of 14 days [Art. 13.2.a) DCD]
or if the counter-performance consisted of data, the
supplier must refrain from using it [Art. 13.2.b) DCD].
62
Additionally, the supplier should ensure the exportability
of the data provided by the consumer and any data
54. V. Mak (2016, p. 27).
55. “Digital environment” means, according to Art. 2.8 DCD, “hardware, digital content and any network connection to the extent that they
are within the control of the user”.
56. European Law Institute (2016, p. 32).
57. V. Mak (2016, p. 28).
58. H. Beale (2016a, p. 24).
59. In this vein see Council of the European Union (2016, p. 9) and European Law Institute (2016, p. 6).
60. Recital 37 DCD.
61. V. Mak (2016, p. 25).
62. This means, according to Recital 37 DCD, that “the supplier should take all measures in order to comply with data protection rules by
deleting it or rendering it anonymous in such a way that the consumer cannot be identified by any means likely reasonably to be used
either by the supplier or by any other person”.
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produced or generated through the consumer’s use of
the digital content.
63
b) In relation to the consumer, he or she shall agree
to refrain from using the digital content following
termination by deleting the digital content or rendering
it otherwise unintelligible [Art. 13.2.d) and e) DCD]. If the
digital content was supplied on a durable medium, upon
the request of the supplier the consumer shall return
the durable medium at the supplier’s expense within a
maximum period of 14 days [Arts. 13.2. d) and e) DCD].
3.2.6. Lack of time limits with regard to the supplier’s liability for
non-conformity and for the reversal of the burden of proof
Finally, also worthy of note are the lack of time limits for the
supplier’s liability for non-conformity of the digital content
and for the reversal of burden of proof:
a) Unlike the Online Sales Directive, the Digital Content
Directive does not provide for a period during which the
supplier shall be held liable for any lack of conformity
that exists at the time of the supply of the digital content.
The justification of this being that digital content is not
subject to wear and tear and is often supplied over a
period of time.
64
Nevertheless, claims based on the lack
of conformity of digital content might be limited under
the relevant Statute of Limitations periods as laid down
in the domestic law of each Member State.
b) Concerning the presumption of the pre-existence of
the lack of conformity, the Digital Content Directive
imposes the burden of proof for the absence of a lack
of conformity on the su pplier, without subjecting it to
any time limit (Art. 9.1 DCD). The Directive takes into
consideration that the supplier is in a better position
than the consumer to know the reasons for the lack
of conformity given the specific and highly complex
nature of digital content.
65
Exceptionally, the burden of
proof of the pre-existence of the lack of conformity lies
with the consumer, namely when the consumer’s digital
environment is not compatible with interoperability and
other technical requirements of the digital content and
where the supplier had previously informed the consumer
of such requirements (Art. 9.2 DCD).
The lack of time limits governing the supplier’s liability has
been criticised. It has been suggested that although at first
this rule might seem to be in interest of consumers, it might
in practice end up effectively restricting the utility of the
Directive for them. Member States can limit claims based
on lack of conformity of digital content by establishing very
short limitation periods. Besides, the existence of different
limitation periods within Member States would create a
barrier to cross-border trade which goes entirely against the
stated purpose of the Directive. Therefore, it would appear
highly advisable to modify the proposal on this point and set
down a minimum limitation period governing the supplier’s
liability for lack of conformity.
66
4. Conclusions
The main findings of the second part of this article are the
following:
a)
The Online Sales Directive introduces some improvements
and clarifications to the Consumer Sales Directive that
will either increase or maintain the current level of
protection in most Member States:
—
It fully harmonises the conformity criteria of the goods
and the hierarchy of the consumer’s remedies for lack
of conformity;
—
It expressly recognises the consumer’s right to withhold
payment for any outstanding part of the price;
— It introduces the consumer’s right to terminate the
contract also in the case of minor defects and clarifies some
rules regarding the consequences of such termination;
— The period of the presumption of non-conformity is
extended to two years; and
63. “The consumer shall be entitled to retrieve the content free of charge, without significant inconvenience, in reasonable time and in a
commonly used data format” [Art. 13.2.c) DCD].
64. Recital 43 DCD.
65. Recital 32 DCD.
66. In this vein, see European Law Institute (2016, p. 33), V. Mak (2016, pp. 19 and 28) and S. Cámara Lapuente (2016, pp. 44-47).
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— The option to introduce the consumer’s duty to notify
the lack of conformity within a certain period of time
from its discovery has been eliminated.
b) Nevertheless, in some Member States the Online Sales
Directive will undoubtedly lead to a reduction in the
existing level of protection, mainly because the proposal
fails to recognise the right to immediately terminate
the contract without first having to seek repair and
replacement, and because it fully harmonises the two-
year legal period during which the seller can be held
liable for the lack of conformity.
c)
The Digital Content Directive rules on conformity and the
remedies for failure to supply and for lack of conformity
of the digital content also raise some significant issues:
—
The rule according to which the contractual terms take
precedence over the objective criteria when assessing
the conformity of the digital content needs to be
reconsidered. Such a rule would weaken consumer
protection as it may well end up allowing suppliers
of digital content to impose very weak contractual
conformity requirements on consumers;
—
The consumer’s right to withhold payment of the price
until the supplier has brought the digital content into
conformity with the contract needs to be recognised,
in line with the Online Sales Directive;
— It should be clarified that claims for damages under
national laws are not limited to damages in the digital
consumer’s environment; and
— Finally, it would be highly advisable to lay down a
minimum limitation period for the supplier’s liability
for lack of conformity in order to avoid very short
limitati on of action periods which will be to the
detriment of consumers and to avoid creating barriers
to cross-border trade.
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Recommended citation
MILÀ RAFEL, Rosa (2016). “The Directive Proposals on Online Sales and Supply of Digital Content (Part
II): conformity and remedies for lack of conformity”. IDP. Revista de Internet, Derecho y Política. No. 24,
pp. 50-63. UOC [Accessed: dd/mm/yy]
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About the author
Rosa Milà Rafel
rosa.mila@uclm.es
Juan de la Cierva-Incorporación Researcher
Civil Law and Private International Law Department
Universidad de Castilla-La Mancha
Facultad de Ciencias Jurídicas y Sociales de Toledo
Cobertizo de San Pedro Mártir, s/n
45071 Toledo
