The European Court of Justice (ECJ) in Luxembourg has now issued a ruling that really packs a punch.

Entrepreneurs must always inform their customers – if they are consumers – about their right of withdrawal. This applies to contracts that are not concluded in business premises or by means of telecommunication (letter, catalog, telephone, e-mail, SMS).

This regulation already existed in German law. The European Court of Justice has gone one better.

The trader must inform the consumer of his right of withdrawal.

If the trader fails to provide this information, the customer can not only withdraw from the contract within the extended withdrawal period, but also refuse to pay. If the customer has already paid, they can demand a full refund of the payment.

The extended withdrawal period is then one year and 14 days. This is now European case law. It does not matter that the entrepreneur has already provided the service! Customers can therefore benefit from free services.

This was previously disputed. German case law assumed a so-called unjust enrichment of the customer, i.e. the receipt of a service without consideration. The Essen Regional Court, which heard such a case, therefore referred this legal issue to the European Court of Justice.

Threat of reclaims

The European Court of Justice makes it clear that the high level of consumer protection, which is the aim of the European Union directives, cannot be circumvented. Nor may it be circumvented by special national regulations.

Consumer protection takes precedence over the interests of traders. The Court of Justice believes that traders are in a stronger position and therefore have a duty to inform consumers of their rights.

The idea behind this is in particular to protect consumers from aggressive door-to-door and telephone marketing.

However, the ruling of the European Court of Justice applies to many other entrepreneurs, such as tradesmen, who generally do not send their customers a withdrawal policy and the model withdrawal form provided.

This is exactly where the revocation and reclaim hammer threatens. And the reclaim can quickly reach high amounts.

For consumers: make use of your right. If you have not been informed of your right of withdrawal, you can still withdraw from the contract and claim your money back.

For entrepreneurs: make sure you are safe from the outset. Send your customers the cancellation policy and have them confirm receipt by signature. If the service is to begin immediately, let the customer waive their right of withdrawal.

Are you a consumer and want to cancel your contract? Are you an entrepreneur and want to protect yourself legally?

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