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A recent study published by the European Consumer Centre's Network entitled "Realities of the European online marketplace" (which included a review of 15 Irish web traders out of a total of 262 web sites) revealed some very interesting findings.
Over a period running from the end of 2002 into the early part of 2003, 114 orders for goods were made and 262 websites were examined.
The products chosen for the study sought to reflect the "popular Internet purchases" and included; clothes, computer consumables, CD's, DVD's, toys, books and a watch.
The primary focus was to see how the reality of the online shopping experience compared with the requirements of the Distance Selling and the E-Commerce Directives with a special focus on the cooling- off period.
For businesses that are trading online or intending to grow this channel there are some very important lessons to be drawn from this study.
Here are some of the more interesting findings;
- Although
the Internet is perceived as "a global marketplace" the
majority of EU online traders surveyed only operate in their domestic
market. A small minority operate cross border. Some of the websites
surveyed specifically excluded cross border sales and others not engaged
in cross border sales failed to make this clear.
- Overall
the study categorised the "online shopping experience" as
poor. In many instances orders were not delivered, essential information
about consumer's rights was omitted and the cost of returned goods
was not reimbursed.
- Of
the total of 114 orders placed only 75 resulted in a delivery. In
other words 34% of the products ordered were not delivered and in
8% of the cases the products were not delivered even though they had
been paid for.
- In
24% of the cases where credit cards were used, payment withdrawn before
the goods ordered had been delivered.
- Where
goods were returned in 31.5% of the cases no refund was received and
in only 37% of the cases did the return result in a refund including
the delivery fee.
- 8% of
the orders placed generated no response whatever from the online trader.
- 18%
of the orders were confirmed but no delivery was effected.
- In
5% of the cases no order confirmation was received but the goods were
subsequently delivered.
- 8% of
the orders resulted in an order confirmation, a charge for the goods
but no delivery.
- 3.5%
of the orders were confirmed, delivered but not charged.
- 57%
of the orders resulted in confirmation of the order, delivery of the
goods and the charge being deducted.
- The overall delivery rate for goods ordered only amounted to 66%
Final Cost
All websites selling to consumers as well as order confirmations must clearly state the total price of the transaction including delivery fees to be debited. A comparison between the confirmed and charged price found them to be the same in 96% of the cases.
Receipt or Invoice
Consumers must receive a receipt or equivalent record of the transaction. 83% of the deliveries included such a receipt.
Information in writing of revocation and returning rights.
Online traders must give consumers information on how to return goods if dissatisfied as well as outlining the consumer's right to return the goods during the "cooling off period".
Online traders can provide this information on the website or with the order confirmation but best practice would also include this information when delivery is made.
36% of the deliveries included this information. However only 56% of the deliveries contained information as to how to exercise the right in the case of the particular transaction.
After-sales service, warranty and guarantee conditions
Equivalent requirements exist here as for revocation and return. The study showed that only 31% of the deliveries included this information.
Returns
As referred to above, consumers have the right to avail of the right to return the goods purchased during the "cooling off period" and to be informed of this right. The study found that in 56% of the deliveries this information was not provided.
Consumers are not obliged to give a reason for returning the goods yet the study found that in 24% of the cases the web trader concerned demanded a reason for the return.
The Distance Selling Directive requires that the only cost that the consumer should pay in returning goods ordered is the direct cost of returning the goods - in other words the return freight charge. This means that if the web trader charged a delivery fee to the consumer this should be refunded.
The study found that in 63% of the cases where goods were returned either no refund was made or the refund made excluded the delivery charges that had been levied.
Conclusions
This study has thrown up some very interesting findings which point to some serious concerns about the realities of cross border consumer shopping - concerning the failure to meet the legal requirements laid down by the Directives.
As an example - the report authors point out that it is hardly satisfactory if only 66% of the goods ordered were in fact delivered, or that in 24% of the cases the consumer paid for the goods before delivery or that in only 56% of the cases did the web trader inform the consumer of its returns procedures.
