Ministero della Giustizia

Last update 27 March 2020 by the Ministry of Justice

 

STARTING, RUNNING AND CLOSING A BUSINESS: RIGHTS AND OBLIGATIONS ARISING UNDER CONTRACT LAW, INCLUDING LATE PAYMENT INTERESTS

 

 

CONTRACT LAW AND SALES TO BUSINESSES AND CONSUMERS
 

Differences in contract law between B2B and B2C sales

The terms B2B and B2C are abbreviations relating to:

1. B2B (business to business): trade in goods or services between businesses;
2. B2C (business to consumer): trade in goods or services to the consumer;

in the e-commerce sector.

The rules on sales to consumers are intended to give greater protection to the weaker party to the contract and are set out in the Consumer Code.

In particular in B2C contracts:

• the seller is obliged to deliver goods to the consumer in conformity with the sales contract (Article 129 of the Consumer Code);
• the consumer is entitled to have the goods brought into conformity, free of charge, by repair or replacement (remedies which are not provided for contracts subject to the rules of the Civil Code), or to an appropriate price reduction or termination of the contract;
• the consumer may report defects within 2 months of discovering the defect and the trader must do so as soon as possible within 8 days (Article 1490 of the Civil Code). In any event, even after those periods have elapsed, the purchaser, whether a consumer or a trader, may bring an action for a guarantee within the limitation periods:

1. 26 months in B2C relationships (Article 132 of the Consumer Code),
2. 1 year in B2B relationships.

Furthermore, as regards unfair terms or terms which entail a particular imbalance in the rights and obligations of the consumer

• In B2C contracts, terms regarded as unfair (Articles 33 and 34 of the Consumer Code) are penalised by invalidity, while the contract remains valid for the remainder (Article 36). Invalidity works for the benefit of the consumer and may be established by the court of its own motion.
• Consumers can also rely, through representative associations, on the protection of injunctions and administrative protection which is entrusted to the Competition Authority. Injunction protection allows consumer associations to request the court to prohibit the use of unfair general terms and conditions. An injunction may be granted, where there are proper grounds of urgency, by way of interim measures in accordance with Article 669a et seq. of the Code of Civil Procedure. The court may order that the order be published in one or more newspapers, at least one of which has been distributed nationally.
• Administrative protection enables the Competition Authority, either on its own initiative or on the basis of a complaint, to declare that terms included in contracts between consumers and sellers or traders are unfair.
• In B2B contracts, the clauses listed exhaustively and those added to contracts concluded using pre-printed forms under Article 1342 of the Civil Code are ineffective unless specifically approved in writing (Articles 1341 and 1342 of the Civil Code).

Relevant legislation

Civil Code

• 1341 General contract terms and conditions
• 1342 Contract concluded using pre-printed forms
• 1490 Guarantee for defects in item sold
• 1492 Effects of the guarantee
• 1494 Compensation for damage
• 1495 Terms and conditions for the action

Consumer Code (Legislative Decree No 206 of 2005)

• 33 Unfair terms in the contract between a trader and a consumer
• 34 Determination of unfairness of contract terms
• 36 Invalidity of protection
• 37 Action for an injunction
• 37(a) Administrative protection against unfair terms
• 130 Rights of the consumer
• 132 Terms
• 134 Binding nature of the provisions
• 135 Protection under other provisions

 

Rules set at national level in addition to EU contract law rules, for example for the supply of digital content/services and the sale of goods to consumers – in particular for cross-border sales

1. Supply of digital content/services
   As regards electronic commerce, the legislator has provided that, in addition to the information requirements for specific goods and services, the service provider must make the following information easily accessible, for the recipients of the service, directly and permanently, to the competent authorities:

1. name, company name or corporate name;
2. their domicile or registered office;
3. the contact details which make it possible to contact the service provider quickly and to communicate directly and effectively with them, including the email address;
4. the registration number in the Directory of Economic Activities, REA, or the Commercial Register;
5. identification details, as well as details of the competent supervisory authority where an activity is subject to a concession, licence or authorisation;
6. as concerns regulated trades:
   • the trade association or similar institution with which the service provider is registered and the registration number;
   • the professional title and the Member State where it has been granted;
   • reference to and consultation of trading standards and any codes of conduct in force in the Member State of establishment;
7. the VAT number or other identification number deemed to be equivalent in the Member State, where the service provider carries out a taxable activity;
8. a clear and unambiguous indication of the prices and tariffs of the different information society services provided, indicating whether they include taxes, delivery costs and other additional elements to be specified;
9. the indication of the activities allowed to the consumer and the recipient of the service and the contract details where an activity is subject to authorisation or the object of the provision is supplied on the basis of a user licensing agreement..

