Finnish Consumer Ombudsman is seeking an injunction from the Market Court to prohibit a procedure under which Mezzoforte, the company operating the online store Huutokaupat.com is denying consumers the right to cancel distance selling contracts made online. The Consumer Ombudsman demands that the Market Court should impose a penalty payment of EUR 100,000 to reinforce the prohibition.
Huutokaupat.com, which is operated by Mezzoforte, is a Finnish online platform where both Mezzoforte and other operators sell items to private individuals. Mezzoforte is the seller in transactions that are made in accordance with the terms and conditions of Huutokaupat.com. The items on sale, such as used cars, are sold to the customer making the highest bid by a specific deadline. The person making the highest bid undertakes to purchase the item at the price that they have offered. Under the company’s terms and conditions, consumers do not have the right to cancel the contract.
The Finnish Consumer Ombudsman and Mezzoforte have held discussions on the company’s operating practices. Mezzoforte has, contrary to the position of the Consumer Ombudsman, interpreted that its practice is in accordance with Finnish Consumer Protection Act, and for this reason, the Consumer Ombudsman is taking Huutokaupat.com to the Market Court and demanding the Market Court impose a penalty payment of EUR 100,000 to reinforce the prohibition. The application submitted by the Consumer Ombudsman only concerns the transactions made in Huutokaupat.com in which Mezzoforte purchases items from their previous owners and sells them under its own name to consumers in the online store.
In the Consumer Ombudsman’s view, the transactions concluded in Huutokaupat.com are distance selling contracts referred to in the Finnish Consumer Protection Act. Under the Finnish Consumer Protection Act, consumers have the right to cancel a distance selling contract within 14 days because in distance selling the customer cannot check the items before the purchasing decision. There are a few exceptions in which the consumer does not have the right to cancel purchases made in distance selling. The Finnish Consumer Ombudsman and Mezzoforte disagree on whether the sales practices used by Mezzoforte should be considered a public auction referred to in the Finnish Consumer Protection Act to which a limited right to cancel a distance selling contract applies or to which the right does not apply at all.
Consumer Ombudsman demands that Mezzoforte should correct its marketing practices
The Market Court may oblige the trader subject to the prohibition to correct its marketing practices. The Consumer Ombudsman proposes that after the decision of the Market Court, Mezzoforte should be obliged to notify the consumers that have purchased items in Huutokaupat.com that the company has, in violation of the Finnish Consumer Protection Act, denied its customers the right to cancel distance selling contracts.
The correction should be issued in Huutokaupat.com, and in the newspaper Helsingin Sanomat and by email, text message or by other personal means. In connection with the correction, Mezzoforte should also provide its customers with information on their right to cancel a contract and its deadlines, and instructions on procedures. The Finnish Consumer Ombudsman demands that the Market Court should impose a penalty payment of EUR 500,000 to reinforce the claim.
The Consumer Ombudsman is demanding the correction because a large number of purchases are made in Huutokaupat.com every year and the right to cancel a contract is an important consumer right. From the perspective of consumer protection, it is extremely important that the customers are informed that they have received incorrect information on their right to cancel a distance selling contract. The customers in whose case the deadline for cancelling the purchase has not yet expired should be notified of the correction. Consumers have the right to cancel a contract for one year from purchase if the company has failed to provide the information referred to in the Finnish Consumer Protection Act.