Amendment to the Consumer Protection Act: More rights for consumers, more obligations for entrepreneurs

On 1 February 2016, an amendment to the Consumer Protection Act took effect. The amendment particularly introduces out-of-court resolution of consumer disputes. Until February, if consumers felt that their rights were affected, they could only resolve their disputes before court. Now, however, they may turn to the Czech Trade Inspection Authority or another state-authorized entity that is supposed to lead both parties to reach an amicable settlement of the dispute.

Although the entrepreneur is not in any way obliged to accept the settlement, it must provide the authority with necessary assistance, especially hand in the required documents and information. If a settlement is not reached within 90 days, the proceedings are terminated and the consumer may only use the traditional judicial way.

Furthermore, a new information duty for the entrepreneur has been introduced: the entrepreneur is obliged to ensure that the consumer is informed about this method of dispute resolution – in an easily accessible and understandable form, including a link to the website of a competent authority. This information must always be compulsorily published by the entrepreneur on its website and included in its business terms and conditions. If the dispute cannot be settled directly, the consumer must be informed in paper form or through another durable data medium.

The business terms and conditions must be adapted within 3 months. Breaches of the obligations specified above will be subject to fines of up to CZK 1 mil. 

 

Consumer Protection Act amended, providing more rights for consumers, but more obligations for entrepreneurs

Effective since 1 February 2016, the new amendment to the Consumer Protection Act introduces, among other things, out-of-court resolution of consumer disputes. Consumers that believed that their rights were affected could previously only resolve their disputes before court, but now they may turn to the Czech Trade Inspection Authority or another state-authorized entity that should help both parties to reach an amicable settlement of the dispute.

Although entrepreneurs are not obliged to accept the settlement, they must provide the authority with necessary assistance, especially submit the required documents and information. In the event that a settlement is not reached within 90 days, consumers must resort to the traditional judicial way.

In addition, a new information duty for entrepreneurs has been introduced: entrepreneurs must ensure that consumers are informed about this method of dispute resolution in an easily accessible and understandable form, including a link to a competent authority’s website. This information must always be published by entrepreneurs on their website and incorporated in their business terms and conditions. If the dispute cannot be settled directly, consumers must be informed in paper form or by means of another durable data medium.

The business terms and conditions must be amended accordingly within 3 months. Violations of the above obligations will be subject to fines of up to CZK 1 million.