Amendment to the Civil Code
As of 6th January 2023, the amendment to the Act No. 89/2012 Coll., the Civil Code (the Act No. 374/2022 Coll.) introducing a new legislation on consumer protection has become effective.
The amendment to the Civil Code (“CC”) primarily extends the information obligation of the entrepreneur towards the consumer (Sec.1811 of the CC). The entrepreneur will be obliged to inform the consumer well in advance of the conclusion of the contract or before the consumer makes a binding offer, for example:
- in addition to the details of its identity, always about the address of the registered office, a telephone number and, about an address for the delivery of electronic mail, if any,
- the time of delivery or performance,
- about the total price of the goods or services, including all taxes and charges. Only if the nature of the goods or services does not allow this price to be reasonably determined in advance, the information about the total price may be replaced by a method of calculating thereof,
- about information on the characteristics of the digital content that will be known or could reasonably be expected to be known to the entrepreneur, namely information on (i) so-called compatibility, which means the ability of the digital content or digital content service to work together with the technical and software equipment (hardware and software) that are normally used with the digital content or digital content service without the need for conversion (e.g. (ii) so-called interoperability, i.e. the ability of the digital content or digital content service to work with technical and software equipment (hardware and software) that are different from the technical and software equipment normally used with the same type of digital content or digital content service.
Further, the amendment also clarifies the definition of abusive arrangements and adds and clarifies the list of specific abusive arrangements. According to the new regulation, certain abusive arrangements will always be prohibited (Sec. 1814(1) of the CC), for example arrangement:
- allowing the entrepreneur to increase the price without the consumer having the right to withdraw from the contract in the case of a substantial price increase,
- imposing a disproportionate penalty on the consumer in the case of a breach of the obligation, or
- allowing the entrepreneur to assign the contract if this may lead to a deterioration in the consumer's position.
On the other hand, some arrangements will be subject to a more moderate regime (Sec.1814(2) of the CC). In these cases, the abusive nature of the arrangement will be presumed and it can be proven in the particular case that it is not an abusive arrangement given particular circumstances. Such an arrangement will be for example:
- giving the entrepreneur the right to terminate the obligation without good cause without giving reasonable notice period.
The information obligation of the entrepreneur towards the consumer is also extended in specific cases of distance contracts and obligations under contracts concluded outside business premises (Art.1820 et seq. of the CC). The entrepreneur will now also be obliged to inform the consumer well in advance of the conclusion of the contract or of the consumer's making a binding offer, in particular about:
- address for the delivery of electronic mail, and, where applicable, the details of any other means of online communication. The new provision takes into account the use of modern technologies and gets rid of obsolete means of communication (e.g. fax),
- an indication of the adaptation of the price to the consumer's personality on the basis of automated decision-making, where the price has been so adapted. This obligation is based on the practice whereby many businesses monitor and profile consumer behaviour on the basis of automatically stored data.
The stricter legal regulation will also apply to a specific method of concluding a contract by distance, namely concluding contracts by telephone (Sec.1825 of the CC). The entrepreneur will be obliged to disclose at the beginning of each call the business purpose of the call and his identity. The consumer shall only become bound by the offer once he has given his consent electronically or by signing a confirmation of the offer on a document.
The consumer will still be entitled to withdraw from a distance contract or a contract concluded outside business premises within 14 days (Sec.1829 of the CC). However, in some cases a special period of 30 days will apply.
Furthermore, the priority order of rights from defective performance in the sale of goods in a shop is clearly set out as follows:
- if the item is defective, the buyer shall be entitled to demand its removal first,
- if the repair or replacement does not provide a proper remedy, the consumer shall be entitled to a reasonable discount or to withdraw from the contract.
The new legislation also introduces a right of recourse of the final seller against the responsible person in the contractual chain (Sec. 2174b of the CC). It will now apply that if the defect was caused by the act (omission) of another person in the same contractual chain, the final seller has the right to claim compensation from the person who sold the item or was obliged to provide the digital content or digital service to him in the course of his business. An arrangement which excludes or restricts this right in advance shall be disregarded.