Further tangles for Web trade

New legislation could make online shopping less of a gamble for European consumers, writes Robert Dunt

New legislation could make online shopping less of a gamble for European consumers, writes Robert Dunt

What does a UK Internet customer do when the suit he bought over the Web from a company based in another European Union country arrives with ripped pockets?

If the only contact phone number on the merchant’s Web site is constantly engaged, then the purchaser could take the case to court.

But the legal problems of cross-border jurisdiction, and the following expense for experts on such a narrow area of the law, would probably put most people off.

However, the European Parliament is debating legislation that could ease these situations.

If MEPs give it their backing, then all pan-European e-businesses would legally be required to have a complaints process, or to belong to an enterprise that runs a complaints system. Either way, the companies would have to meet European Commission criteria to keep trading. The rationale is that this alternative dispute resolution system would bypass national barriers and cut costs for consumers and businesses.

But how realistic is such a plan, and do companies think it would actually help?

“In very broad terms, anything that helps to protect the rights of consumers should be encouraged, as that way more and more business will be done online,” said Toby Nicol, spokesman for easyJet, which sells airline tickets online.

But he was concerned about the implications of the plan - especially the assertion that companies could not trade if they did not meet the criteria. “The Internet is a global business, rather than something that just takes place in Europe - I’d be interested to see how the legislation would be implemented.”

Nicol explained that 75% of easyJet’s business - including a complaints service - took place on the Web. Any disputes that turn into law suits are resolved in court, in Madrid or London. In broad terms, if the legislation did remove the problem of solving court cases in different countries it would make life easier for easyJet, he added.

But Nicol said he would need to see the exact plans. “The devil, as they always say, is in the detail.”

Simon Cohen, managing director of SME guvnor.com - a Web site that provides a trading centre for the music industry on a B2B and B2C basis - demonstrated a pragmatic view of the proposals.

“By and large, you would not see people using a complaints procedure a great deal. If a person has a problem, invariably it’s the merchant that catches it - the purchaser just rings up and cancels his credit card transaction,” Cohen said.

Cohen could not see many people participating in the scheme even if it was law. “I don’t know how they’d police it - there’s zillions of traders out there now. The big comfort for customers is that if the trader gets it wrong the customer can just recharge their card.”

Institute of Trading Standards e-business spokesman Richard Webb said he thought the scheme would be good for both consumers and businesses.

But he doubted the requirement for each company to set up some form of complaints system would become law, as it could contradict fair trade and many businesses would be against the plan.

Webb said groups including the Association of British Travel Agents (ABTA), Consumer Credit Trade Assoc-iation and Financial Services Association were already trying to set up networks for this kind of dispute.

Under their scheme, a consumer would identify the industry area where they had experienced a problem and then get in touch with, for instance ABTA. An ABTA representative would then contact their counterpart in the country where the contract had originated.

Webb said he could see networks like this becoming common in the near future. If this comes about, rather than national boundaries causing problems in dispute resolution, the sheer number of complaints systems developed by European government, industry groups and individual companies could be just as confusing for businesses and consumers alike.

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