Chapter 5: Regulating the Substance of Consumer Transactions
CHOICE OF REGULATORY TECHNIQUE Techniques such as information disclosure and ‘cooling-off’ periods, examined in the last chapter, can be summarized as attempts to use the law to support the consumer in the pre- and post-contractual phase. They aim to make the consumer more fully aware of the nature of the transaction under contemplation; and to provide an opportunity for withdrawal even after the deal has been agreed. So, to the extent provided by the Directives, the consumer is encouraged to think again before contracting and allowed to change his or her mind even after contracting. But the terms of the bargain themselves are unaffected by these measures. The assumption of the technique of information disclosure is that the consumer, armed with a clearer appreciation of what is on offer, will be able to negotiate a deal closer to his or her real preferences. In consequence, the market system will work more efficiently. ‘Cooling-off’ periods offer a fall-back protection. Such legal intervention designed to improve the conduct of the bargaining process attracts the criticism that it may simply not go far enough to achieve effective protection of the consumer. The technique of informing the consumer assumes, among other things, that the consumer is capable of grasping the nature of the information provided. The more complex the product or service and/or the more complex the nature of the information, the less likely that the consumer will be able to respond intelligently to such information. In certain circumstances it may be true that...
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