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Legal Certainty beyond the UCP Directive: The Relationship between the Directive and Other Instruments of EU Law

In light of its broad scope, it is inevitable that the UCP Directive attempts to define how it interacts with other provisions of EU law. In order to address this question, it is necessary to assess the matter from two distinct perspectives. The first relates to the more specific provisions that have been adopted to add some flesh to the bones of the notions of 'unfair', 'misleading' and 'aggressive' practices. The second concerns the relationship between the UCP Directive and other instruments of EU law which are not intended to complement per se the unfairness test but which nonetheless interact with the UCP Directive.

Fleshing out the Provisions of the UCP Directive: From Horizontal to Sectoral Provisions

The UCP Directive is a framework directive which applies in the absence of more specific provisions: 'In the case of conflict between the provisions of this Directive and other Community rules regulating specific aspects of unfair commercial practices, the latter shall prevail and apply to those specific aspects.[1]

The reference to more specific provisions acknowledges that the definition of broad concepts such as misleading, aggressive and unfair may have to be fleshed out in relation to certain categories of goods/services or certain commercial practice. Thus, the Directive must be read in light of more specific provisions which have been introduced to further improve legal certainty.

As the Commission explained in its First Application Report:

The Directive is the general law governing unfair commercial practices in business-to-consumer transactions. [...] Where sectoral legislation conflicts with the Directive's general provisions, the corresponding provisions of the lex specialis will prevail. Often, such conflict occurs because the lex specialis contains more detailed pre-contractual information requirements, or stricter rules on the way information is presented to consumers (see Recital 10 of the Directive). However, the existence of specific EU rules in a given sector does not exclude the application of the Directive: in these cases and in relation to all the aspects not covered by the lex specialis, the UCP Directive complements these sectoral provisions and fills any remaining gaps in the protection of consumers against unfair commercial practices.[2]

In light of the importance that it attaches to consumer information as a tool of consumer protection, the European Union has adopted a broad range of sectoral measures on information disclosure. Commercial transactions are generally seen as fair if consumers have sufficient, clear and transparent information at their disposal. It is then up to them to process this information and make the most appropriate consumption choices for them and their families.

Examples abound. One of them is Regulation (EC) 1008/2008 on the operation of air services in the European Union.[3] It increases legal certainty regarding what constitutes a misleading price indication in that it requires that air carriers indicate the final price to consumers and provide a breakdown of this price:

The final price to be paid shall at all times be indicated and shall include the applicable air fare or air rate as well as all applicable taxes, and charges, surcharges and fees which are unavoidable and foreseeable at the time of publication. In addition to the indication of the final price, at least the following shall be specified:

(a) air fare or air rate;

(b) taxes;

(c) airport charges; and

(d) other charges, surcharges or fees, such as those related to security or fuel;

where the items listed under (b), (c) and (d) have been added to the air fare or air rate. Optional price supplements shall be communicated in a clear, transparent and unambiguous way at the start of any booking process and their acceptance by the customer shall be on an 'opt-in' basis.[4]

This provision does improve legal certainty in that it lays down clear, specific requirements on traders to enable consumers to understand more easily what they will have to pay to travel by air and thus compare prices more accurately.[5] The Court has further clarified its scope by holding that an 'optional price supplement' had to be interpreted as meaning that it covers costs, connected with the air travel, arising from services, such as the flight cancellation insurance at issue in the main proceedings, supplied by a party other than the air carrier and charged to the customer by the person selling that travel, together with the air fare, as part of a total price.[6] This provision is more specific regarding what the 'price' covers than the notion of 'price' in Article 7(4)(c) of the UCP Directive.[7] Even though the Air Services Regulation does not refer to the UCP Directive, the former will therefore supersede the latter in that it provides useful indication of what type of practice would be considered unfair across the European Union.[8] This is not to say, however, that the UCP Directive does not play an important role in relation to other potentially unfair commercial practices, such as bait advertising and marketing of air fares, which are not covered by Regulation (EC) 1008/2008.

Regrettably, however, provisions designed to apply to specific sectors do not always promote as much legal certainty as they should do. If this is somewhat counter-intuitive, the following example drawing on what would constitute misleading food information will attempt to demonstrate the point.

The principle that information should not be misleading is at the heart of EU food law,[9] and in the last few years, the European Union has invested a significant amount of energy to flesh out the notion of misleading food information. In particular, it has adopted Regulation (EC) 1924/2006 on nutrition and health claims made on foods which is intended to regulate the type of claims which food operators are entitled to use to promote their products,[10] as well as Regulation (EU) 1169/2011 on the provision of food information to consumers.[11]

Regulation (EC) 1924/2006 defines a claim as 'any message or representation, which is not mandatory under [Union] or national legislation, including pictorial, graphic or symbolic representation, in any form, which states, suggests or implies that a food has particular characteristics'.[12] The Regulation then divides food claims into two main sub-categories: nutrition claims and health claims. A nutrition claim 'suggests or implies that a food has particular nutrition properties due to the energy it provides (or does not provide) or the nutrients or other substances it contains or does not contain' (for example: 'low fat').[13] A health claim 'states, suggests or implies that a relationship exists between a food and health' (for example: 'reduces cholesterol').[14] As the definition clearly explains, claims are voluntarily provided by food operators and should therefore be distinguished from the information which must be disclosed as part of a legal requirement, such as the compulsory nutrition declaration provided for in Regulation (EU) 1169/2011.[15]

