I move: "That the Bill be now read a Second Time."
I am delighted to bring before the House today the Consumer Rights Bill 2022. This Bill represents the biggest reform of consumer law in more than 40 years. It consolidates and updates existing legislation on the sale of goods and supply of services to ensure it is fit for the modern digital age. This Bill is the culmination of a significant amount of work in this area to implement recommendations by the sales law review group in 2011. A core focus of my work in the Department is to ensure we have a fair and effective market that works for both businesses and consumers. This Bill does that by strengthening protections for consumers while also creating clearer rules for business.
This Bill has required significant consideration due to its complexity, so I acknowledge the work of my officials, and indeed Deputy Bruton during his time in this Department, in developing this legislation. Not only does the Bill modernise domestic law, it also transposes two EU directives on contracts for the sale of goods and contracts for the supply of digital content and digital services. In addition, it transposes most of another EU directive, namely, the better enforcement and modernisation directive.
The purpose of the Bill is to bring about several positive changes for consumers, including stronger consumer rights, protections and remedies across a number of key areas. For instance, it gives people stronger consumer rights when it comes to how problems with goods or services they have received are resolved, so instead of just exchange, refund or repair, consumers will also be entitled to agree a price reduction on faulty goods and flawed services if that suits them better. They will also be entitled to withhold payment for goods or services that have been partially paid for if they are not satisfied with the quality of the item or service received.
Importantly, this Bill stipulates that any form of redress must be free of charge and must be carried out as soon as possible. The Bill brings together in one statute provisions that are currently contained in diverse pieces of law and some that have never been regulated before. In existing legislation, consumers have no rights to remedies when services are not provided as expected and agreed, for example in areas like legal services, personal care services and building services. The consumer rights Bill closes this gap. It also includes new protections for consumers in relation to digital content, including audio and video files, computer games and digital services, such as streaming services, cloud computing and social media. These new digital rights include the right to a full refund, exchange or repair when a good or service is not as described or not fit for purpose.
Consumers will be entitled to any upgrades to the product or service that is intended to ensure the goods continue to work as expected and as agreed, free of charge. It contains a new blacklist of contract terms and conditions that are automatically deemed to be unfair, and which should not be included in any consumer contract. This includes, for example, where the agreement is only legally binding for the consumer and not for the trader, or where the trader can decide to change the terms of the contract without informing the consumer in advance.
Businesses will be required to set out clearly a description of the goods or services being provided and the total price and costs of delivery before entering into a contract with a consumer. Furthermore, the Bill gives extra enforcement powers to the Competition and Consumer Protection Commission, CCPC, which is the body responsible for enforcing consumer law in Ireland. These new powers mean that where traders engage in misleading and aggressive commercial practices, like posting fake reviews, or where they do not provide the remedies or reimbursement that consumers are entitled to, the CCPC can take action, such as issuing compliance notices or applying to the Circuit Court or the High Court for a declaration or injunction. It will also provide enforcement powers to ComReg in relation to electronic communication services and premium rate services and to the Central Bank with regard to financial services.
In the summer of 2021, I announced a public consultation on the Bill. The response was very positive, with respondents including the Consumers Association of Ireland, the Irish Business and Employers Confederation, IBEC, ComReg and the CCPC providing constructive feedback, which informed the drafting process. The Joint Committee on Enterprise, Trade and Employment held a hearing on the general scheme of the proposed legislation in October of last year. While the committee made no specific recommendations in relation to the general scheme, the rich discussion at the hearing fed into the ongoing drafting process.
The dates given by the Commission for transposing these directives were July 2021 for the sale of goods directive and digital content directive and November 2021 for the better enforcement and modernisation directive. Unfortunately, Ireland, along with several other member states, did not meet these deadlines. As Members can see and as I noted earlier, the Bill is complex and highly technical and it required significant consideration and redrafting. The focus has been to make sure we get it right, even if that meant taking a little more time. I am confident, therefore, that the Bill before the House today is robust, well considered and fit for purpose.
Before I outline the main provisions of the Bill, I would like to take this opportunity to flag my intention to propose a small number of amendments on Committee Stage. This will be necessary to make minor technical alterations, to clarify the intentions of certain provisions and ensure the powers of both the CCPC and ComReg are sufficient for the additional functions they will have as a result of this Bill. It is my intention to bring forward on Committee Stage a technical amendment to section 459 of the Companies Act 2014 to clarify the role of the Minister for Public Expenditure and Reform when holding on trust the unclaimed property of dissenting shareholders who have not sought to claim their property in the seven years following an acquisition.
I now turn to the main provisions of the Bill. This Bill contains 13 Parts and six Schedules. It is important to point out at this juncture that with little exception, Parts 2, 3, and 5 transpose maximum harmonisation directives which give little or no discretion as to their implementation.
Part 1 deals with matters common to legislation, namely, citation and commencement, interpretation, regulations, repeals and revocations. It also contains generally applying provisions relating to the making of contracts, preventing traders from attempting to restrict the rights of a consumer and the jurisdiction of the courts to order remedies.