This study suggests that in reality cross border consumer shopping is not yet that "consumer friendly" which would point to the existence of a clear inhibitor to the growth of this important sector.
The Director of Consumer Affairs is on record as saying that her office will take enforcement action for breaches of the Distance Selling and E-Commerce Directives - so it is important that Irish web traders take steps to address any deficiencies in their online operations especially as regards sales to consumers.
| For
further information contact: Patrick Ryan at Email : pryan@kilroys.ie © Kilroys Solicitors 2004 |
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Employment
law update
1. National Minimum Wage
The National Minimum Wage increased from €6.35 to €7.00 per hour on the 1st February, 2004. This increase applies to all experienced adult employees, whether full time or part -time employees and the €7.00 per hour is the gross amount i.e., before tax or PRSI is deducted.
There is a scale ranging from €4.90 per hour to €6.30 per hour for employees who are under the age of 18 years of age or who are in the first two years of their employment over the age of 18 years.
2. Two Recent Employment Appeals Tribunal Decisions
In the case Flannery - v - Sourceskills Limited the Employment Appeals Tribunal awarded an employee €15,000 in a constructive dismissal claim.
The Tribunal said that the onus was on the employer to show that the manner in which the employee's employment was terminated did not amount to an unfair dismissal and that this onus had not been discharged by the employer.
The employee claimed that she was pressurised into a situation where her only option was to accept that her job had been terminated. Sourceskills Limited argued that the employee had resigned and denied that she had been dismissed.
The Tribunal noted that when the employee was called into a number of meetings with her employer she was on her own, with absolutely no support even though it was clear that she must have been in a high state of anxiety.
The second case was taken by the General Manager of the DSPCA who claimed that she had experienced open hostility form her employer, that she felt that she was continually "on trial" and that she had been undermined during the course of her employment. The DSPCA contended that the dismissal was on grounds of redundancy but this was rejected by the Tribunal.
The significant factors in the Tribunal's findings was the failure of the employer to notice the severe stress suffered by the employee and also the general remoteness of the employer in their day to day contact with the employee.
The Tribunal acknowledged that the employee was still suffering from stress at the time of the hearing and did not discount the award of €30,000 by her failure to mitigate her losses by returning to work.
1. National Minimum Wage
The National Minimum Wage increased from €6.35 to €7.00 per hour on the 1st February, 2004. This increase applies to all experienced adult employees, whether full time or part -time employees and the €7.00 per hour is the gross amount i.e., before tax or PRSI is deducted.
There is a scale ranging from €4.90 per hour to €6.30 per hour for employees who are under the age of 18 years of age or who are in the first two years of their employment over the age of 18 years.
2. Two Recent Employment Appeals Tribunal Decisions
In the case Flannery - v - Sourceskills Limited the Employment Appeals Tribunal awarded an employee €15,000 in a constructive dismissal claim.
The Tribunal said that the onus was on the employer to show that the manner in which the employee's employment was terminated did not amount to an unfair dismissal and that this onus had not been discharged by the employer.
The employee claimed that she was pressurised into a situation where her only option was to accept that her job had been terminated. Sourceskills Limited argued that the employee had resigned and denied that she had been dismissed.
The Tribunal noted that when the employee was called into a number of meetings with her employer she was on her own, with absolutely no support even though it was clear that she must have been in a high state of anxiety.
The second case was taken by the General Manager of the DSPCA who claimed that she had experienced open hostility form her employer, that she felt that she was continually "on trial" and that she had been undermined during the course of her employment. The DSPCA contended that the dismissal was on grounds of redundancy but this was rejected by the Tribunal.
The significant factors in the Tribunal's findings was the failure of the employer to notice the severe stress suffered by the employee and also the general remoteness of the employer in their day to day contact with the employee.