The increased reliance of consumers on nutrition and health claims may be seen as a positive evolution insofar as these claims can inform their purchasing decisions. It may also encourage food manufacturers to reformulate their products and place more nutritious foods on the market. It is therefore not surprising that the food industry has supported the harmonization of national rules on food claims at the EU level to reduce regulatory diversity and facilitate the free movement of food from one Member State to another. On the other hand, nutrition and health claims may also offer a powerful marketing tool to food industry operators. It is consequently imperative to ensure that the claims in question are reliable and do inform consumer choices rather than mislead them. Several public health and consumer associations have therefore supported the introduction at the EU level of the regulation of nutrition and health claims made on foods, on the ground that such claims aspire to be treated as objective truths capable of influencing the eating decisions of consumers and, ultimately, their health. This is particularly so as they are often made on branded foods which tend to be highly processed and as such contribute to unhealthy diets, overweight and obesity.

After more than three years of intense debate, the Council and the European Parliament adopted Regulation (EC) 1924/2006, which entered into force on 1 July 2007. It lays down the overriding principle that nutrition and health claims may only be used if they are not misleading[16] and if they are scientifically substantiated.[17] The European Food Safety Agency (EFSA) provides support to the Commission and assesses whether claims relating to the nutrition and health benefits of foods are substantiated by scientific evidence.[18] It is on the basis of this scientific evaluation that EU political institutions then decide whether or not such claims should be authorized at the EU level.

Nutrition claims are only permitted if they are listed in the Annex and if they respect precise and quantifiable values.[19] For example, a claim that a food is a 'source of fibre' may only be made 'where the product contains at least 3 grams of fibre per 100 grams or at least 1.5 grams of fibre per 100 kcal'.[20] The Commission may require that amendments to the Annex be made subject, where appropriate, to the consultation of the EFSA.[21] To date, five nutrition claims have been added to the original list of 24,[22] whereas two have been rejected.[23]

As far as health claims are concerned, a positive list of health claims other than those referring to the reduction of a disease risk will be drawn up by the Commission, on the basis of claims submitted by Member States. These health claims will then be allowed on labels, provided that the producer can verify the link between the claim and a given product. The EFSA is responsible for verifying the scientific substantiation of the submitted claims, some of which are currently in use, some of which are proposed by applicants.[24] The Commission has established an EU register of nutrition and health claims made on food which will be updated regularly to include the list of permitted nutrition and health claims together with the conditions applying to them, as well as a list of rejected health claims and the reasons for their rejection. A first list of health claims was published on 16 May 2012.[25] Overall, the amount of health claims the EFSA has had to assess has exceeded all expectations: out of the 4,637 claims (of a total of44,000 health claims Member States had proposed) the Commission submitted to the EFSA between July 2008 and March 2010, the Commission asked the EFSA to evaluate 2,758 claims by June 2011, 331 claims were withdrawn and 1,548 claims on 'botanicals' have been placed on hold by the Commission pending further consideration on how to proceed with these.

To this extent, there is no doubt that Regulation 1924/2006 has injected far more certainty regarding the claims made on foods than a horizontal, non-sector-specific text such as the UCP Directive could ever have done. However, seven years after its adoption, the framework that this Regulation lays down still contains glaring gaps which necessarily limit the effectiveness of this instrument and the certainty resulting from its provisions. It is all the more regrettable that these gaps could have been avoided with a bit more political courage from the Commission whose quest for uniformity and legal certainty has tended to give way before the opposition it has faced from the powerful food industry lobby. The question of nutrition profiling illustrates the point.

Article 4 of Regulation (EC) 1924/2006 provides that food must have appropriate nutrient profiles to bear nutrition or health claims.[26] The rationale for the establishment of nutrient profiles is that food containing high levels of nutrients whose excessive intakes as part of the overall diet is not recommended should not be able to be marketed as providing nutrition or health benefits if, ultimately, such consumption is not conducive to health. The EFSA was consulted and in preparing its scientific advice to the Commission, it concluded:

When classifying food products as eligible to bear claims, the potential of the food to adversely affect the overall dietary balance is the main scientific consideration. This consideration relates in particular to nutrients for which there is evidence of a dietary imbalance in EU populations that might influence the development of overweight and obesity or diet-related diseases such as cardiovascular disease or other disorders; they include nutrients that might be consumed to excess, as well as those for which intake might be inadequate.[27]

However, in setting the nutrient profiles, the Commission is also required to 'carry out consultations with interested parties, in particular food business operators and consumer groups'. Thus, the Commission has conducted specific and extensive consultations of stakeholders on the setting of nutrient profiles, including two meetings of a working group on nutrient profiles.[28] Member State experts were also consulted within the Commission expert working group on nutrition and health claims, in which the EFSA also participated. Nevertheless, nearly four years after the deadline laid down in Regulation (EC) 1924/2006, nutrient profiles still remain to be published. The difficulties facing the Commission largely stem from the fact that the boundary between the scientific sphere and the policy decision sphere is particularly difficult to draw in this area.[29] Hopefully the next Commission has more political stamina than the current one and can reconcile sweeping statements on legal certainty (and the use of maximum harmonization and regulations to promote such certainty) with practical reality.