2. Sales of goods to consumers
   Examples of the implementation of the relevant EU legislation include: ‘The consumer has a period of 14 days to withdraw from a distance or off-premises contract without having to give any reason’ in the Consumer Code, Article 52, as amended by Legislative Decree No 21/2014, it now provides for a period of 14 days to withdraw from a distance or off-premises contract without having to give any reason and without incurring any costs other than those required for return (the deadline used to be 10 days).

3. Cross-border sales of goods
   In the case of cross-border sales of goods, the applicable rules are, as appropriate, national private international law (Law No 218 of 1995) or the EU Regulation on the law applicable to contractual obligations (Regulation (EU) No 593/2008, Rome I).

 

Specific rules for online sales and for other types of off-premises sales, such as sales at fairs or at the consumer’s home

The Consumer Code (Article 45 of the Consumer Code) covers:

1. a ‘distance contract’ and defines it as any contract concluded between the trader and the consumer under an organised scheme for the sale or provision of services at a distance without the simultaneous physical presence of the trader and the consumer (sale may take place by telephone, fax, internet, etc.)
2. an ‘off-premises contract’ and defines it as any contract between the trader and the consumer:
   1. concluded in the simultaneous physical presence of the trader and the consumer, in a place other than the trader’s premises (e.g., at the consumer’s home);
   2. for which an offer has been made by the consumer, in the same circumstances as those referred to in point 1 (by mail order or by catalogue);
   3. concluded on the trader’s premises or by any means of distance communication immediately after the consumer has been personally and individually approached in a place other than the trader’s premises, in the simultaneous physical presence of the trader and the consumer; or
   4. concluded during a promotional trip organised by the trader with the aim or effect of promoting and selling goods or services to the consumer (e.g., during an outing);

In these cases:

• the trader must provide, in writing, detailed pre-contractual information in plain and simple language indicating:

1. the characteristics of the goods;
2. the identity and geographical address of the trader or place of business to which complaints are to be addressed;
3. the price;
4. additional costs;
5. the payment methods;
6. the terms of the guarantee;
7. the contract duration;
8. the time limits and forms for exercising the right of withdrawal.

• the supply of the goods or services must take place within 30 days of the date of conclusion of the contract, unless the parties agree otherwise; the consumer has a period of 14 days to withdraw without giving any reason and without incurring any costs other than the cost of returning the goods.

Relevant legislation

Consumer Code  (Legislative Decree No 206/2005)

• Article 2 Consumer rights

Chapter I – Consumer rights in contracts

• Article 45 Definitions
• Article 46 Scope
• Article 47 Exclusions

Section I – Pre-contractual information for consumers in contracts other than distance or off-premises contracts

• Article 48 Information requirements in distance or off-premises contracts

Section II – Pre-contractual information for the consumer and right of withdrawal in distance and off-premises contracts

• Article 49 Information requirements in distance and off-premises contracts
• Article 50 Formal requirements for off-premises contracts
• Article 51 Formal requirements for distance contracts
• Article 52 Right of withdrawal
• Article 53 Failure to comply with the obligation to provide information on the right of withdrawal
• Article 54 Exercise of the right of withdrawal
• Article 55 Effects of withdrawal
• Article 56 Obligations of the trader
• Article 57 Obligations of the consumer in case of withdrawal
• Article 58 Effects of exercising the right of withdrawal
• Article 59 Exceptions from the right of withdrawal

Section III – Other consumer rights

• Article 60 Scope
• Article 61 Delivery
• Article 62 Fees for the use of means of payment
• Article 63 Transfer of risk
• Article 64 Telephone communication
• Article 65 Additional payments

Section IV – General provisions

• Article 66 Administrative and judicial protection
• Article 66(a) Jurisdiction
• Article 66(b) Compulsory nature
• Article 66(c) Information and out-of-court redress
• Article 66(d) Unsolicited supply
• Article 67 Protection under other provisions

Chapter II – Electronic commerce

• Article 68 Referral (reference to the provisions of Legislative Decree No 70 of 2003 implementing Directive 200/31/EC)

 

If the rules are different in the case of off-premises sales and sales within business premises

The Consumer Code guarantees fundamental rights for all consumers and users:

1. protection of health
2. safety and quality of products and services
3. adequate information and honest advertising
4. the practice of commercial practices in accordance with the principles of good faith, fairness and loyalty
5. fairness, transparency and fairness in contractual relations
6. promotion and development of free, voluntary and democratic associations of consumers and users
7. provision of public services to quality and efficiency standards.

