In a recent hotel booking case (Fuhrmann-2-GmbH v B (C 249/21) EU:C:2022:269)) the ECJ held that only the words on the actual online order button, not the ordering process overall, are relevant in assessing whether an online ordering button makes it clear that clicking on it obliges a consumer to pay. The ECJ also stated that wording is only adequate if, both in everyday language and in the mind of the average, well informed, reasonably observant and circumspect consumer, it is reasonably, necessarily and systematically associated with the creation of an obligation to pay.
In this case, a consumer booked hotel rooms at Krummhörn-Greetsiel by clicking on the “complete booking” button. The consumer was then charged a cancellation fee for not using the booking.
The ECJ ruling meant that use of wording “complete booking” on the online order button was not an unambiguous formulation (in line with the requirements under the Consumer Rights Directive) indicating that placing the order entails an obligation to pay the trader.
Online order buttons under the Consumer Rights Directive (“CRD”)
Under Regulation 14(3) CRD, traders must ensure that, when placing their order, the consumer explicitly acknowledges that the order implies an obligation to pay. Under Regulation 14(4) CRD, where placing an order involves pressing a button (or similar function), that button or function must be labelled in an easily legible manner only with the words “order with obligation to pay” or a corresponding unambiguous formulation indicating that placing the order entails an obligation to pay the trader.
The Commission CRD Guidance gives the following examples as likely acceptable:
- buy now;
- pay now; or
- confirm purchase.
The Commission CRD Guidance also gives the following examples as less likely to meet the CRD requirements:
- order now; or
- unnecessarily long phrases that may effectively conceal the message about the obligation to pay.
Interestingly, the Commission CRD Guidance also states, “The respective indication (label) must be on the button itself or immediately next to it. It can be designed in different ways as long as it gives a clear message about the obligation to pay”. The Fuhrmann-2 ruling suggests that this guidance is incorrect.
What this means for businesses selling to consumers online
The Fuhrmann-2 decision, as post-Brexit case law, is not binding on UK courts, although it seems most unlikely that the CMA or English Courts would disagree! Under English law (derived from EU law), all consumer terms must be transparent meaning plain and intelligible. Also, to avoid being struck down for any unfairness, terms relating to what is being sold and pricing must be prominent. In light of this ruling, traders selling to consumers online, really need to ensure their online ordering buttons are totally clear as to the creation of an obligation to pay (and what is to be paid and when). The same applies to cancellation fees. The law makes business sense to us as transparency and prominence engender customer loyalty.