1. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Working Group for Chapter 28 – Consumer and Health Protection Bilateral screening: Chapter 28 PRESENTATION OF MONTENEGRO Brussels, 15-16 April 2013

2. Chapter 28: Consumer and Health Protection Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European Parliament and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the European Parliament and of the Council Text with EEA relevance Zvezdan Čađenović Montenegrin Union of Employees zcadjenovic@yahoo.com M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION

3. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Contents Chapter 28: CONSUMER AND HEALTH PROTECTION  Relevant Acquis  National Legislation  Institutional Framework  Level of transposition (key rules)  Enforcement  Future activities

4. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Relevant acquis  Council Directive 85/577/EEC of 20 December 1985 to protect the consumer in respect of contracts negotiated away from business premises, repealed by  Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer rights Chapter 28: CONSUMER AND HEALTH PROTECTION

5. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union  The LCP was adopted by Parliament of MNE in May 2007  The Consumer Rights Directive (have not been subject of transposition measures with 2007 LCP): - adopted in October 2011, - to be transposed by national legislation (adopted and published) by 13 December 2013, - transposition measures to apply from 13 June 2014.  Directive 85/577/EEC (have been subject of transposition) Transposition measures Chapter 28: CONSUMER AND HEALTH PROTECTION Chapter 28: Consumer and Health Protection

6. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union National Legislation  Law on Consumer Protection, OG RMN No. 26/07, aims to ensure a uniform minimum protection of consumers in respect of doorstep sale of goods and services in B2C contracts  Law on Internal Trade, OG RMN, No. 49/08, regulates door-to-door selling (e.g. registration requirement, allows doorstep selling by authorized trader representative, and expands definition who can be cought under term „trader“, thus provides for further compliance with Directive definition of „seller“;  Law on Obligations, OG MN No. 47/08, general contract law applicable in B2B, B2C, B2P, and P2P transactions. Chapter 28: CONSUMER AND HEALTH PROTECTION

7. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Institutional Framework  Beside MoE and Authority for Inspection Surveillance, other main institutions and stakeholders: -Courts, individual complaints, -Arbitration Board for Out-of-court Settlement of Consumer Disputes, ADR scheme for consumer protection Chapter 28: CONSUMER AND HEALTH PROTECTION

8. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules I) Level of transposition: High*  Definitions (Art. 2.[8, 11] LCP and Art. 6 and 17(2) LIT): -Consumer – one definition for whole LCP - natural person who buys, orders, accepts, uses goods or services, including public services, for non-business, namely non-professional purposes, or to whom the offer for a product or service is targeted; -Trader - one definition for whole LCP - a person who sells goods or provides services to consumers (no transposition of wording “in the course of his trade, business or profession”. - yet, Art. 6 of Law on Internal trade that expands definition who can be cought under term „trader“, - while Art. 17 imposeses registration requirement and allows for doorstep sale by authorized representative of the trader; Chapter 28: CONSUMER AND HEALTH PROTECTION

9. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules II)  Definitions (Art. 2.[1 and 16] LCP): -Product shall mean goods or service that may be circulated, including also public service; -Consumer contract shall mean a contract concluded with a consumer or consumer group Chapter 28: CONSUMER AND HEALTH PROTECTION

10. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules III)  General Scope: -LCP provides for specific provisions to protect the consumer in respect of sale of products by contracts negotiated away from business premises (Art. 48 LCP). -LIS requires previous registration of traders for doorstep sale (Art. 17(3)). Chapter 28: CONSUMER AND HEALTH PROTECTION

11. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION DirectiveLCP During an excursion X During a visit by a trader √ To a consumer home or home of another consumer √ To a consumer place of work, without express request of the consumer √ Visit requested by a consumer √ Offers and unilateral legal acts X Contract negotiated in door step situation, but concluded afterwards X Chapter 28: Consumer and Health Protection Level of transposition (Key rules IV) General application (Art. 48 LCP)

12. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules V)  Expanding the list of door step situations/other national variations: -public places - LCP Art. 48 (1) [1] – falls under selling outside business premises (e.g. available to access to anyone such as: streets, squares, parks, beaches, railway stations, airport buildings, internal marine transport facilities, schools etc.) -LCP refers to “products”, thus as a consequence applicable on goods and services, including public services. -Trader identification – when concluding contract trader is obliged to present to the consumer evidence that he is authorised to conclude contracts in door step sale situation (Art. 49 LCP). Chapter 28: CONSUMER AND HEALTH PROTECTION

13. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION DirectiveLCP Option (contracts under 60 €) (Art. 3(1))√ (60 €) construction, sale and rental of immovable property (Art. 3(2) (a)) √ supply of foodstuffs or beverages … intended for current consumption in the household (Art. 3(2) (b)) Partially (no “regular rounds man”) Contract concluded on the basis of a trader's catalogue… (Art. 3(2) (c) (i)) √ Intention to have continuity of contact (Art. 3(2) (c) (ii))Partially (continuity of “business relations” instead of “contract” clear information to consumer of his right to return goods – period not less than 7 days (Art. 3(2) (c) (iii)) √ Insurance contract (Art. 3(2) (d))√ Contracts for security (Art. 3(2) (e))√ Chapter 28: Consumer and Health Protection Level of transposition (Key rules VI) Exemptions provided in Directive (Art. 48 LCP)

14. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules VII)  General principles: -A consumer may not waive the right set out in CPL. -In the case of any conflicts in respect of the interpretation of any provision of CPL, interpretation in favour of the consumers will apply. -Burden of proof - In the case of any disputes about the consumer’s eligibility to exercise the rights set out in LCP pertaining to meeting of a deadline to exercise the right, it shall be deemed that the consumer is eligible in this respect; Chapter 28: CONSUMER AND HEALTH PROTECTION CP Instruments (General Principles) (Art. 5 LCP)

15. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION DirectiveLCP Prior information √ Wright of withdrawal (rescission) √ Written form √ ( paper or electronic) Extension - data on trader, the product subject of the contract, price, date of delivery to the consumer, and other important elements of the contract. Chapter 28: Consumer and Health Protection Level of transposition (Key rules VIII) CP Instruments (Information requirements) (Art. 50 LCP)

16. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Level of transposition (Key rules IX)  Prolongation of rescission period (Art. 51(2) and (3) LCP): -consumer can unilaterally terminate the contract within three months following the date of contract conclusion, if trader failed to meet the information requirement; -7 working days from meeting information requirement if notice was not given immediately but within 3 months from the date of concluding the contract. -C - 412/06, Annelore Hamilton v Volksbank Filder eG [2008] ECR I-02383.  Misdemeanor (Art. 129(1)[16] and (2) LCP): pecuniary fine for offence imposed on a trader, as well as separate one on the responsible person if the trader is legal entity. Chapter 28: CONSUMER AND HEALTH PROTECTION CP Instruments (Sanctions for breach of Information requirement)

17. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION DirectiveLCP At least 7 days√ (7 working days) In accordance with national rules√ (Prolongation of rescission period) Postal rule/Dispatching ruleX Extensions: -right on rescission in case of trader impossibility to execute the contract within 30 days (as in Directive 97/7/EC) -always to be sent in written form. Chapter 28: Consumer and Health Protection Level of transposition (Key rules X) CP Instruments (Right of rescission (withdrawal)) (Art. 51 (1,2,3 and 5) LCP)

18. M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 28: CONSUMER AND HEALTH PROTECTION DirectiveLCP No obligations for consumer under the cancelled contract √ ( stating no reasons and no obligation to compensate the trader for the damage (costs, interests, penalty, and like, except the costs of return the goods. the legal effects of renunciation governed by national laws √ reimbursement of payments for goods or services provided √ refund price paid to consumer within 30 days following the receipt of written notification) return of goods received √ (return goods to trader within 30 days following the forwarding of the notification) Chapter 28: Consumer and Health Protection Level of transposition (Key rules XI) CP Instruments (Effects of rescission (withdrawal)) (Art. 51 (4) and 53 in conjunction with Art. 44, 45, and 46 (distance selling) LCP)

19. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Enforcement I  Authority for Inspection supervision: -Authorised to issue orders toward traders in respect of consumer rights relating to wrong calculation of price (Art. 126(1) LCP) -Initiating misdemeanour procedure in case of infringement of the Law (Art. 129(1) [16], Art. 134 LCP) (fines: 1.000 to 15.000 Euros for legal entity; 150 to 1.500 Euros for responsible person in legal entity; 400 to 4.000 Euros for entrepreneur) Chapter 28: CONSUMER AND HEALTH PROTECTION

20. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Enforcement II  Courts : -individiual complaints; -collective complaints: individual consumer, consumer organizations or other interested parties can submit a complaint with a competent court against individual trader, two or more traders involved in the same economic sector, or traders’ associations, in order to abate the provisions of the contract (pre- formulated contract terms) if these are waiving rights of the consumers in respect of door step sale (Art. 114 LCP).  Arbitration Board for Out-of-court Settlement of Consumer Disputes Chapter 28: CONSUMER AND HEALTH PROTECTION

21. Chapter 28: Consumer Protection and Public Health M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Future plans  ME in 3 rd and 4 th quarter 2010 executed detailed screening of 11 CP directives (including Directive 85/577/EEC), supported by IPA 2009 Project (AIM)  Guidelines for Harmonization of Montenegrin CP legislation (blueprint for new LCP) http://www.mek.gov.me/ResourceManager/FileDownload.aspx?rid=126923&rTy pe=2&file=Guidelines%20for%20Harmonisation%20of%20Montenegrin%20%2 0CP%20Legislation.pdf http://www.mek.gov.me/ResourceManager/FileDownload.aspx?rid=126923&rTy pe=2&file=Guidelines%20for%20Harmonisation%20of%20Montenegrin%20%2 0CP%20Legislation.pdf  Draft new Law on Consumer Protection, fully harmonized with Directive 85/577/EEC and ready to be adopted by GoM (Art. 54– 59 Draft LCP) Chapter 28: CONSUMER AND HEALTH PROTECTION

22. Thank you for your attention. QUESTIONS