Changes in online dispute resolution, obligation of co-operation remains

Ministry of Innovation and Technology to provide information and help in online consumer dispute resolutions

Changes of Law:

On the 1st of September, 2019 amendments to Act CLV of 1997 on Consumer Protection entered into force, resulting in three main changes in the area of consumer protection:

  1. In Hungary it will be the Minister of Innovation and Technology who will be the contact person relating to online disputes in line with Regulation no. 524/2013 of The European Parliament and of The Council on online dispute resolution in consumer disputes. The Minister provides assistance for applications filed through the online dispute platform to resolve consumer complaints.
  1. The provisions of settlement in consumer disputes will be changed in connection with online cross-border sale and purchase contracts. Additionally, the jurisdiction of the Metropolitan Conciliation Board in consumer disputes will be terminated. Instead, conciliation boards operating at the county (Metropolitan) and capital chambers of Commerce and Industry will have competence in these matters.
  1. Finally, the requirements as to the procedure for selecting members of conciliation boards have changed as well. Membership of a conciliation board can be filled by tender and the appointment lasts for three years. At the time of establishing conciliation boards, up to half the members of the board may be filled by those who have reached the standard retirement age

A board member who has a degree in law or who has a higher education qualification will act alone in a consumer dispute unless the complexity of the matter requires a three-member board.

The obligation of cooperation:

Note: the above amendment does not change the existing obligation for companies to cooperate in conciliation proceedings, which in turn includes two obligations. Companies are required on the one hand to send a detailed response to a request from a conciliation board and to declare their submission to its competence, and, on the other hand, to appear before the conciliation board and to ensure the presence of someone entitled to enter into a settlement with the consumer.

In the event of a breach of the duty of cooperation, the conciliation board may, in any event, impose a fine on the company. The basic rate of the fine can be between HUF 15,000 – HUF 500,000 for SMEs and HUF 5,000 for non-SMEs. The fine will be from 5% of the annual net sales of the enterprise, but not more than HUF 500 million.

Source: Act CLV of 1997 on Consumer Protection

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