New Common European Sales Law - how will this affect Malta?

Administration Team | Published on 04 Nov 2011

Chetcuti Cauchi Advocates CCMalta default banner

The EU Commission has recently passed draft legislation with the purpose of creating a common sales system within the European Union. The optional Common European Sales Law seeks to harmonise laws of sale within the EU so as to remove private international law issues which often arise in whenever there is a cross border sale. This new draft legislation would effectively help break down trade barriers, thereby minimising legal costs to businesses and consumers since there would not be any cross-border legal issues to deal with and it would also give consumers more choice and a higher level of protection. Furthermore, having a common European sales law would mean having a single set of rules in cross-border contracts and contracts for the sale of goods across all 27 EU member states so that traders would no longer need to struggle with the uncertainties that arise when dealing with multiple and diverse national contract systems.

Advantages for Maltese consumers

On the 11th October, 2011 the EU Comission proposed this optional Common European Sales Law which will facilitate trade by establishing a single set of rules. Therefore, this common contract law will help break down trade barriers and give consumers the same high level of consumer protection throughout the EU. Consumers will also be given more choice and the option to make use of such identical contract law or carry on using their own national legislation. In addition, an information notice will clearly set out the consumers' rights in their own language.

This would prove to be very beneficial to Maltese citizens especially since Malta was recently ranked as the country where people do a lot of their shopping online. As it stands today, people shopping online from a different European country can be refused sale or delivery in their country – this happens to 3,000,000 consumers in Europe and 40,000 in Malta every year. At the moment, 44% of people in Europe say that they do not shop online because they are unsure of their rights. However, the EU Commission has declared that a Common Sales Law would put a stop to this and would boost cross-border trade by removing or substantially decreasing any fears or uncertainties and maximising the benefits for consumers and businesses vis-à-vis eCommerce within the EU. One of the most prominent changes in the proposed legislation is an increased level of protection afforded to consumers.

Maltese Consumers will now be able to rely on the Common European Sales Law as a mark of quality, they will be offered new remedies such as termination of contracts of sale in the case of a defective product, replacement, repair or price reductions, and they will also be able to choose which remedy to avail themselves of. Maltese law states that the consumer would have to notify the seller of any defect within 2 months of its discovery, whereas the Common European Sales Law does not specify a time limit within which to make such notification. Furthermore, Maltese law does not currently offer consumers such freedom when choosing which remedies to use when products delivered are faulty. Therefore, this would be a definite improvement for the Maltese consumer.

Advantages for Maltese companies

“The optional Common European Sales Law will help kick-start the Single Market, Europe's engine for economic growth. It will provide firms with an easy and cheap way to expand their business to new markets in Europe while giving consumers better deals and a high level of protection,” said Vice-President Reding, the EU Justice Commissioner. “Instead of setting aside national laws, today the European Commission is taking an innovative approach based on free choice, subsidiarity and competition.”

Therefore, Maltese businesses exporting to new markets would be able to rely on a comprehensive set of common contract law rules no matter where they would be trading in the EU. Under the proposed legislation, smaller firms would benefit in those cases where businesses impose unfair terms or conditions in a contract which significantly deviate from good commercial practice and are contrary to good faith and such smaller firms would not be bound by them. At present, Maltese law does not provide for such a scenario.

The Commission's proposed legislation is now in the process of obtaining approval from all EU Member States and the European Parliament, which already indicated its support in a vote earlier on this year.

Request More Information

Please send me legal and other updates

Related Industry Groups
Related Practices
Related Opportunities