Part 2 focuses on the rights of consumers under sales contracts and on the remedies available to consumers where goods do not conform to those rights. It gives effect to the sale of goods directive 2019/771 and incorporates the provisions applying to consumer sales contracts in the Sale of Goods Act 1893. It also gives effect to Article 18, delivery of goods, and Article 20, passing of risk in goods, of the consumer rights directive 2011/83, as well as to the delivery provisions at sections 30 and 31 of the Sale of Goods Act 1893. Part 2 also deals with commercial guarantees.
Part 3 gives effect to the digital content directive 2019/770 on certain aspects concerning contracts for the supply of digital content and digital services. Its provisions set out the rights that apply under such contracts and the remedies that apply where digital content or digital services infringe upon those rights. As digital content and digital services are relatively new, consumer contracts for their supply have not previously been the subject of specific statutory regulation.
Part 4 will replace the provisions of the Sale of Goods and Supply of Services Act 1980 that relate to service contracts between a consumer and a trader. It deals with contracts for the supply of non-digital services. It expands the rights of consumers in respect of such contracts and establishes a scheme of statutory remedies that will apply where a service does not conform to these rights.
Part 5 re-enacts, with substantial amendments, the provisions on consumer information and cancellation rights contained in the consumer rights directive 2011/83, as given effect by European Union regulations in 2013. This Part also implements the significant amendments to the consumer rights directive made by the better enforcement and modernisation directive of 2019. As Part 5 deals with key aspects of consumer contract rights, its incorporation into the Bill is in the interests of regulatory clarity and accessibility. Its inclusion in primary legislation also permits the application of some provisions to contracts that had previously been excluded from the scope of secondary legislation. In addition, Part 2 repeats consumer rights contained in the consumer rights directive of 2011 and given effect in the 2013 regulations relating to payment of fees, additional payments, charges for calls to customer helplines and inertia selling, which involves the sending of unsolicited goods to potential customers in the hope of making a sale.
Part 6 makes a number of important changes to the provisions of the European Communities (Unfair Terms in Consumer Contracts) Regulations 1995, SI 27 of 1995, which transposed the unfair terms in consumer contracts directive. As the directive is a minimum harmonisation instrument, member states are free to extend its provisions to excluded terms and to add to the protections it provides. The changes made to the regulations include extending the scope of the unfair terms provisions to include contract terms that have been negotiated between the consumer and trader, strengthening the transparency requirements that apply to contract terms, narrowing the exemption from assessment for unfairness of core contract terms, expanding the grey list of consumer contract terms presumed to be unfair and introducing a blacklist of terms that are automatically unfair.
This Part also gives effect to the new penalties provisions inserted in the directive by the better enforcement and modernisation directive.
Part 7 sets out the enforcement powers and penalties under the Bill. The CCPC will have enforcement responsibilities for consumer contracts under all Parts of the Act. The Central Bank will continue to have an enforcement function under Part 7 in respect of unfair contract terms in consumer contracts with regulated financial service providers. ComReg will have an enforcement function under Parts 5 to 7, inclusive, in respect of consumer contracts for electronic communication services.
Part 8 contains the various amendments to the Consumer Credit Act 1995 required to ensure that the protections and remedies available to consumers in regard to the purchase of goods will be available irrespective of whether the consumer pays the price in a once-off payment or by way of instalments or any other types of deferred payments, for example, hire purchase agreements or other longer-term hiring arrangements.
Part 9 contains the various amendments to the Consumer Protection Act 2007 required to transpose amendments to the unfair commercial practice directive made by the better enforcement and modernisation directive. These amendments will extend and enhance the enforcement measures available to the CCPC.
Parts 10 to 13, inclusive, provide for a number of amendments to other consumer protection-related enactments. Part 10 amends the Central Bank Act 1942, Part 11 amends the Communications Regulations Act 2002, Part 12 amends the Competition and Consumer Protection Act 2014 and Part 13 provides for minor and consequential amendments of enactments.
With regard to the Schedules, Schedule 1 sets out repeals and revocations. Part 1 of Schedule 1 lists the Acts that are repealed. Part 2 of Schedule 1 lists the statutory instruments that are revoked.
Schedule 2 sets out the information to be provided by the trader prior to the conclusion of an on-premises contract.
Schedule 3 sets out the information to be provided by the trader prior to the conclusion of an off-premises or distance contract.
Schedule 4 provides information concerning the exercise of the right to cancel and includes the model cancellation form.
Part 1 of Schedule 5 sets out the list of contract terms that are presumed unfair. Part 2 of Schedule 5 provides for certain restrictions on the application of the first part of the Schedule.
Part 1 of Schedule 6 sets out amendments of Acts. Part 2 of Schedule 6 sets out amendments of statutory instruments.
In conclusion, a comprehensive consolidated consumer rights Act will provide a legislative framework that is more appropriate to present-day conditions and requirements, is simpler to understand, creates clearer rules for businesses and strengthens consumer rights. Therefore, I believe this legislation is good news for consumers. It is equally good news for business because it recognises the behaviours of responsible traders and puts them on a legislative footing, and it also ensures that regulators, like the CCPC and ComReg, have the powers necessary to sanction businesses that do not uphold the standards that this Bill demands. I am confident that, once enacted, this legislation will strengthen protections for consumers, while also creating clearer rules for businesses ensuring the market works fairly and effectively for both. I commend the Bill to the House.