The Tribunal acknowledged that the employee was still suffering from stress at the time of the hearing and did not discount the award of €30,000 by her failure to mitigate her losses by returning to work.
| For
further information please contact Laurena Hughes at Email : lhughes@kilroys.ie © Kilroys Solicitors 2004 |
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European
Communities (Copyright and Related Rights) Regulations 2004
On the 19th January 2004 the Minister for Enterprise, Trade and Employment signed into law the European Communities (Copyright and Related Rights) Regulations 2004 (S.I. No 016 of 2004) which amended the Copyright and Related Rights Act 2000 so as to transpose certain provisions of Directive 2001/29/EC.
The principle objective of this Directive is the incorporation into EU law of the provisions of the 1996 WIPO Copyright Treaty and the Performance and Phonograms Treaty.
The 2000 Act gave effect to these Treaties in advance of the adoption of the Directive but on review it was felt that there was a requirement for a number of changes to ensure that Irish law fully and properly reflected the provisions of the Directive.
Following a detailed examination and consultation process it was felt that the 2000 Act was deficient in two key areas.
On the 19th January 2004 the Minister for Enterprise, Trade and Employment signed into law the European Communities (Copyright and Related Rights) Regulations 2004 (S.I. No 016 of 2004) which amended the Copyright and Related Rights Act 2000 so as to transpose certain provisions of Directive 2001/29/EC.
The principle objective of this Directive is the incorporation into EU law of the provisions of the 1996 WIPO Copyright Treaty and the Performance and Phonograms Treaty.
The 2000 Act gave effect to these Treaties in advance of the adoption of the Directive but on review it was felt that there was a requirement for a number of changes to ensure that Irish law fully and properly reflected the provisions of the Directive.
Following a detailed examination and consultation process it was felt that the 2000 Act was deficient in two key areas.
-
Article 5.1 of the Directive provides for a mandatory exception from copyright for incidental copies of works - such as electronic cached and screen copies in a particular form. The Regulations amend Sections 87 and 244 of the 2000 Act so as to provide that "temporary acts of reproduction which are transient or incidental" and whose sole purpose is to facilitate transmission "in a network between third parties by an intermediary".
- Article 6.4 of the Directive requires member states to ensure that access to copyrighted material is afforded to persons who are legally entitled to such access but who are prevented by the application of technological protection measures by rightholders - including the right of such beneficiaries to seek an order of the courts to force such access.
| For
further information contact: Anthony Layng at Email : alayng@kilroys.ie © Kilroys Solicitors 2004 |
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Data Protection - Important UK Court of Appeal decision with implications for the interpretation of "Personal Data".
A recent decision in the UK Court of Appeal in the case of Durant -v- Financial Services Authority has significant implications for any person making or responding to an access request.
This is a decision of the English Court of Appeal and as such it is not binding on the Irish Courts. That said it could have persuasive authority if a case turning on similar facts was to come before the Irish Courts.
Briefly the facts of the case are as follows. Mr. Durant sought information from the UK Financial Services Authority (FSA) under the provisions of the UK Data Protection Act (DPA) which he claimed was personal data relating to him. The access request related to complaints made by Mr. Durant to the FSA regarding Barclays Bank plc and also relating to the handling of his complaint by the FSA.
The FSA provided him with certain information which it had maintained in electronic form but with certain information relating to the identities of other persons removed. The FSA refused to supply any relevant documents held in its manual files.
Mr. Durant then sought full disclosure of the electronic documents and full disclosure of the manual files. This request was refused and arising out of this refusal the matter came before the UK Court of Appeal.
In the context of this brief article the appeal to the Court raised three important legal issues:
| 1. | What constitutes data (whether held in electronic or manual files) as "Personal Data" as defined in the DPA entitling the person identified by it to seek its disclosure? |
| 2. | What does "relevant filing system" mean in the context of the definition of "data" in the DPA so as to constitute information recorded in a manual filing system as "Personal Data" that is disclosable in response to an access request? |
| 3. | On what basis would a Data Controller - when responding to an access request - be entitled to redact such information that would identify third parties whose consent to such disclosure had not been obtained? |
As to the first of these three questions the Court held that further disclosure as sought by Mr. Durant (whether of computerised or manual files) was not justified because the information in question did not have Mr. Durant as its focus and as such was not "Personal Data" within the meaning of the DPA.
