New Law on Consumer Protection

Just a few months in 2020 were due for consumers to reorient themselves from shopping in stores and shopping centers to online shopping. Up to that moment, the majority of consumers considered shopping online to be “buying a pig in a poke”, and web shopping was a completely unknown and insecure territory. Consumer rights have been proven to be particularly endangered in trade contracts with unregistered “merchants” on the Internet, nonetheless, consumer rights have not been sufficiently respected  in classic trade formats and official web shops either.

An inconsiderable number of conscientious market participants have adopted good consumer dispute resolution practices in the past six years (during the implementation of the previous Law on Consumer Protection). Prevailing number of retailers, however, comfortably use certain ambiguities of the previous law to the detriment of customers’ rights, presuming that most consumers will not prosecute the trader, as an economically stronger party. In that manner, perhaps unknowingly, they turn their consumers into “former consumers”. Satisfied clients will become your best marketing, under the condition that they may expect adequate and legal treatment of customer complaints.

 The new Law on Consumer Protection (“Official Gazette of RS” No. 88/2021) has entered into force. Its implementation begins on December 20, 2021. There is a deadline of nearly 3 months for the market participants to harmonize with its provisions, so this might be the right time to get to know which novelties this law introduces.

From retailer’s aspect, the law introduces a simplified procedure for collecting fines for disobedience of legal norms by right to issue mandatory penalty in the amount of 50.000 dinars to a trader who e.g. fail to introduce the customers with the price of goods, fail to issue an invoice to the buyer, does not inform the buyer about the conditions of purchase on the web shop, fail to hand over to the consumer a form for withdrawal from a online contract, offers sales discounts or promotions opposite to conditions of Law , performs direct advertising without the consent of the consumer (the register “Do not call”), does not receive consumer complaints, fail to respond to complaint within the legal deadline of 8 days, does not return to the consumer the full amount paid under the contract in case of termination (including delivery costs) , does not  accept the consumer’s suggestion to participate in out-of-court settlement of disputes procedure …namely, if he violates the Law in any part.

The possibility to protect your privacy and the right to choose from aggressive business practices is introduced – the register “Do not call”

 The restrain on direct advertising by phone, fax or e-mail is not a novelty of this law, but the introduction of the long-announced “Do not call” register is. This register will contain phone numbers of citizens who do not want to be contacted by traders or service providers with promotional or sales-oriented calls. This register will be kept at the Regulatory Agency for Electronic and Postal Services-Ratel, which updates and publishes the list of consumer telephone numbers, and the trader is obliged to consult this register and restrain from contact to consumer whose number is published in it. Irrespective of the register, each consumer can give consent to an individual trader to inform him about his offers by phone, e-mail or similar means of communication.

For the first time, the law deals with the providers of so-called craft services – the introduction of the obligation to issue an estimate of costs for services

Service providers such as plumber, painter, car mechanic are due to provide their customers with an estimate with specification of the service price for those services exceeding  5,000 RSD. Prior the service providing, the seller is obliged to obtain the written consent of the consumer to the proposed estimate of costs.

If the price is agreed on the basis of the seller’s explicit statement for the accuracy of the calculation, the seller cannot request price increase. If the price is agreed without the explicit statement of the seller for the accuracy of the calculation, the seller cannot request a price increase of more than 15 percent of the estimate. The service provider is obliged to obtain the consumer’s consent to perform additional work, if additional work is necessary, and may perform additional work, if he cannot obtain consumer consent within a reasonable time, only if the cost is negligible.

If the contract stipulates the highest price for the performance of the service, and it is not possible to obtain the consumer’s consent to perform additional work within a reasonable time, the price cannot be increased. The intention of these norms is to finally regulate the craft services in the household, since it has become almost normal to consider agreed deadlines and estimation of costs as a ticket for subsequent price increase without the consent of the client. Craftsmen and providers of these services are thus considered obliged to be familiar with the prices of materials on the market and in a certain way are warned about their expertise – by introducing the obligation to estimate the price of their services in advance.

Out-of-court dispute resolution

The law introduces an obligation for traders to take part in out-of-court settlement of consumer disputes in order to reduce the pressure on courts, in which there are many cases related to consumer disputes. Each trader will be obliged to, before concluding the contract, inform the consumer about the possibility of resolving the consumer dispute out of court and his obligation to participate in that procedure. This procedure will be conducted in a transparent, efficient, fast (up to 90 days) and fair manner before the body for out-of-court settlement of consumer disputes. The list of bodies for out-of-court settlement of consumer disputes will be kept before the competent ministry, and the procedure before the body can be initiated only if the consumer has previously filed a complaint to the trader. Out-of-court settlement of consumer disputes may end with a recommendation on how to resolve a consumer dispute before a competent court, if no agreement has been reached, or by concluding a dispute settlement agreement, which may have the force of an enforceable document if it contains an enforcement clause based on the debtor’s statement. mutually signed. The work of the body for out-of-court settlement of consumer disputes is free of charge for the parties in the procedure.

This is also the time to remind ourselves that a consumer is not allowed to waive the rights determined by this law, and that the contract provision or other statement of will, which directly or indirectly denies or restricts the rights of consumers arising from this law, is null and void.

With this content we had an intention to emphasize the most important differentiations this Law brings, though for some market participants, we believe, the entire Law is an innovation.