PEER Regulatory Round Table on Bundled Products 2nd October 2017 Insights from the PEER event, Cases & Next Steps

Content What is PEER about? PEER Concept PEER Mission and Objectives Important insights from Bundled Products event Examples of Cases (and regulatory solutions) PORTUGAL - Regulatory Guidelines on Bundled Products developed by the ERSE (energy regulator) following electricity being cut due to non-payment of equipment maintenance services THE NETHERLANDS - Regulatory Guidelines on information provision in the energy market developed by ACM (multi-sectoral regulator) PEER’s draft Guiding Principles for Bundled Products Gaps and next steps

What is PEER about? Partnership for the Enforcement of European Rights (PEER) PEER is an initiative of Europe’ s energy regulators (CEER) to enhance inter-agency (cross-sectoral and cross-authority) cooperation at EU level to benefit consumers Started on a pilot basis in 2017 PEER aims to brings together different regulators (telecoms, energy, financial etc.) and other authorities (e.g. Ombudsmen, Consumer Protection Authorities, Consumer Associations, Data Protection Authorities) to strengthen the enforcement of European consumer rights 08/11/2018

Who is PEER collaboration on consumer rights for?

PEER’s Mission and Objectives “To help protect, empower and engage European consumers through the collaboration of relevant authorities with differing consumer-related responsibilities.” Raise awareness of the need for cross-sectoral and cross-authority cooperation Help deliver EU Digital Single Market, Energy and Consumer objectives to benefit consumers PEER Objectives Facilitate the consistent enforcement of consumer rights Share experiences, best practices and develop common approaches

PEER round table on Bundled Products First PEER roundtable (02 October 2017) Bundled products Business model Comparing offers Complaints The round table More than 30 attendees Telecoms, energy and multi sectoral regulators (CEER, BEREC) Consumer bodies (BEUC) Ombudsmen (NEON) European Commission (DG JUST and DG ENER) Interactive with a focus on case studies and sharing experiences 08/11/2018

Important insights on Bundled Products Bundled products are here to stay Product complexity is exponentially increasing. Bundles can create a customer lock-in situation. Bundling is not something the consumer necessarily wants Bundled products are supply driven (pushed by suppliers). Bundled products can cause an accumulation of problems Contractual issues Harder for consumers to compare offers Complaint jurisdictional issues Data management and privacy Competition issues 08/11/2018

The problem Case 1 - Portugal A Portuguese consumer contracted a service with his energy retailer for maintenance services of appliances. After a 6 month trial period, the consumer terminated the maintenance agreement. The Supplier found an error in the bill of the service provided during the 6 months and issued a new bill which the consumer did not pay and was subsequently disconnected. This was counter to Portuguese law which allows an interruption only in the case of non-payment of energy bills, whenever these bills are related to energy supply. The supplier cannot interrupt energy supply due to non-payment of the equipment maintenance service. Steps taken by the energy regulator (ERSE) Supply company was fined €20,000 ERSE developed Regulatory Recommendations for all energy suppliers concerning Bundled or Additional Service Contracts. Since 2016, ERSE requests a copy of all contractual conditions concerning Bundled or Additional Service Contracts. A standard form of pre-contractual information obliges suppliers to identify Bundled or Additional Service Contracts. A revision to the Commercial Relations Code will include a requirement for regular reporting to ERSE on Bundled or Associated Service Contracts.

Case 2 – The Netherlands The problem Lessons Learned ACM (the Dutch multi-sectoral regulator) found, through random checks, that the level of compliance with the requirements on the provision of information was insufficient. Companies understood energy law but not general consumer law. Steps taken by the regulator (ACM) ACM developed guidelines that translate the general consumer protection rules to the practices in the energy sector – these guidelines explained the rules clearly and simply. Lessons Learned General consumer legislation should act as a firm basis as it applies across all sectors. Sector-specific rules can complement but must be consistent with consumer rules. ACM consulted the energy sector on its guidance document. ACM provided a grace period for companies to comply with the rules. ACM learnt that the guidance is very important. Guidelines or rules provide a firm basis for enforcement (which became much more effective).

Lessons learnt Case studies were informative to explore: Challenges and solutions Guidelines used to solve some of the issues Examples of effective cooperation Case studies showed that: Regulators in different sectors face similar challenges More and more overlap between sectors will develop over time Cooperation between consumer authorities and sectoral regulators is key 08/11/2018

PEER Guiding Principles for Bundled Products (draft*) *initial thoughts not agreed by event participants but randomly voiced during the 02.10.17 PEER roundtable Consumers need rules that are easy to understand and compare. There should be consistency in terms of definitions in the contract, offer and bill. Simplicity The consumer should not have to face a multitude of different actors for the different elements of the product. Clear information about the service provider and complaint handler should be mandatory. This should be the case even where the provider is acting as a broker/intermediary. Single point of contact There must be price transparency on different elements of the bundled products, which is reflected in the bill, in identifying the other contacting parties and the terms and conditions of the different elements of the bundled product. Bundled services should offer the consumer the option of separate payments. Transparency is key In the case of multiple contracts of the bundled products. Clear liability principles

PEER Guiding Principles for Bundled Products (draft*) *initial thoughts not agreed by event participants but randomly voiced during the 02.10.17 PEER roundtable In terms of unfair commercial practices Companies must adhere to due diligence should equally apply in the case of bundled products Good guidance principles for price comparison tools This should include the conditions to end the contract or individual elements of the contract Conditions about the right to switch out of any individual element of the bundled product. Suppliers should provide this information upfront and also during the contract when the customer asks for it. Consumer should be well informed of contract conditions in the event of non-payment of another element of the bill of a bundled product. No disconnection of essential service (e.g. energy) In the case of a dispute on a bundled product, there should be low or no fees for the customer to engage in Alternative Dispute Resolution (ADR). No dispute resolution fee

Gaps identified Raising awareness of the need for cross sectoral collaboration, including reaching out to Consumer Protection Authorities, Data Protection Authorities etc. The need for Explanatory notes/Guidelines on the treatment of Bundled Products under the Unfair Commercial Practices Directive. The need for training for sectoral regulators on general consumer law and the treatment of bundled products. The need to map, across EU Member States, the different sectoral regulatory authorities and other authorities. This will identify gaps and overlaps.

PEER to PEER collaboration Next Steps Bundled Products - Inform European Commission of the gaps identified and seek to work with the Commission on follow up (e.g. Explanatory Notes/principles for bundled products, training and mapping) - sharing of case studies - sharing of guidelines PEER to PEER collaboration - Raise awareness of the need for PEER collaboration to benefit consumer rights enforcement - PEER online platform for Event Proceedings, Case Studies and Guidelines - Future PEER events

Further information on PEER www.ceer.eu