FREEDOM TO PROVIDE SERVICES IN THE INTERNAL MARKET AND CONSUMER PROTECTION
FREEDOM TO PROVIDE SERVICES IN THE INTERNAL MARKET AND CONSUMER PROTECTION

Summary/Abstract: In DSIM, which is another big step toward ensuring freedom to provide services in the internal market, consumer protection is regulated the other way than we could have expected if DSIM had taken into account the complete case law of the ECJ. In some DSIM chapters, consumer protection is not mentioned and DSIM does not interfere with it either (e.g., regarding the contractual provisions in the consumer relationship between consumers and retailers). The Directive does not change the legislator's views on the protection of the consumer as a person who alone is responsible for the decision on conclusion of a long-term legal transaction based on sufficient information the consumer gets from the retailer. It can also be ascertained that the case law regarding the exceptions justified by overriding reasons relating to the public interest, such as consumer protection in view of exceptions to freedom of establishment, is not changed. DSIM follows the rules drawn up by the case law of the EG. In the area of all the four types of freedom to provide services (i.e., when it is not about the freedom of establishment for service providers), DSIM has enacted the country of origin principle that is restricted and weakened where it is possible to invoke consumer protection merely on the grounds set out in Article 18 of DSIM. That is to say, the overriding reason is safety of services. In addition to this reason, if it exists, it is necessary to carry out the procedure laid down in Article 35 of DSIM, and to call on the Member State of establishment to take appropriate measures that will assure adequate safety of services. This is possible only in those cases where no harmonisation rules have been adopted at the Community level regarding the safety of an individual service, and only in the case if the measure, required by the state where the service is provided, would contribute to greater safety of services. At the same time, the Member State of establishment has not taken such a measure or does not require it, and in any case, greater safety requirements, imposed by the Member State where a service is provided, must be proportionate. Thus, the supervision duty (along with the rules on cooperation between the competent bodies of the Member States) is delegated to the country of establishment or origin even when it comes to providing services in the host Member States. But on the other hand, this means weakened supervision efficiency offered by the Member States where the service is provided. In this case, the rules on the mandatory professional liability insurance and on the information, which the provider must give to the service recipient irrespective of whether or not the recipient requests it (and other rules listed above, and which are in favorem consumatoris), partially mitigate and compensate for the country of origin principle that is weakened, and for the supervision efficiency weakened by the Member States where the service is provided. From an overall point of view, all Member States are thus gaining and losing because they will find themselves in the role of the Member State of establishment or origin as well as in the role of the country where a service is provided. Hence, the countries which have stricter consumer protection standards will be losing more in comparison with those having less strict standards. That is to say, in order to assure safety of a certain service, the countries in the first group will have to carry out the cooperation procedure laid down in Article 35 of DSIM, and they will have to warn the country of establishment with less restrictive consumer protection provisions to take (in the event of a specific provider) stricter measures to assure safety of the service in another Member State. One can easily imagine that this will not be easy. It may occur that the country of establishment will not have a legal basis in its legislation to be able to ask such a service provider to take a certain measure requested by the competent body in the host Member State. Only in this case, i.e., with a certain delay time, the country will be able to introduce this measure for the specific service provider.

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