Consumer Ombudsman Päivi Hentunen made public her six theses on improving the position of consumers the 24th of October in 2013.
The Consumer Ombudsman has a vantage point over problems confronting consumers on the market. There is considerable variation in the reasons for the contacts. However, certain basic problems which recur in the messages can be found in the background. The Consumer Ombudsman has encapsulated these problems into six theses for the improvement of the lot of consumers.
1. Consumers must be allowed to move around freely on the market.
Consumers must have a choice. Comparable and clear information must be provided on the alternatives on offer before a contract is concluded. Free movement also means that consumers must be able to easily get out of a contract if needed. Long fixed-term contracts, complicated cancellation procedures, unreasonable cancellation charges and bundling of services make this more difficult.
Issues relating to free movement have recently arisen with regard to communication services, credit agreements and gym memberships in particular.
Businesses strive to safeguard their own freedom of movement in the changing marketplace and even sometimes look for loopholes in their existing contracts. The problem is that businesses often change their terms and conditions without respecting the principles of consumer rights.
2. Essential services to consumers must be guaranteed.
Essential services must be guaranteed for everyone, and businesses must not introduce unnecessarily complicated procedures: banking services must be easily accessible, online banking codes must be given to those who need them and a wide range of payment options must be made available. Bad credit history alone cannot render a consumer ineligible for services such as home insurance.
Businesses must cater for different kinds of consumers: some consumers need more protection than others. The Consumer Ombudsman believes that Finland could set an international example of efficiency while ensuring that no consumer group is excluded from the market.
3. Advertising must be recognizable as such.
Consumers have the right to know when attempts are being made to influence them commercially. This requirement concerning the recognizability of marketing applies to all forms and channels of marketing, including social media. The Consumer Ombudsman has already addressed issues relating to blog advertising and advertorials. Subliminal advertising is also prohibited online.
The authorities and businesses still need to work harder to find and promote efficient practices and rules. The aim must be to ensure the recognizability of advertising in its new forms as well.
4. Companies must put their customer service into shape.
The customer service practices of some sectors do not currently adhere to the law. Consumers have the right to benefit from customer service after making purchases and signing contracts. Businesses have a responsibility to provide customers with information about their rights, such as how to correct errors in billing or rectify defects in goods and services, and to process complaints within a reasonable period of time.
If a business markets its goods and services via a Finnish website, customer service must also be available in Finnish. The same applies to telesales: customer service must be available in Finnish if telemarketing calls are made in Finnish.
The status of children as consumers deserves special attention. Establishing the identity of contractual partners is especially important in the context of digital services and even more so when the consumer is a minor.
5. Collaboration against fraud must be made to work.
Today’s consumers have access to a global range of products and services, but they are also more vulnerable to scams and inappropriate marketing than ever before. It is difficult to intervene in the practices of businesses that are based abroad.
Online scams are a form of crime, and the problem cannot be solved solely by educating consumers. More international cooperation is needed between supervisory authorities, and new forms of cooperation need to be developed among national parties.
Businesses must accept their responsibility and pay attention to who they work with and whom they choose as their partners for services such as debt collection.
6. The sanctions of the Consumer Protection Act must be brought up to date.
The Consumer Ombudsman’s means to intervene in violations are limited and outdated. More versatile and faster ways to deal with violations would benefit not only consumers but also businesses, as they would allow for troublemakers to be eliminated from the market more quickly.
It is time to implement the objective laid down in the 2012–2015 Consumer Policy Programme: to update the range of means available to the Consumer Ombudsman. According to the Consumer Policy Programme, the Consumer Ombudsman needs to be able to “intervene more efficiently and more quickly in short-term, potentially consecutive inappropriate marketing campaigns and other business practices that reflect an indifferent attitude towards consumer protection regulations”. The Ministry of Employment and the Economy is looking into the matter.
The Debt Collection Act already lays down a principle according to which any injunction imposed by the Consumer Ombudsman remains in force unless the business concerned refers the case to the Market Court. More extensive use needs to be made of this principle. This would minimise the adverse effects of illegal activities on consumers and other businesses and shorten processing times. Injunctions that carry a sufficiently large fine would discourage businesses from reoffending.
The Consumer Ombudsman also needs to be able to impose penalty payments on businesses that have broken the law as soon as a violation is discovered. The nature and amount of each penalty payment would be determined by a court. Competition authorities, the Financial Supervisory Authority and the Finnish Communications Regulatory Authority are already able to impose sanctions such as penalty payments and market disruption fines. The Swedish and Norwegian consumer ombudsmen also have recourse to these kinds of deterrents.
The Consumer Ombudsman has matters pending for all of these theses, connected with, for instance, influencing legislation, policy lines or policy solutions linked with consumer law, as Market Court applications and as warnings directed at consumers.
The Consumer Ombudsman works hard for the implementation of these theses, and directs activities and resources in the coming years accordingly, in addition to solving acute market problems.