Legal situation for contracts in the consumer sector 

10.12.2021

On January 1, 2022, the legal situation for contracts in the consumer sector will change fundamentally. The "Warranty Directive Implementation Act (GRUG)" implements the so-called "Goods Sales Directive 2019/771 (WKRL)" and the "Digital Content Directive 2019/770 (DIRL)". These directives essentially follow the so-called "full harmonization principle" (i.e. the content of the directive's requirements must be adopted into Austrian law in a congruent manner); deviations from Union law are only possible within narrow limits. Unlike with "minimum harmonization", member states may not deviate from the level of protection stipulated by Union law in favor of consumers. The disadvantage of this principle is a very extensive binding to the Union legislature, the advantage is a congruent implementation throughout the Union. The implementation took place in the Consumer Protection Act and through the enactment of a new "Consumer Warranty Act (VGG)". 

The new legal situation applies to contracts concluded from January 1, 2022, and applies to consumer transactions for the purchase of goods or the provision of digital services, in each case against payment or in return for the provision of the consumer's personal data. Excluded from this are the purchase of live animals, non-digital services, certain electronic communication services, and health, gambling and financial services (Section 2 VGG). According to Section 3 VGG, the new legal situation cannot be deviated from to the detriment of the consumer, so as classic consumer protection law it is "relatively mandatory law". 

A new definition of defect is introduced, according to which (Section 4 VGG) an entrepreneur must guarantee to the consumer that the goods or digital services provided to the consumer have the contractually agreed properties and also have the objectively required properties. In addition, the entrepreneur must also ensure that any obligation to update is fulfilled. It is essential that, regardless of whether the contractually agreed properties are present (these are defined in Section 5 VGG), all objectively required properties must also be present (in addition) - according to Section 6 Paragraph 2 VGG, the goods or digital services in question must therefore

  • be fit for the purposes for which they are “usually“ (Section 6 Paragraph 2 Number 1 VGG),
  • any product samples (Section 6 Paragraph 2 Letter 2 VGG) or, where applicable, any test versions (Section 6 Paragraph 2 Item 3 VGG),
  • to be equipped with the accessories that can reasonably be expected (Section 6 Paragraph 2 Item 4 VGG), and
  • in terms of their quantity, quality, durability, functionality, compatibility, accessibility, continuity, security and other characteristics, correspond to what is usual for such goods or digital services and/or can reasonably be expected by the consumer (Section 6 Paragraph 2 Item 5 VGG).

The current consumer warranty law thus goes far beyond the general definition of defects in the ABGB, according to which an item is defective if it does not correspond to the contract, i.e. does not have the agreed or usually assumed properties (Section 922 ABGB). 

Furthermore, the presumption of defectiveness at the time of delivery or provision is extended to a period of one year; in the case of continuous digital services, the contractor bears the burden of proof of freedom from defects throughout the entire "Provision period“. In conjunction with the newly introduced updating obligation of Section 7 VGG, according to which the entrepreneur must also carry out those updates that are necessary, “so that the goods or digital service continue to comply with the contract”, This represents a significant expansion of corporate obligations. 

As a warranty remedy, the entrepreneur will continue to have the option of remedying the defect (i.e. restoring the defect-free condition), although for the first time the consumer will be able to choose between (the primary "remedies") improvement or replacement when it comes to goods. When providing digital services, on the other hand, the entrepreneur must decide how to provide a warranty. 

The warranty period is also fundamentally changed in its conception and is now defined as the period during which the defect "emerge“. In the area regulated by the law, it should be two years (or, in the case of ongoing digital services, the entire provision period!), whereby the warranty period (and this is also new) is now followed by a 3-month limitation period, within which either a lawsuit or (if the entrepreneur has already claimed the purchase price in court) the assertion of an objection by notification to the entrepreneur must be made. This will also apply in general warranty law in the future, which is why legal remedies will be extended in favor of consumers. 

The new consumer warranty law is determined by EU law and brings a significant improvement in the legal position of consumers. Due to the novelty of the concepts (in particular the concept of defect), there will have to be a large number of court decisions dealing with the new consumer rights in order to clarify open questions of interpretation.

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