EU-wide complaints-classifying system to speed up policy response to failing markets - briefing
07 July 2009by eub2 -- last modified 09 July 2009
The European Commission has unveiled a blueprint for an EU-wide method for classifying and reporting consumer complaints, inviting public comments on the proposal. The number of consumer complaints is a key indicator of market health. About half of European consumers who are dissatisfied with how their original complaint was handled by a trader turn to a third party such as a consumer organisation or regulator for help. About 700 complaint-handling organisations exist in Europe, and most of them use their own classifications, which makes an overview very difficult, even at a national level. The idea behind today’s proposal is to ensure that organisations across the EU collecting consumer complaints can use a comparable classification method and then report their data to the Commission. The analysis of the EU-wide data will be a powerful way to help assess how different sectors and national markets are performing for consumers, and enable authorities at national and EU level to more quickly and effectively target markets which are failing consumers. After collecting and analysing feedback from the consultation, the Commission will recommend the final version of the methodology. The complaints classification will be used by organisations on a voluntary basis.
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The blueprint which the European Commission presented today offers a standardised way of collecting a complaint, using a common grid of criteria for classifying cases. The criteria include, for example, the selling method (e.g. a shop or an online purchase), the type of business (e.g. a supermarket or a petrol station), and the product category (e.g. electronic goods or life insurance).. It is intended for use by third parties collecting complaints, such as national consumer authorities, consumer organisations, ombudsmen, complaints boards or regulators. Organisations will opt to use the classification system and to send their data to the Commission on a voluntary basis. The Commission would then make the data public through the Consumer Markets Scoreboard.
In 2008, the Commission asked the stakeholders about their views on the idea of a harmonised EU-wide classification. 80 % of those responding were in favour of the idea. Building on that, the Commission asked a group of experts representing complaints-collecting bodies for help in developing the blueprint which has been presented today.
Why do consumer complaints matter?
In the year leading to February 2008, around 78 million European citizens complained formally to a trader. Another 30 million people did not complain even though they had reason to do so. About half of those who complained formally were not satisfied with the way in which the complaint was handled. Of those who were still dissatisfied, about half (around 20 million people) contacted a third-party organisation for help 1 .
A consumer complaint is a hard fact which could be a sign of a systematic problem in the market. Complaints are one of the five key indicators used by the Consumer Markets Scoreboard of how markets are performing for consumers, along with consumer satisfaction, prices, switching suppliers and safety.
Why an EU-wide approach?
A Commission' study found that there are over 700 third-party organisations collecting consumer complaints in Europe. Some have advanced and detailed reporting systems. But each classifies complaints differently. For example, some bodies use categories mirroring the Yellow Pages, while some others use chapters of national legislation as a basis.
As a result, this valuable source of information remains largely untapped. Comparisons are often difficult even at a national level, let alone the European level, even though the goods and services on offer across the EU are similar, and even though a fair number of them are now traded across borders. The data fragmentation slows down the response of national and European policy makers to the problems encountered by consumers on specific markets.
Who will benefit?
The chief beneficiaries will be the EU consumers themselves, since the time needed for national and European policy makers and regulators to respond to consumers' daily concerns should be reduced considerably.
National authorities and regulators should be able to respond better to emerging trends, thanks to a more complete picture of their own markets, and easier comparisons with other countries. EU policy makers will be able to meaningfully compare EU-wide complaints data with other key market indicators such as prices or supplier switching.
Many non-governmental consumer organisations which now lack the resources to develop their own systems and to influence consumer policy upstream will also benefit from the availability of an off-the-shelf method and of comparable data.
Next steps
The Commission invites comments on the proposal by 5 October 2009. Once the comments have been analysed, the Commission will recommend a final methodology.
Source: European Commission