On 28 May 2022, the new Consumer Protection Act (Official Gazette No. 19/2022, hereinafter: the “Act”) enters into force. The reason behind this legislative initiative is the obligation to implement the Directive (EU) 2019/2161 of the European Parliament and of the Council of 27 November 2019 amending Council Directive 93/13/EEC and Directives 98/6/EC, 2005/29/EC and 2011/83/EU of the European Parliament and of the Council as regards the better enforcement and modernisation of Union consumer protection rules (hereinafter: the “EU Directive”) into the domestic legal order. Main objective of this EU Directive is to meet the challenges of modern times and adapt the consumer protection rules to consumer habits of an average citizen who is increasingly oriented towards buying products or services online, especially during the Covid-19 pandemic. On the other hand, stricter fines seek to dissuade traders from non-compliance with legal provisions and, inter alia, to harmonize the level of protection enjoyed by consumers in different Member States.
Even though it is a completely new act, basic determinants and mechanisms of consumer protection have not changed significantly. However, the legislator, taught by previous experiences, supplemented, upgraded and adapted the rules to new circumstances, in order to adequately respond to shortcomings previous legislation displayed in its enforcement.
In addition to the current possibilities of filing a complaint, i.e. in person at the business premises, by mail and e-mail, the trader is given the right (not the obligation) to allow the consumer to submit a written objection through the means of network communication. Since traders have often responded insufficiently to the consumer’s objection, it is mandatory now for the trader to expressly state whether he accepts the objection as founded or not.
In any form of price reduction (special sale, final sale, seasonal discount, sale of defective goods, etc.), the trader is obliged to state the lowest price applied by the trader during period of 30 days prior to the application of the price reduction. When selling defective goods, in addition to the indication of the defective goods, the trader is obliged to indicate what the defect consists of.
Unfair business practices
From now on, the following, among other things, is considered as unfair (misleading) business practice:
- placing goods on the Croatian market claiming that they are identical to the goods on the markets of other Member States, although in reality they differ in composition or characteristics, with certain prescribed exceptions;
- failure of the trader to provide general information on the product ranking parameters displayed to the consumer as a result of a query in the form of a keyword, phrase or other online query;
- failure to clearly disclose any paid advertising or payments specifically for achieving higher ranking of products within the search results;
- providing product reviews given by consumers who have used or purchased the product without prior verification that those reviews originate from consumers who have used or purchased the product;
- submitting false consumer reviews or recommendations, or ordering another legal or natural person to submit them, or misrepresenting consumer reviews or recommendations to promote a product;
- resale of tickets for various events to consumers (concerts, exhibitions and similar events) acquired by using automated means to excess the limit on the number of tickets available for purchase to every individual.
Public services provided to consumers
The list of public services is supplemented by the service of parking in public areas and garages. The legislator specified the permitted ways of submitting a complaint – in person at the trader’s business premises, by mail and e-mail, and expressly prescribed the trader’s duty to clearly, visibly and legibly display information on the permitted ways of submitting a complaint in his business premises and/or website.
Concluding off-premises and distance sales contracts
Provider of the online marketplace is obliged to inform consumers whether or not a third party offering goods, services or digital content is a trader, and if not a trader, to inform the consumer that the consumer protection rules do not apply to the contract.
Prescribing obligations of the trader who organizes events to sell or promote products, in addition to the obligation to inform consumers about the purpose of the event and the conditions of participation, the legislator obliges the trader to deliver such invitation to the consumer on paper or, with his consent, on another durable medium. Unsolicited visits to the consumer’s home are also explicitly regulated and the trader can now carry these out on weekdays from 8 a.m. to 8 p.m. whereas the consumer has the right to point out an additional time limit for the visit.
The consumer has the right to terminate the sale contract without leaving a subsequent reasonable period for fulfilment if it is obvious that the trader is unable to fulfil his obligations within such period.
Inspection and misdemeanour liability
Inspectors are now, among other things, expressly authorized to conduct purchases under secret identity. The range of fines has also been expanded, and the possibility of imposing a fine as a percentage of the total annual turnover for cross-border violations of the collective interests of consumers has been envisaged.
In conclusion, by harmonizing the rules of the domestic legal order with European legislation, the legislator undoubtedly raised the level of consumer protection in Croatia. On the other hand, by postponing enforcement of the Act for May 28, 2022, the legislator left a certain period to all addressees, especially traders, to harmonize their activities with new obligations.