Commission Revises EU Rules on Product Safety and Consumer Credit

Věra Jourová, vice president for Values and Transparency, says, “Consumers face many challenges, especially in the digital world which revolutionised shopping, services, or financial markets. This is why we are stepping up consumer protection on two fronts: we are making it easier for consumers to avoid risks related to having credit and we are putting even stronger rules for product safety in place. It will also put more responsibility on market players and make it more difficult for bad actors to hide behind complicated legal jargon.”

According to Commissioner for Justice Didier Reynders, “The COVID-19 crisis has impacted consumers in multiple ways, and many have faced financial difficulties. The digitalisation that has been accelerated by the pandemic leads to a surge of online shopping and is profoundly changing the financial sector. It is our duty to safeguard consumers, in particularly the most vulnerable ones. That’s exactly what we do with our revision of the existing EU rules on consumer credit and general product safety.”

Online sales have increased steadily in the past 20 years — and in 2020, 71% of consumers shopped online, often buying new technology products. From wireless earplugs and air purifiers to gaming consoles — the market for technological gadgets is vast. The General Product Safety Regulation will address risks related to these new technology products (such as cybersecurity risks) as well as online shopping by introducing product safety rules for online marketplaces. It will ensure that all products reaching EU consumers — either through online marketplaces or from the neighbourhood shop — are safe, whether they come from within or outside the EU. The new regulation will make sure marketplaces fulfil their duties so consumers will not receive dangerous products.

The revision of the Consumer Credit Directive provides that information related to credits must be presented in a clear way, adapted to digital devices so consumers understand what they are signing up for. Furthermore, the directive will improve rules that will be used to assess a consumer’s creditworthiness — i.e. whether or not they will be able to repay the credit. The aim is to avoid the issue of over-indebtedness. The regulation will ask member states to promote financial education and ensure debt advice is made available to consumers.

Next steps

The Commission's proposals will now be discussed by Council and Parliament.

General Product Safety Regulation: background information

The General Product Safety Directive — in force since 2001 — ensures that only safe products are sold on the EU single market. However, too many unsafe products still circulate on the EU market, creating an uneven playing field for businesses and an important cost for society and consumers. In addition, the rules should be updated to address challenges linked to new technologies and online sales.

Consumer Credit Directive Proposal

Directive 2008/48/EC on credit agreements for consumers established a harmonised EU framework for consumer credit and provided a solid framework for fair access to credit for European consumers. However, since its entering into force in 2008, digitalisation has profoundly changed the decision-making process and the habits of consumers in general. The current revision aims to address these developments.

Both proposals are part of the New Consumer Agenda that was launched last year, aiming to update the overall strategic framework of the EU consumer policy.