This example demonstrates that, even if some significant progress has been made to increase legal certainty, the Commission's rhetoric on uniformity fails to convince. Whilst the elephant remains in the room (in the absence, for example, of a robust nutrition profiling system), legal certainty will not improve as much as it should nor as much as the Commission promised when it proposed the Nutrition and Health Claims Regulation back in 2003. The intention of the European Union to regulate misleading claims is laudable, but in practice, these efforts will not deliver the promised outcomes until difficult decisions are made to confront the relevant industry lobbies at the EU level.

  • [1] Art 3(4).
  • [2] At p. 5. The use of the word 'conflicts' is not representative of the situation: very often, rules do not conflict as such, in the sense that one goes against another; rather sectoral rules complement the general clauses.
  • [3] [2008] OJ L 293/3. This directive complements Regulation (EC) 261/2004 on air passengers' rights in the event of denied boarding and of cancellation or long delay of flights [2004] OJ L 46/1.
  • [4] Art 23(1). Paragraphs 18 and 19 of art 2 define 'air fare' and 'air rate' respectively.
  • [5] Recital 16 of Regulation (EC) 1008/2008.
  • [6] Case C-112/11 ebookers.com Deutschland, judgment of 19 July 2012.
  • [7] 'In the case of an invitation to purchase, the following information shall be regarded as material, if not already apparent from the context: [...] (c) the price inclusive of taxes, or where the nature of the product means that the price cannot reasonably be calculated in advance, the manner in which the price is calculated, as well as, where appropriate, all additional freight, delivery or postal charges or, where these charges cannot be reasonably be calculated in advance, the fact that such additional charges may be payable [...].'
  • [8] The First Application Report explicitly refers to Regulation (EC) 1008/2008 to illustrate the relationship between the UCP Directive and EU sectoral legislation. See (n 1) 5, fn 21.
  • [9] M Friant-Perrot and A Garde, 'From BSE to Obesity - EFSA's Growing Role in the EU's Nutrition Policy', in A Alemanno and S Gabbi (eds), Foundations of EU Food Law and Policy - 10 Years of European Food Safety Authority (Ashgate, 2014).
  • [10] [2007] OJ L 12/3.
  • [11] [2011] OJ L 304/18. Art 7 specifically defines what constitutes misleading food information.
  • [12] Art 2(2).
  • [13] Art 2(4).
  • [14] Art 2(5).
  • [15] [2011] OJ L 304/18. See in particular the mandatory nutrition declaration provided for in art 9(l) and art 29 to 35.
  • [16] Arts 3, 4 and 5.
  • [17] Art 6.
  • [18] See Regulation (EC) 1924/2006 read in light of Regulation (EC) 178/2002 laying down the general principles and requirements of food law, establishing the European Food Safety Authority and laying down procedures in matters of food safety [2002] OJ L 31/1: '[The EFSA] shall provide scientific advice and scientific and technical support for the Community's legislation and policies in all fields which have a direct or indirect impact on food and feed safety. It shall provide independent information on all matters within these fields and communicate on risks' (art 22[2]).
  • [19] Art 8(1).
  • [20] Annex to Regulation (EC) 1924/2006.
  • [21] Arts 8(2) and 25, which refer to Council Decision 1999/468/EC laying down the procedures for the exercise of implementing powers conferred on the Commission [1999] OJ L 184/23.
  • [22] Commission Regulation (EU) 116/2010 [2010] OJ L 37/10.
  • [23] These two rejections resulted from the objection of the European Parliament on 2 February 2012: P7_TA(2012)0022).
  • [24] Four types of health claims are identified in Regulation (EC) 1924/2006: general function claims; new function claims; disease reduction claims; and child development or health claims. For more information on each type of claims, see arts 13 and 14 of the Regulation, as well as the EFSA's webpage on nutrition and health claims, available at efsa.europa.eu/en/topics/topic/nutrition.htm.
  • [25] The EU Register is available at ec.europa.eu/nuhclaims.
  • [26] The term 'nutrient profile' refers to the nutrient composition of a food or diet. 'Nutrient profiling' therefore is the classification of foods for specific purposes based on their nutrient composition. For more information on nutrient profiling, see the dedicated webpage of the WHO on this issue: who.int/nutrition/topics/profiling/en.
  • [27] ec.europa.eu/food/food/labellingnutrition/claims/nut_profiles_en.htm
  • [28] ec.europa.eu/food/committees/advisory/sum_wg_11072008.pdf.
  • [29] This point is discussed more fully in M Friant-Perrot and A Garde (n 42).
 
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