Consumer Rights Directive Threatens Growth for SMEs

EU Legislation shocks SME community

Thousands of small businesses across Britain and Europe are at huge risk of being forced out of business if proposed amendments to the Consumer Rights Directive are pushed through by the European Union, warns Quentin Pain, chairman and founder of accounting software specialist Accountz.

Recently, the European Parliament introduced a series of amendments to Commission’s proposal for a Directive protecting online consumers rights. MEPs backed a series of new rules to protect online shoppers and boost consumer confidence to buying in other Member States.

The amendments, which if passed will apply whether a transaction is made in a shop, on the phone, online or by mail order, include:

  • A 14-day window in which consumers across the EU can change their mind about the transaction and a legal responsibility for sellers to deliver goods within 30 days

  • Retailers will be forced to cover the return costs for order values of more than €40. The risk for businesses, are that it will encourage consumers to order without intending to purchase, therefore placing an overwhelming financial burden on small businesses selling online

  • All retailers will be required to sell into any EU country, which will result in retailers being pushed into selling in unknown markets, which might not be appropriate for their business model

The impact of these amendments has led to a huge outcry from industry associations all over Europe, who strongly feel that these changes to the e-Commerce retail landscape will force businesses into pushing up costs for hard-pressed consumers, across all retail channels. The knock on effect will have serious ramifications on SMEs and the start-ups growth market, due to the risk, complexity and cost now associated with trading online.

Quentin Pain, states that these amendments to the Consumer Rights Directive will be very bad for business, and will very likely stop any recovery in its tracks:

“The changes proposed to the Consumer Rights Directive, are absolutely crazy, and will be extremely harmful to the recovery and growth of online trading. The internet is key to the success of any SME – it enables small businesses to offer choice and price competitiveness. These amendments will go a huge way to deterring the growth of start-ups, which in turn, will have a huge ripple effect on the entire economic recovery. The European Parliament, have really been ill-informed and have completely disregarded the thoughts and opinions of the retail community as a whole – it’s EU legislation, gone mad.”

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