Following the slower than anticipated uptake of e-commerce, the Distance Selling Directive 97/7/EC was implemented with the principal purpose of encouraging consumers to trust and use e-commerce by providing them with certain levels of protection.
The Directive was implemented in the UK through the Consumer Protection (Distance Selling) Regulations 2000.
Under Article 4 of the Directive, the online supplier must provide the consumer with a range of specific information before any distance contract is concluded, including:
- the supplier's identity
- the consumer's right to cancel
- the price
- the arrangements for payment
- delivery costs
- the main characteristics of the goods or services
Article 5 of the Directive requires that this information is 'received' by the consumer 'in writing or another durable medium'.
In practice, many online suppliers seek to comply with the Directive by providing a hyperlink to a webpage containing this information.
However, the recent opinion of Advocate General Mengozzi (AG) in the case of Content Services Ltd v Bundesarbeitskammer (a reference for a preliminary ruling from an Austrian court), casts doubt on whether this is an effective means of complying with the information provisions of the Directive.
Content Services Ltd (CSL) runs an internet site which allows consumers to download software for an annual subscription fee of #96.
The consumer signs up to the service and enters into the contract by completing an online registration form. The information required by Article 4 is available for the consumer to view by clicking on a hyperlink.
After concluding the contract, CSL sends the consumer an email containing a username and password to use the site, but this email contains none of the information required by Article 4. The consumer also receives an invoice for #96, along with a reminder that they have waived their right to cancel the contract.
The AG argues that this per has not receige does not constitute a durable medium
The AG feels that requiring a consumer to click on a hyperlink does not satisfy Article 5, as the consumer has to make an active effort to obtain the information, rather than the information being provided to them.
He also points out that CSL already uses email for confirming consumers' log in details, so could also provide the required information in this manner.
The AG further argues that a hyperlink to a webpage cannot be seen as a durable medium because the consumer cannot store the information provided on a webpage for a sufficiently long period, nor do they have the ability to reproduce it, unchanged, at a later date.
As a webpage is solely in the control of the supplier, this means that the terms on that webpage can be unilaterally altered by the supplier at any time.
Whilst durable medium is not defined in the Directive, the OFT's guidance on distance selling legislation suggests that this should be in a form that can be printed, retained, and reproduced, but which cannot be edited: for example, an email that can be printed, or a letter, fax, or brochure that can be kept for future reference.
Information on a website is not considered by the OFT to be durable, as it can be altered after the consumer has accessed it.
If the AG's opinion is followed, online suppliers could find themselves under much heavier administrative burdens, when looking to comply with the distance selling legislation.