In the recent case of Content Services Ltd v Bundesarbeitskammer Case C-49/11, the ECJ held that providing consumers with hyperlinks to a web site containing the information required to be given to consumers by Article 4 of the Directive 97/7/EC (the Distance Selling Directive) did not constitute the consumer being ‘given’ or having ‘received’ the information within the meaning of Article 5(1). Furthermore, by virtue of the nature of general web sites which allow the content to be altered by the seller at any given time, Content Services’ web site did not constitute a ‘durable medium’ for the purposes of Article 5(1) of the Directive.
The facts
Content Services Ltd provide various services online via its web site, namely allowing consumers to download free software or trial software, charging a fee of €96 for access to the content. In order to use the web site, the consumer has to sign up to the site by filling out a registration form. By declaring that he or she accepts the general terms and conditions when placing an order, the consumer waives the right of withdrawal by ticking a box on the form. The information required by Articles 4 and 5(1) of Directive 97/7, whilst not displayed to Internet users on the site as part of the sign-up process, is available by clicking on a hyperlink. After completing the registration process, the consumer is sent a confirmation e-mail from Content Services providing a username and password to gain access to the site; this e-mail also contains a link via which information on the right of withdrawal can be obtained.
The main proceedings were brought by the Austrian body responsible for the protection of consumers, arguing that the business practice of Content Services infringed several provisions of EU and domestic law in relation to consumer protection. It won the case in the lower court, and on appeal the following question was referred to the Court of Justice for preliminary ruling:
‘Is the requirement in Article 5(1) of the Distance Contracts Directive to the effect that a consumer must receive confirmation of the information specified there in a durable medium available and accessible to him, unless the information has already been given to him on conclusion of the contract in a durable medium available and accessible to him, satisfied where that information is made available to the consumer by means of a hyperlink on the trader’s web site which is contained in a line of text that the consumer must mark as read by ticking a box in order to be able to enter into a contractual relationship?’
The decision
Article 4 of Directive 97/7 provides that a consumer shall be provided with a range of information including, amongst other things, the supplier’s identity and the consumer’s right to cancel (the right of withdrawal). Article 5(1) of Directive 97/7 provides that the consumer must receive written confirmation or confirmation in another durable medium available and accessible to him of the information referred to in Article 4, in good time during the performance of the contract, unless the information has already been given to the consumer prior to conclusion of the contract in writing or on another durable medium available and accessible to him.
The ECJ focused on two aspects of the requirements in Article 5(1) of the Directive, namely: (i) whether the relevant information under Article 4 is ‘given’ to or ‘received’ by the consumer, and (ii) whether a web site, the information of which is accessible to consumers via a hyperlink provided by the seller, must be regarded as a ‘durable medium’.
What is the meaning of ‘receiving’ and ‘giving’ information?
As the Directive does not provide any insight into the scope of ‘receiving’ and ‘giving’ information in the context of Article 5(1), the ECJ held that their usual meaning must be determined by looking at their use in everyday language. The Court noted that the terms ‘receive’ and ‘given’ refer to a process of transmission. The underlying concept of transmission is that it is not necessary for the recipient, in this case the consumer, to take any action. In contrast, where a hyperlink is provided, the consumer must act by clicking on the link in order to access the information.
The ECJ referred to the purpose of Article 5(1) – of ensuring that the information necessary for the consumer to exercise his rights, including his right to withdrawal under Article 4, is communicated to the consumer. The legislature’s decision to use the term ‘receive’ in Article 5(1), as opposed to the term ‘provide’ as used in Article 4, placed a greater burden on a business; the term ‘receive’ denotes passive conduct by consumers.
The Court concluded that the objective of the European legislature in drafting the Directive was to prevent situations whereby the use of distance communications leads to consumers being provided with less information. The consumer should be given the information without having to be in any way proactive. The ECJ therefore held that the information is neither ‘given’ to nor ‘received’ by the consumer where a hyperlink is provided to the consumer to access the information on the seller’s web site.
What constitutes a ‘durable medium’?
Article 5(1) provides that the information in Article 4 must be provided to the consumer either in writing or on another durable medium. Whilst the Directive itself does not provide a definition of ‘durable medium’, the ECJ referred to the definition of ‘durable medium’ in other legislative texts, namely Article 2(f) of Directive 2002/65, Article 2(12) of Directive 2002/92 and Article 3(m) of Directive 2008/48. Whilst these directives were not directly applicable in this case, the Court held that there was nothing to indicate the definition of ‘durable medium’ provided in these directives should be different to that used in Directive 97/7. The Court further cited Article 2(10) of Directive 2011/83, which will replace Directive 97/7 on the 13 June 2014, noting that the definition of ‘durable medium’ within it was consistent with those cited above.
Relying on the definition of ‘durable medium’ provided in these legislative texts, the ECJ held that a durable medium must ensure: (i) that the consumer is in possession of the information necessary to exercise his rights, (ii) that the consumer is able to store the information, (iii) that the content is not altered, (iv) that the information is accessible for an adequate period of time, and (v) that the consumer is able to reproduce the information unchanged. The intention of the European Union legislature was that the durable medium should have the same functionality as a paper format.
Taking the above into account, the ECJ concluded that Content Services’ web site did not allow the consumer to store the information which was personally addressed to him or her in a way which would allow the consumer to access the information and reproduce it unchanged for an adequate period of time. Furthermore, as noted by Advocate General Mengozzi in his Opinion, the very nature of such a general web site precludes the consumer from having control over the information on the web site, as Content Services, being the owner of the web site, can change the content at any time. It was therefore held that Content Services’ web site could not be regarded as a ‘durable medium’ within the meaning of Article 5(1) of the Directive.
Comment
This case sets out clear criteria which must be met when considering whether any technology falls within the definition of ‘durable medium’. Whilst the case seems to confirm the OFT’s guidance in relation to the Distance Selling Regulations, which states that information on a web site cannot be considered as durable as it can be changed by the seller after the consumer has accessed it, it should be noted that the ECJ provided no ruling in relation to the point raised by Content Services with reference to the European Securities Markets Expert Group report. The report distinguishes between ‘ordinary web sites’ and ‘sophisticated web sites’, concluding that some sophisticated web sites may meet the criteria to be classed as a ‘durable medium’.
Indeed, both the ECJ and Advocate General Mengozzi referred to the Court of the European Free Trade Association case Inconsult Anstalt v Finanzmarktaufsicht Case E-4/09, in which the EFTA Court held that a web site can constitute a durable medium provided that the criteria of the definition of a ‘durable medium’ (set out above) are met. However, this is likely to be decided on a case-by-case basis.
Whilst there is arguably some discord between the Distance Selling Regulations and the Directive, with the former requiring that the seller ‘shall provide’ written confirmation and the latter having been interpreted by the ECJ to include a requirement that the consumer must ‘receive’ the information, it is unlikely that this will have any real impact in practice. Online sellers should include the information required by Article 4 of the Directive in any confirmation e-mails or delivery notes sent to the consumer in order to avoid potentially failing to meet the requirements under Article 5(1) of the Directive. As Advocate General Mengozzi pointed out in his Opinion, if the online seller already makes use of e-mails by way of informing consumers of their log-in details to their site, there is no reason why the required Article 4 information could not be included in this manner.
John Armstrong is a senior partner in the IT and Telecommunications department of CMS Cameron McKenna.
Janine Kessel is a trainee lawyer in the IT and Telecommunications department of CMS Cameron McKenna.
