EU court ruling mandates clearer payment obligations for online orders
Consumers may soon receive better protection. According to a ruling by the Court of Justice of the European Union (CJEU) on Thursday, when clicking the order button online, the consumer must be clearly informed if they are simultaneously committing to making a payment, such as for a service.
The issue arose from a case in Germany, where a tenant realized that their monthly rent exceeded the allowable limits under national regulations.
This tenant then contacted a debt collection agency to recover the excess rent paid to the landlords. The tenant agreed to the general terms and conditions before clicking the order button on the debt collector's website. However, they did not notice that, according to the contract terms, by clicking on the order, they committed to giving the debt collector one-third of the overpaid annual rent if the firm managed to recover their money.
CJEU announced its judgement: consumers better protected
The landlords litigating with the debt collector referred the case to the court, indicating that the order button was not marked with words like "order with obligation to pay" or similar, as required by the EU consumer rights directive. The German court referred the matter to the CJEU.
On Thursday, the court ruled that under EU regulations, the business should inform the consumer before placing an order online that by doing so, they undertake an obligation to pay.
CJEU indicated the obligation
The requirement to inform the customer rests with the business regardless of whether the obligation to pay is unconditional or dependent on additional circumstances (in the discussed case, on successfully recovering the overpaid rent).
According to the CJEU, if the company did not fulfill the information obligation, the consumer is not bound by the contract or order. However, they still retain the option to confirm the order.