The increased protection for the consumer in the case of contracts concluded at a distance or away from business premises (in particular information requirements and the extension of the right of withdrawal) stems from the consideration that these types of sales:

• for the aggressive ways in which they are offered,
• or due to the element of surprise
• and, in any event, because they do not allow the consumer to see the product in real life,

expose the consumer to the risk of acting in a way that is not fully thought through without fully understanding the obligations attached to the contract.

Relevant legislation

Civil Code

• 1341 General contract terms and conditions
• 1342 Contract concluded using pre-printed forms
• 1490 Guarantee for defects in item sold
• 1492 Effects of the guarantee
• 1494 Compensation for damage
• 1495 Terms and conditions for the action

Consumer Code (Legislative Decree No 206 of 2005)

• 33 Unfair terms in the contract between a trader and a consumer
• 34 Determination of unfairness of contract terms
• 36 Invalidity of protection
• 37Action for an injunction
• 37(a) Administrative protection against unfair terms
• 130 Rights of the consumer
• 132 Terms
• 134 Binding nature of the provisions
• 135 Protection under other provisions

 

Whether sellers have to offer remedies and, if so, what kind of remedies

The seller is liable to the consumer for any lack of conformity which exists at the time of delivery of the goods.
In the event of a lack of conformity, the consumer is entitled to:

1. have the goods brought into conformity, free of charge, by:

1. repair, unless the remedy required is objectively impossible, or
2. replacement, provided that it is not prohibitively expensive (if it creates unreasonable costs for the seller) compared to repair.

Repairs or replacements must be carried out within a reasonable period of time after the request has been made and must not cause significant inconvenience to the consumer, taking into account the nature of the goods and the purpose for which the consumer acquired the goods.

or

2. a reasonable reduction in the price or the termination of the contract (provided it is not minor) if one of the following conditions occurs: (a) repair and replacement are impossible or excessively expensive; (b) the seller has not repaired or replaced the product within a reasonable period; (c) the replacement or repair previously carried out has caused significant inconvenience to the consumer.

In any event after the lack of conformity has been reported, the seller may offer the consumer any other available remedy:

1. if the consumer has already chosen a specific remedy, the seller remains obliged to implement it unless he accepts the proposed alternative remedy;
2. if the consumer has not already chosen a specific remedy, he must accept the proposal or reject it by choosing another remedy among those listed above.

Relevant legislation

Consumer Code (Legislative Decree No 206 of 2005)

Title III Legal guarantee of conformity and commercial guarantees for consumer goods

Chapter I Sales of consumer goods

• Article 128 Scope and definitions
• Article 129 Conformity with the contract
• Article 130 Consumer rights

 

How contracts for the provision of digital services are classified and which remedies are available

The contract for the supply of digital content is a contract which is typically concluded online and covers products of a digital nature: computer programs, applications, games, music, videos or texts, irrespective of whether such data is accessed by download, streaming, tangible medium or by any other means.

In Directive (EU) 2019/770 of the European Parliament and of the Council of 20 May 2019 on certain aspects concerning contracts for the supply of digital content and digital services, the following is defined as a ‘digital service’:

1. a service that allows the consumer to create, process, store or access data in digital form
2. a service enabling the sharing of, or any other interaction with, digital data uploaded or created by the consumer and other users of that service.

The contract for the supply of digital content may be concluded either online or offline.

1. If concluded online: it is a distance contract where the digital content is purchased by download or on a tangible medium such as a DVD, which the buyer can store, process and reuse.

In such cases, the consumer does not acquire the exclusive right of ownership but enjoys non-exclusive and repeated intangible goods and services against payment of a fee for the use of the goods or services.

2. If concluded offline: the digital content is supplied on a tangible medium through a contract concluded in person, away from business premises or even at a distance.

In the case of software, if the final and irrevocable transfer of the right to use the program takes place (and thus, for example, there are no limits to the buyer’s subsequent transfer of the program to a third party), the contract can be considered as part of the sales scheme.
The most common is the user licence, which is the act by which a person who holds the exclusive right to property transfers to third parties a specific and limited right of use and is comparable to a lease.

 

In contracts for the supply of digital content

who is responsible for defects in the goods or services sold

Directive (EU) 2019/770 of the European Parliament and of the Council of 20 May 2019 on certain aspects concerning contracts for the supply of digital content and digital services provides that the consumer is entitled to:

1. have the digital content or digital service brought into conformity,

 or

2. an appropriate price reduction, or termination of the contract (provided the defect is not minor)

The Directive also applies to contracts where the trader supplies or undertakes to supply digital content or digital services to the consumer and where the consumer provides, or undertakes to provide, personal data.

Relevant legislation

Directive (EU) 2019/770 on certain aspects concerning contracts for the supply of digital content and digital services

• Article 13 Remedy for the failure to supply

 

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