October 9, 2008

European Cross-Border Shopping Shake-Up Aimed at Boosting EU Sales

Consumers shopping across European borders are to get sweeping new rights and guarantees under plans unveiled in Brussels yesterday.

The European Commission is asking EU governments to introduce legislation to boost confidence in buying goods and services in other member states, either when travelling abroad or online.

EU Consumer Affairs Commissioner Meglena Kuneva said she is acting because cross border shopping is a vast potential market which is unfulfilled because of public suspicions about the risks.

Her proposals, approved by the Commission and now to be submitted to EU government ministers, will guarantee clear price information and extra charges, offer protection against late delivery or non- delivery, as well as clarifying rights to refunds, repairs and cooling-off periods when buying or ordering goods.

The plans amount to an overhaul of existing consumer rights directives, with simplified, standard requirement in 27 countries. The move will also trigger a drastic cut in red tape which the Commission says is holding back business within national borders.

"With household budgets under strain and purchasing power at the top of citizens' concerns, it has never been more important for consumers to be able to compare prices and shop around to get the best value on offer," Ms Kuneva said.

"These new rules are designed to strengthen protection and close the loopholes in key areas where consumer trust is being undermined."

Only about on in four or 27 pr cent, of shoppers are currently prepared to buy goods online across borders according to figures which have shown virtually no growth in the internet crossborder sector since 2006. That figure would be much greater, said Ms Kuneva, if shoppers and retailers alike were more confident in using the internet to do business.

At the moment about 75 per cent of retailers only sell to domestic consumers, but a consumer report out last week suggested that if sales and after-sales service rules were standardised across the EU for online shopping, about half of those retailers would be interested in selling cross-border.

The Commission points to major retail savings to be had if consumers had confidence in using the internet to take full advantage of the EU single market to ship around in 27 countries.

There are huge price differences, for instance in clothing, furniture, electronics and cars.

The average cost of furniture is 59 per cent higher in Italy, the UK and Ireland than in lowest-price Romania says the Commission.

Lithuania has the biggest bargains in consumer electronics, while Austria is the most expensive, at about 34 per cent more on average than Lithuania.

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