En primeur sales now exempt from right of cancellation

Under the new Consumer Contracts Regulations that came into force across the European Union on Friday 13^th June 2014 the statutory cancellation rights for en primeur sales have been clarified.

En primeur sales are now exempt from the right of cancellation providing three specific conditions and one general condition are met:
‘the price has been agreed at the time of the conclusion of the sales contract’, ‘the delivery of which can only take place after 30 days’

‘and the actual value of which is dependent on fluctuations in the market which cannot be controlled by the trader.’
“It is important that all three conditions are met for the exemption to apply,’ says Andrew Park of APP Law*.

This rules out exempting already bottled fine wine from the right to cancellation because delivery can normally take place within 30 days. My guess is that many scam wine investment companies will fail to inform their investors properly of their rights.     

In addition the customer has to be properly informed that en primeur is exempt from the right of cancellation as well as various other pieces of information such as the identity of the trader, the geographical address, telephone and fax number, email address so as to ‘enable the consumer to contact the trader quickly and communicate with him efficiently’, the total price of the goods etc. (Article 6 of the Directive 2011/83/EU). 

This information has to be provided in a ‘durable’ form – print or email. If this information (Article 6 of the directive) is not provided the customer is not  ‘bound by a distance or off- premises contract’.

This could mean that a customer, who had not been properly informed, could still cancel an en primeur contract after delivery (eg two years later) as they were not bound by the contract.   

The en primeur exemption represents a victory for the WSTA, who have campaigned for an exemption since the Distance Selling Regulations 2000 came into force. Before Friday 13^th June 2014 the right to cancel an en primeur order once the customer (or a third party agent is a bonded warehouse) took delivery of the bottled wine had always been a grey area and had never been tested in the courts.

The Consumer Contracts Regulations 2014 implements the EU Consumer Rights Directive of October 2011. There are a number of significant other changes. The right to cancel has been extended from 7 days to 14 days following delivery, which should happen within 30 days of placing the order, unless it is agreed otherwise.

Consumers have to be reimbursed within 14 days. If a consumer is not properly informed of their right to cancel they can cancel up to a year from delivery plus the statutory 14 days. Excessive charges for using a credit card are banned, only the costs involved in using a card can be charged. Premium priced telephone lines cannot be used by customer service centres. 

If a customer has not been properly informed or has been misinformed then the cancellation period from delivery is extended from 14 days to a year plus the statutory 14 days. Previously this had been extended to three months plus the then statutory 7 days.

The new regulations have implications for all companies involved in distance selling. A company’s terms and conditions need to be amended to meet the changes as the consumer is not contractually bound until they have been informed in a ‘durable medium’. 

* Andrew Park APP (http://www.appwinelaw.com) article on changes here. http://www.appwinelaw.com/distance-selling-of-wine-cancellation-period-increased-en-primeur-now-exempted/

Companies wishing to reply on Park's advice need to contact him directly.