In response to the second of these questions the Court found that Mr Durant was not entitled to disclosure of the FSA's manual files because these did not constitute a "relevant filing system" as defined in the DPA. The files in question were not structured in such a way that specific information about Mr. Durant would be readily accessible on a search being made for specific information about him.
As to the third or these questions the Court held that the FSA had acted properly in redacting certain information from the information provided to Mr. Durant that identified other individuals and that such redacted information did not constitute Mr. Durant's "Personal Data".
Although this is an authoritative case in the UK with important implications for individuals making access requests in that jurisdiction and for Data Controllers responding to such requests it may yet prove to be a precedent with persuasive authority before the Irish Courts.
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further information contact: Patrick Ryan at Email : pryan@kilroys.ie If you would like to receive our Business Briefing on the Irish Data Protection legislation in CD-Rom format please contact Patrick Ryan © Kilroys Solicitors 2004 |
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New
Commercial Court to take commercial litigation into the 21st Century
The new Commercial Court commenced work on the 12th January 2004. It has a general value threshold of €1 million. This court will cater for amongst others, intellectual property cases and judicial reviews.
The essential aim of this new court is to provide for more effective case management before a matter in dispute is finally heard. The intention according to Mr. Justice Finnegan, President of the High Court is to protect litigants from the long Irish tradition of litigation "by ambush".
Lawyers must prepare what Justice Finnegan has referred to as "a must read bundle of documents", which should ensure that there is greater clarification of issues in dispute in advance of the commencement of the court hearing which, in turn should result in shorter trials.
One of the most fundamental aspects of the new Commercial Court is its reliance on electronic evidence which will allow more efficient identification of the core issues and the type of evidence required.
Witness statements will have to be exchanged in advance and these can be used in evidence once verified in an Affidavit. Expert reports will have to be furnished and exchanged in advance and expert witnesses will be obliged to confer with each other prior to the hearing to see what points of agreement can be identified. The parties to the litigation will also be obliged to set out their case in writing, thus avoiding the lengthy opening statements by Counsel.
Court facilities will allow for computer access by the litigants and their legal team. The Court also caters for electronic filing of documents, video conferencing and real time stenography.
Justice Finnegan hopes that the new Court shall lead to reduced costs by encouraging settlement of commercial disputes. It remains to be seen whether this proves to be the case in practice.
The new Commercial Court commenced work on the 12th January 2004. It has a general value threshold of €1 million. This court will cater for amongst others, intellectual property cases and judicial reviews.
The essential aim of this new court is to provide for more effective case management before a matter in dispute is finally heard. The intention according to Mr. Justice Finnegan, President of the High Court is to protect litigants from the long Irish tradition of litigation "by ambush".
Lawyers must prepare what Justice Finnegan has referred to as "a must read bundle of documents", which should ensure that there is greater clarification of issues in dispute in advance of the commencement of the court hearing which, in turn should result in shorter trials.
One of the most fundamental aspects of the new Commercial Court is its reliance on electronic evidence which will allow more efficient identification of the core issues and the type of evidence required.
Witness statements will have to be exchanged in advance and these can be used in evidence once verified in an Affidavit. Expert reports will have to be furnished and exchanged in advance and expert witnesses will be obliged to confer with each other prior to the hearing to see what points of agreement can be identified. The parties to the litigation will also be obliged to set out their case in writing, thus avoiding the lengthy opening statements by Counsel.
Court facilities will allow for computer access by the litigants and their legal team. The Court also caters for electronic filing of documents, video conferencing and real time stenography.
Justice Finnegan hopes that the new Court shall lead to reduced costs by encouraging settlement of commercial disputes. It remains to be seen whether this proves to be the case in practice.
| For
further information contact: Thomas Simpson at Email : pryan@kilroys.ie © Kilroys Solicitors 2004 |
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