New Regulations Applicable to Contracts for the Sale of Goods and Contracts for the Supply of Digital Content and Digital Services

New Regulations Applicable to Contracts for the Sale of Goods

Romania
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As part of the Digital Single Market Strategy established at EU level, in the last days of year 2021, the Romanian Government approved two important pieces of regulatory acts in the consumer protection field, which transpose the corresponding European Directives.

  • Government Emergency Ordinance no. 140/2021 on certain aspects concerning contracts for the sale of goods (“GEO no. 140/2021”), which was published in Official Gazette no. 1245/31.12.2021 and entered into force on 1 January 2022;
  • Government Ordinance no. 2/2021 on certain aspects concerning contracts for the supply of digital content and digital services (“GEO no. 141/2021”), which was published in Official Gazette no. 1248/30.12.2021 and will enter into force on 9 January 2022.

The two above-mentioned normative acts concern mainly contractual relationships between merchants and consumers, with the main objective of ensuring a high level of consumer protection and increased legal certainty in the context of current technological developments.

(1) Scope and purpose of the new regulations

GEO no. 140/2021 and GEO no. 140/2021 complement each other and do not overlap in terms of their scope. Thus:

  1. GEO no. 140/2021 applies to sales contracts concluded between sellers and consumers for any category of movable items, including water, gas and electricity, where they are put up for sale in a limited volume or a set quantity, but also to any items that incorporate or are inter-connected with a digital content or a digital service, so that the absence of that digital content or digital service would prevent the goods from performing their functions (the so-called ‘goods with digital elements’);
  2. GEO no. 141/2021 shall apply to those contracts under which the merchant supplies or undertakes to supply the consumer with digital content (i.e., computer programs) or a digital service (i.e., social media), and in return the consumer (i) pays or undertakes to pay a price or (ii) with certain exceptions, provides or undertakes to provide personal data to the merchant. The requirements set forth under GEO 141/2021 shall also apply to any tangible medium, such as DVDs, CDs or USB sticks, provided that it serves exclusively as a support for the digital content.

(2) The main regulated aspects

Although different in their scope, with certain particularities, the two pieces of legislation set out similar rules applicable to contracts for the sale of goods and the supply of digital content and services, in particular on issues related to:

  1. Compliance of the goods, the digital content or the digital service respectively, with the contract. In order to establish compliance with the contracts concluded with consumers, the two ordinances require that the goods, the digital content or services, respectively, covered by them comply with certain objective and subjective conformity requirements, which are presented in detail and have an almost identical content.
  2. The contractual liability of the seller, merchant respectively. Given the different situations that require the applicability of the two ordinances, a certain distinction is necessary between:
  • The seller’s liability under contracts for the sale of goods. According to GEO no. 140/2021, the seller shall be liable to the consumer for any non-conformity that exists upon goods’ delivery (including goods with digital elements) and which becomes apparent within two years from the date of delivery. In particular, in the case of goods with digital elements for which the sales contract provides for the continuous supply of digital content or digital services over a certain period of time, the seller shall also be liable for any non-conformity of the digital content or digital service that occurs or becomes apparent (i) within two years after the delivery of the goods with digital elements (for products with an average service life of up to five years, and (ii) within five years from that date for products with an average service life of over five years. Moreover, the seller shall be liable for any such non-compliance for the entire period during which the digital content or service is to be ensured, if the contract provides for its continuous supply for a period of more than five years.

Non-compliance with the provisions regarding the seller’s liability shall be sanctioned with a fine ranging between RON 5,000 (approx. EUR 1,000) and RON 25,000 (approx. EUR 5,000).

  • The merchant’s liability under contracts for the supply of digital content or digital services. The merchant shall be liable for any non-conformity existing at the time of supply and which is identified within five years from the date of supply, in the case of contracts with a single act of supply or a series of individual acts of supplies. In addition, where the contract provides for continuous supply during a certain period, the merchant shall be liable for any non-compliance which occurs or is discovered within the time limit during which the digital content or digital service must be provided under the contract.

Non-compliance with the provisions regarding the merchant’s liability shall be sanctioned with a fine ranging between RON 10,000 (approx. EUR 2,000) and RON 40,000 (approx. EUR 8,000).

c. Remedies for lack of conformity. Both GEO no. 140/2021 and GEO no. 141/2021 set forth certain specific conditions under which consumers will be entitled to have the goods, digital content or digital service respectively, brought into conformity, and also, where such non-conformities persist, to receive a proportional reduction in price or to terminate the contract. In particular, GEO 141/2021 details the obligations imposed on merchants and consumers in the event of contract termination, such as the merchant’s obligation to refrain, with certain exceptions, from using any content other than the personal data that has been provided or created by the consumer when using the digital content or digital service provided, as well as the consumer’s obligation to return, if applicable and at the merchant’s request, the tangible medium on which the digital content was provided.

d. Specific aspects regulated under GEO 141/2021 - modification of digital content or service. GEO no. 141/2021 allows merchants to significantly modify the digital content or service covered by a supply contract concluded with consumers, but only if the following conditions are cumulatively met:(i) the contract must allow for and also justify such a modification, (ii) no additional costs are to be imposed, (iii) consumers must adequately and previously be informed about such modifications, and also about their right to terminate the contract if the modification has a significant negative impact on the consumer's access to or use of the digital content or services.

3) Mandatory nature

Market participants may not insert clauses into the contracts for the sale of goods, the supply of digital content and digital services respectively, that would in any way preclude the application of the provisions of GEO 140/2021 and GEO 141/2021, derogate from such provisions or change their effects. However, they will still have the possibility to offer consumers contractual arrangements that go beyond the protection provided under these regulations.

By Andra Gheorghe, Senior Associate, Madalina Arcana, Associate, Bondoc si Asociatii