Consumer rights: what are they and how are they regulated?
The moment you decide to start a new business you should be well aware that you have and will have legal obligations to your customers. In fact, the law protects consumer rights with specific local, national or international regulations. That is why it is essential that you know what these rights are and what regulations apply to products and services in relation to them. Even before that, however, it is important that you know the definition of a consumer.
Who is the consumer?
To find out who the consumer is you can refer to the definition of it given by the Consumer Code, a complex of articles that, since 2005, has put order on the rules governing the rights of this particular figure and how they can be exercised.
A consumer, according to what the Consumer Code explains, is “a natural person acting for purposes unrelated to any entrepreneurial, commercial, craft or professional activity carried on.”
Based on this definition of consumer, you can easily guess that companies, entities or legal entities are excluded from it, as the Consumer Code explicitly refers to a “natural person.” The other basic requirement you must pay special attention to is that this natural person must be acting for non-business purposes.
The definition of consumer, however, is not enough to exhaust reflection on this particular figure. You must, in fact, also consider the psychological implications that influence its connection with those who produce goods or services. In this regard, it may be helpful for you to keep Philip Kotler‘s words firmly in mind:
“Trust is more present in horizontal relationships than in vertical ones, as evidenced by the fact that consumers trust other consumers far more than they trust businesses.”
What is the Consumer Code
To define consumer we have had reference to the Consumer Code but, given the importance of this text in consumer protection, it is necessary to explain more broadly what it is and what it provides.
The Consumer Code was enacted in 2005 (it is, more precisely, Legislative Decree No. 206 of September 6, 2005) and was subsequently updated. This set of rules was created to encapsulate in a single text the entire national legislation on consumer protection and also includes the provisions issued by the European Union acquired by Italian legislation.
The Consumer Code consists of 6 parts:
- Part I, containing general provisions;
- Part II, devoted to rules on education, information, business practices and advertising;
- Part III, which regulates the consumer relationship;
- Part IV, which focuses on rules regarding product safety and quality;
- Part V, pertaining to consumer associations, access to justice and class action;
- Part VI, which puts the final provisions on consumer rights in black and white.
Basic rights and consumer protection
Now that you know who the consumer is and what the Consumer Code is, you can venture out to discover consumer rights with more knowledge. In the Consumer Code it is made clear from the very first lines that the following rights are recognized as fundamental to the consumer:
- the right to health protection (to be understood here as protection of health and, that is, to refer to that which is capable of endangering it);
- the right to safety and quality of products and services (a product is considered safe when, under normal or reasonably foreseeable conditions of use, it presents no risk or only minimal risks, compatible with its use and deemed acceptable according to a high level of protection of people’s health and safety)
- the right to adequate information and proper advertising (it is mandatory to inform the consumer in a clear and understandable manner about the real characteristics of the products sold);
- the right to the exercise of commercial practices in accordance with principles of good faith, fairness and loyalty (which translates into the obligation not to give the consumer indications that could significantly alter his or her ability to choose, prompting him or her to make a commercial decision that, otherwise, he or she would not have made);
- the right to consumer education (consumers must be guaranteed the possibility of acquiring awareness of their rights and interests, so that they may be able to make an “informed” choice in the purchase of products and/or use of services);
- the right to fairness, transparency and equity in contractual relations (the contract must be prepared and formulated in a clear and comprehensible manner in compliance with the good faith clause, and its contents must be set up in such a way that they are considered “fair” by both parties); and
- the right to the promotion and development of free, voluntary and democratic associationism among consumers and users (this right, in essence, translates into the possibility for consumer associations, subject to compliance with certain criteria, to be nationally recognized, financed and allowed to participate in the periodic meetings of the National Council of Consumers and Users, with collaborative functions in the field of consumer and user rights and protections)
- the right to the provision of public services in accordance with standards of quality and efficiency (state and regions guarantee the rights of users of public services through the concrete and proper implementation of the principles and criteria provided for in the relevant legislation; the user relationship must take place in accordance with predetermined and publicly disclosed quality standards; users are guaranteed through representative forms to participate in the procedures for defining and evaluating quality standards; for some public service providers there is an obligation to adopt special service charters).
The warranty (repairs and replacements)
Knowing the basic rights of the consumer is not enough, however, to exhaust the consideration of this intricate subject matter; it is now time, in fact, to introduce the concept of guarantees.
You should know that in Italy, for new goods, there is a legal warranty of 2 years (starting from the delivery of the good). For used goods, on the other hand, seller and buyer can agree on a shorter period, which, however, cannot be less than one year.
During the legal warranty period, in the presence of a lack of conformity, it is provided that the consumer is granted, first of all, the repair or replacement of the good (considered primary remedies) in order to obtain the “restoration of conformity” without charge. In the event that the two primary remedies are not feasible and in the cases provided for in Article 130 of the Consumer Code, the consumer is entitled to request a price reduction or termination of the contract (secondary remedies).
In addition to the legal warranty, manufacturers and sellers may offer consumers a so-called conventional warranty. This warranty is optional and, according to the provisions of the Consumer Code, free of charge to consumers. Once offered, manufacturers and sellers are bound to it in the manner specified in the warranty statement itself or in related advertising.
The right of withdrawal and the right of second thought (returns and refunds)
An analysis of consumer rights cannot be said to be complete if it does not consider another very important right: the right of withdrawal, also known as the right of second thought.
It consists of the possibility for the consumer to change his or her mind about the purchase made, freeing himself or herself from the contract without giving any reasons. In practical terms, this right results in the return of the good and a refund of the amount paid by the consumer.
You should know that consumers can exercise the right of withdrawal only in the case of contracts concluded at a distance or negotiated away from business premises (subject to the exceptions provided for in the Consumer Code). Keep in mind, however, that national rules on the right of withdrawal do not apply to off-premises contracts of less than 50 euros.
There is one final point to consider: the period for exercising the right of withdrawal is generally set at 14 days, but the limitation is extended if the consumer has not been informed of the existence of this right.