ECJ decides on shipping costs in distance selling transactions

The legal dispute concerns the question of whether, in the case of a distance selling transaction, it violates consumer protection regulations if the consumer is charged shipping costs for sending the goods to him, provided that he makes use of his right of withdrawal or return and sends the goods back to the seller in full.

The plaintiff is a consumer association. The defendant operates a mail order business. It charges its customers a flat rate of €4.95 per order for shipping the goods. The plaintiff claims that the defendant should refrain from charging such costs after exercising the right of withdrawal/return in distance selling transactions.

The Regional Court upheld the action. The Higher Regional Court dismissed the appeal. It argued that the charging of shipping costs for the delivery of the goods violated consumer protection standards. Although the costs could be imposed on the consumer under national law, the Distance Selling Directive (Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the protection of consumers in respect of distance contracts) required that the consumer be exempted from the costs of sending the goods when exercising his right of withdrawal or return in the context of a distance contract. The provisions of national law must therefore be interpreted as meaning that the costs of dispatch cannot be imposed on the consumer in such cases.

The VIII. Civil Senate of the Federal Court of Justice stayed the appeal proceedings and, in accordance with the obligation under Article 234 EC, referred to the Court of Justice of the European Communities for a preliminary ruling the question whether the provisions of Article 6(1), second sentence, and (2) of Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the protection of consumers in respect of distance contracts are to be interpreted as precluding national legislation under which the costs of sending the goods may be charged to the consumer even if he has cancelled the contract.

The Senate assumed - as did the Court of Appeal - that a claim by the buyer for reimbursement of the costs of sending the ordered goods does not exist under the provisions of German law. If the Distance Selling Directive were to be interpreted to the effect that the costs of sending the goods in the event of the cancellation of a distance selling transaction cannot be imposed on the buyer, the Senate would, however, be prompted to interpret the provision of § 312d (1) in conjunction with § 357 (1) sentence 1 and § 346 (1) of the German Civil Code - in conformity with the Directive - to the effect that sending costs paid by the buyer must be refunded after the cancellation of a distance selling transaction. Whether such an interpretation is required according to the content of the Distance Selling Directive - this is disputed in the literature - cannot be determined with sufficient certainty in the opinion of the Senate and is therefore reserved for the decision of the Court of Justice of the European Communities.

Article 6 of the Distance Selling Directive reads:

Right of withdrawal

(1. The consumer may withdraw from any distance contract within a period of at least seven working days without giving any reason and without penalty. The only costs which may be imposed on the consumer as a result of exercising his right of withdrawal shall be the direct costs of returning the goods. ...

(Where the consumer exercises the right of withdrawal in accordance with this Article, the supplier shall reimburse the payments made by the consumer free of charge. The only costs that may be imposed on the consumer as a result of exercising his right of withdrawal shall be the direct costs of returning the goods. The refund shall be made as soon as possible and in any event within 30 days.

 

Decision of the Federal Court of Justice (BGH) of 1 October 2008 - VIII ZR 268/07 - Karlsruhe Regional Court - Judgment of 19 December 2005 - 10 O 794/05 - Karlsruhe Higher Regional Court - Judgment of 5 September 2007 - 15 U 226/06

Source: Press release of the press office of the Federal Supreme Court No. 184/2008 of 01.10..2008, Herrenstr. 45 a, 76133 Karlsruhe, Tel. 0721-159-5013, Fax. 0721-159-5501, E-Mail: pressestelle@bgh.bund.de.

(c) 2008 Goldberg Attorneys at Law

Attorney at Law Michael Ullrich, LL.M. (Information Law)

E-mail: m.ullrich@goldberg.de

 

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