New duties of business enterprises to provide information to resolve disputes with consumers

As early as in February 2016, the German “Act on Alternative Dispute Resolution in Consumer Matters” [Verbraucherstreitbeilegungsgesetz - VSBG] implemented into national law the Community “ADR Directive” (Directive 2013/11/EU). Sections 36 and 37 of the VSBG provide for comprehensive duties of business enterprises to provide information, which duties must be implemented. Otherwise, there will be a threat of warnings from competitors and consumer protection organisations, including the related costs and difficulties.

1. Who is required to comply with the duties to provide information?

The duties to provide information apply to all business enterprises which

• operate a website, or
• use general terms and conditions of Business.

Thereby, the duties do not only affect merely the online or distance selling sector. While there is no explicit limitation to the B2C sector, the duty to provide information exists only “as against consumers” within the meaning of section 13 German Civil Code.

Only business enterprises providing of at least 11 employees on December 31st of the former year will need to comply with the general duties under Section 36 of the VSBG. However, all business enterprises will need to comply with the duties to provide information after a dispute with a consumer arose (see Section 37 of the VSBG and Section 7 of this Article).

2. From when must the duties to provide information be complied with?

The duties to provide information must be complied with from 1 February 2017.

3. Where must the information be provided?

The information must be provided on the website, as well as in the general terms and conditions of business, of the business enterprise.

4. How must the information be provided?

The information must be easily accessible for the consumer, clear and understandable. Therefore, one should take care to ensure that a separate section is added to the general terms and conditions of business for the information under the VSBG. On a website, it is advisable to add the information in the legal notice.

5. Are business enterprises obliged to participate in a dispute resolution procedure?

No. Basically, a business enterprise will be free to opt whether or not it is willing to participate in a dispute resolution procedure. If a business enterprise, however, opts against a participation in a dispute resolution procedure, it must disclose this on the website or in its general terms and conditions of business, respectively.

6. What information must business enterprises include?

The answer to that question depends on the respective decision and the situation of the business enterprise. The following four possibilities exist:

6.1. The business enterprise does not wish to participate in a dispute resolution procedure.

That information must then be stated on the website, preferably in the legal notice, as well as in the general terms and conditions of business.

6.2. The business enterprise is willing to participate in a consumer conciliation procedure.

In such case, this must also be stated in accordance with section 6.1 above.

6.3. The business enterprise wishes to participate in a consumer conciliation procedure but
wishes to limit this to a specific dispute resolution body.

In such case, the information must be provided in accordance with section 2, and the name of the conciliation body, including the address and website, must also be stated. A list of German consumer conciliation bodies can be retrieved at

https://www.bundesjustizamt.de/DE/SharedDocs/Publikationen/Verbraucherschutz/Liste_Verbraucherschlichtungsstellen.pdf?__blob=publicationFile&v=23.

A list for all EU countries can be retrieved at:

https://webgate.ec.europa.eu/odr/main/?event=main.adr.show.

6.4. Owing to the affiliation with a specific association, or a contractual duty, the Business
enterprise is obliged to settle disputes through a specified consumer conciliation body.

In such case, this must be stated in the general terms and conditions of business and on the website.

7. What duties do business enterprises have after the occurrence of a dispute?

In addition to the general duties to provide information set out above, business enterprises must refer to their willingness to participate in a dispute resolution procedure to the extent that the business enterprise had been unable to settle the dispute with a consumer out of court. The information also depends on the decision on the dispute resolution taken by the business enterprise, see the answers in sections 6.1 to 6.4 above.

CONCLUSION:

Business enterprises should think about the handling of an extrajudicial settlement of disputes through consumer conciliation bodies at an early stage and enter such information in a timely manner on their website and in their general terms and conditions of business.

Contact Person

Dr. Karolin Nelles, LL.M., lawyer, Hanover (Germany)