EU Commission Publishes Report Assessing EU Consumer Laws and Paves Way for New and Stronger EU Consumer Law for the Digital Space

On October 3, 2024, the European Commission published a report evaluating the effectiveness of existing EU consumer protection laws in protecting consumers in the digital space. More specifically, the report assesses the effectiveness of the following three consumer protection laws: (i) the Unfair Commercial Practices Directive ("UCPD"); (ii) the Consumer Rights Directive ("CRD"); and (iii) the Unfair Contract Terms Directive ("UCTD"). It also identifies and analyses the main provisions in the DSA, DMA, Data Act, and AI Act that are of particular relevance for protecting consumers in the digital environment. The report is the result of the 2022 public consultation we mentioned in our previous blog post.

The report found that the existing EU consumer laws are not sufficiently effective in tackling current and emerging consumer harms in the digital environment. The report will support the European Commission's intention to start working a new EU consumer law called the "Digital Fairness Act". The new Act is expected to:

• tackle new consumer risks in the digital space, such as dark patterns, addictive design and gaming, influencer marketing, personalization (of ads, rankings, recommendations and pricing/offers), contract cancellation, automated contracts in the context of connected devices, digital subscriptions, and generative AI systems (e.g., AI chatbots) and emotion-recognition AI systems;
• provide for a greater degree of harmonization, further reducing differences in consumer laws at Member State level; and
• ensure better enforcement, for example through the use of automated enforcement tools (e.g., automated market sweep tools), by strengthening the powers of consumer authorities to undertake joint enforcement actions, and by ensuring an increase in national and CJEU case law on consumer law in the digital environment.

This new regulation is expected to be proposed by the Commission in the coming years.

* * *

Covington & Burling regularly advises companies on all aspects of EU consumer law, as well as intersections with privacy, cybersecurity, and product safety laws. We are happy to assist you with any inquiries related to compliance with EU consumer law.