Unfair Commercial Practices Directive, Chapter 1, Article 2, (d) Unfair Commercial Practices Directive, Chapter 1, Article 2, (h) Unfair Commercial Practices Directive, Chapter 2, Article 5, 2., (a) Unfair Commercial Practices Directive, Chapter 2, Article 5, 2., (b) Unfair Commercial Practices Directive, Chapter 2, Article 5, 4., (a) Unfair Commercial Practices Directive, Chapter 2, Article 5, 4., (b) Unfair Commercial Practices Directive, Chapter 2, Section 1, Article 7, 1. Unfair Commercial Practices Directive, Chapter 2, Section 1, Article 7, 4., (e) Unfair Commercial Practices Directive, Chapter 2, Section 2, Article 8 Unfair Commercial Practices Directive, Chapter 4, Article 13

(1) The practice of a trader of denying consumers their right of withdrawal and not providing a refund nor executing a consumer's decision to execute such right, qualifies as an aggressive commercial practice.

(2) The non-fulfillment of local law requirements and inclusion of unfair terms in mutual agreements with consumers, is not consistent with the required professional diligence of a trader.

The defendant offered rooms in its high class apartments for short term holidays and concluding agreements on these services outside the location of sale.

According to the Latvian Consumer Rights Protection Law (CRPL) services provided outside the permanent location of sale (i.e. distance sales) require a trader to ensure the right of withdrawal and inform a consumer about this right. The Consumer Rights Protection Centre (CRPC) came to the conclusion that the defendant did not inform consumers about this right in its presentations regarding the services concerned.

Therefore, according  to CRPC, the defendant performed a misleading commercial practice by omitting material information (i.e. right of withdrawal), prohibited by UCP Directive article 7.4(e) and the corresponding clause in Latvian Unfair Commercial Practice Prohibition Law.



CRPC established that the defendant had denied consumers their right of withdrawal by ignoring such requests by several consumers, not providing a refund and not answering to applications of customers.

CRPC also established that the trader had included unfair terms in its agreements with consumers, requesting an administrative charge of 300 LVL (approx. EUR 400) in case the consumer exercised its right to withdraw. Violations of CRPL and other local law regulations were also established. Therefore, CRPC accused the trader of aggressive commercial practice prohibited by article 8 UCP Directive.

CRPC also accused the defendant of commercial practices not consistent with professional diligence and prohibited by UCP Directive art. 5.2(a).

(1) Does the practice of a trader of denying consumers their right of withdrawal and not providing a refund nor executing a consumer's decision to execute such right, qualify as an aggressive commercial practice?

(2) Is a non-fulfillment of local law requirements and inclusion of unfair terms in mutual agreements with consumers, consistent with the required professional diligence of a trader?

(1) In its decision the CRPC first established that the practice of the trader qualified as coercion and use of undue influence, which has significantly impaired or was likely to significantly impair an average consumer's freedom of choice and his conduct with regard to the service.

The defendant, CRPC held, thereby caused a consumer to take a transactional decision that he would not have taken otherwise (e.g., decision not to withdraw from the concluded agreement, or choose another service provider). Therefore, CRPC found that the practice of the trader constituted an aggressive commercial practice.

(2) CRPC further pointed out that a consumer can justifiably expect of a trader (as professional businessman in the relevant field of activity) to adhere to consumer rights established by law, not to encompass unfair terms in agreements offered to consumers and to exercise commercial practice corresponding with honest market practice and the general principle of good faith.

The practice of the trader could materially distort the economic behavior of consumers, by encouraging consumers to take a transactional decison that they would not have taken otherwise. Therefore, CRPC concluded that the practice of the trader was not consistent with the professional diligence.

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The trader was penalized for having committed an unfair commercial practice.