In the March legal circular, we will examine in more detail the judgment of the Court of Justice of the European Union in the case of Verein für Konsumenteninformation v Amazon EU Sàrl (C-191/15) (hereinafter the “judgment”). From the perspective of doing business on the internet, the judgment is particularly interesting in two areas. Firstly, the judgment addresses the question of the trader’s obligation to inform regarding the applicable law in cases of concluding contracts via the internet with consumers resident in a Member State other than that in which the trader is established. In this regard, the judgment follows on from the information in legal circular no. 10/2009, in which we addressed the question of which (applicable) law will govern a cross-border contractual relationship in a situation where a Czech trader doing business on the internet sells goods to a consumer abroad, or to a Member State of the European Union. The second interesting question addressed in the judgment is the issue of applicable law in the area of personal data processing, that is, which national regulation in the area of personal data protection will apply if an internet trader directs its business activities also to the territory of another State.

In the practice of Czech traders too, contracts are concluded with consumers who have their residence in a Member State different from the country of origin of the trader. As we learn from the judgment in question, a problem may arise in a situation where a Czech trader concludes contracts with foreign consumers and states in its general terms and conditions that the applicable law, i.e. the law which will govern all contractual relationships with the customer, is exclusively the law of the Czech Republic. The trader is, of course, entitled to choose the applicable law by which the contract with the consumer will be governed, in accordance with Article 3(1) of the Regulation on the law applicable to contractual obligations (known as “Rome I”). However, one must not forget the provision of Article 6(2) of this Regulation, which stipulates that as a result of this choice of applicable law “the consumer may not be deprived of the protection afforded to him by provisions that cannot be derogated from by agreement under the law which, in the absence of choice, would have been applicable on the basis of paragraph 1.” In accordance with this provision, the consumer must not be deprived of protection, or must not be provided with a lower level of protection than that which is guaranteed to him by the mandatory (imperative) provisions of the law of the Member State in which the consumer has his habitual residence.

The judgment in question then addresses the question of informing the consumer regarding this matter, namely in the context of transactions with consumers who have their (habitual) residence in a Member State other than that in which the trader’s registered office or establishment is located. In the opinion of the Court of Justice of the European Union, it holds that a trader who expressly stipulates in the general terms and conditions that only the applicable law chosen by him will apply to the relationship with the consumer “misleads the consumer by giving him the impression that only the law of that Member State will apply to the contract, without informing the consumer that, pursuant to Article 6(2) of the Rome I Regulation, he enjoys the protection afforded to him by the mandatory provisions of the law that would have been applicable in the absence of such agreement.” This means that if a Czech internet trader intends to sell goods, for example, to Polish consumers, he should fulfil the obligation to inform in the sense that in addition to the chosen applicable Czech law, those provisions of Polish law which give the consumer a higher degree of protection than the provisions of Czech law give him will also apply to the rights and obligations of the parties.

As mentioned above, the Court of Justice of the European Union in the judgment also addressed the issue of applicable law in the area of personal data processing. The judgment states that “the processing of personal data carried out by an electronic commerce undertaking is governed by the law of the Member State to which that undertaking directs its activities, provided it is established that that undertaking processes the data in question in the context of the activities of an establishment located in that Member State.” If an establishment (collection point) of a trader with its registered office in the Czech Republic is located on the territory of another EU Member State, and if it is established that the trader also processes personal data in the context of the activities of this establishment, the applicable law is the law of the Member State to which the Czech trader directs its activities, and not Czech law. Thus, the Czech trader must also comply with the requirements of the regulation of such Member State.

Lucie Šedivá

Law Office Mašek, Kočí, Aujezdský www.e-Advokacie.cz – on-line legal advice

This text was originally prepared by the law office Mašek, Kočí, Aujezdský in cooperation with the Association for Electronic Commerce (APEK) as legal circular no. 3/2017 intended for members of this association.

This text was translated from Czech to English using an AI translator.