Rules to Accord E-Consumers of Adequate Protection - Essay Example

In the Member State (MS) either the supplier or consumer is domiciled (Art. 16§1); in an MS where the supplier conducts directed activities and has secondary establishments related to the dispute (Art 15§2); or in courts agreed upon by the parties as evidenced in writing, including electronic communications (Art 23), provided that it was the place of performance and a common habitual residence or domicile of both parties at the time the contract was concluded (Art 17). Suppliers, on the other hand, are limited to bringing a dispute only in the MS of the consumer’s domicile (Art. 16§2). These rules are not limited by the ‘means’ that the contract was concluded (Art 15§1c), such that it covers contracts concluded electronically, extending the protection to e-consumers.

            English Common Law, on the other hand, holds that the choice of law will be that chosen by the parties unless it is not bona fide or illegal and can only be overridden by the mandatory rules under the Unfair Contract Terms Act 1977 27§2.  The absence of a choice of law, in this sense, renders the country with the closest connection applicable.

            Under the Rome Convention (Convention), since it can apply to disputes regardless if the parties are members of a contracting state to the convention (Art 2); "a contract shall be governed by the law chosen by the parties" (Art 3§1). Thus, where a law was previously selected by the parties that law will apply (Art 5§2). However, the lack of a previously chosen law necessitates that the applicable law will be that of the consumer’s domicile (Art 5§3). Furthermore, Art 7§2 states that the consumer cannot be deprived of the ‘mandatory rules of the country within which they are domiciled. In the United Kingdom, these are set by the Unfair Contract Terms Act 1977, as well as precedents in Common Law.

            In all three laws, the applicable law will be that chosen by the parties. However, under the three laws, for the rules regarding the absence of a choice of law to be enforced, it is required that ‘steps necessary for the conclusion of the contract,’ as well as ‘specific invitation’ or ‘previous advertising’ are conducted in a country for that country’s rules to be applicable (Convention, Art 5§2; Regulation, Art 13§3a; Unfair Contract Terms Act 27§2).

            These provisions, however, entail certain problems. First, the lack of clear definitions regarding fundamental concepts, such as the word ‘professionals’ for both the Regulation and the Convention; and the definition of ‘goods and services under Art 5 § 1 of the Convention, which does not cover the sale of software as well as content downloads, are bound to create jurisdictional problems for consumers. Second, with regard to the Convention, the rules are not flexible enough to cover changes in the geographic location of the consumer (Art 5 § 4), which are common in online transactions. This is in contrast to Art 15 § 1c of the Regulation, where the directed activity concept caters to changes in the consumer’s geographic location, provided that they are within the target audience of the professional; which unfortunately is rendered problematic due to lack of legal definition of ‘professional’, as mentioned above. Third, the consumer is also in danger of losing the protection of his domicile’s ‘mandatory rules as stated in Art 7§2 due to the requirement in Art 5§2 that the supplier must first indicate intent to reach a certain market to be applicable, illustrating inflexibility. Last, with regard to the Regulation, while it is theoretically favorable to provide consumers and not suppliers the luxury of choosing from a number of potential courts to hear the dispute, the lack of resources and legal knowledge of online consumers may create more in choosing where to bring their dispute.

            Hence, although it is evident that an attempt to protect the e-consumer in all aforementioned rules, the deficiencies indicated illustrates a need to further refine rules to accord e-consumers with adequate protection.