On 7 June 2023, the European Council announced that it had reached provisional political agreement with the European Parliament on a draft Directive that updates the 2002 Directive on distance marketing of consumer financial services. Specifically, the draft Directive repeals the 2002 Directive and introduces new provisions for financial services contracts concluded at a distance as an additional chapter of the Consumer Rights Directive (CRD). Certain articles of the CRD will also apply to financial services sold at a distance.

The announcement highlights the following:

  • The provisional agreement clarifies the scope of application and safety net-feature in the Directive, in particular for financial services that are excluded from other sectoral legislation or only partially covered by it.
  • The provisional agreement improves the rules on information disclosure and aims to modernise pre-contractual information obligations and keeps the possibility for Member States to impose stricter national rules in this area, thus avoiding any risk of lowering the level of protection for consumers.
  • Where the trader uses online tools, such as robo-advice or chat bots, the consumer will have the right to request human intervention, in order to better understand the effects of the contract on his or her financial situation.
  • The provisional agreement facilitates the exercise of the right of withdrawal from contracts concluded at distance through the inclusion in the service provider’s interface of a ‘withdrawal function’.
  • The agreement introduces additional protection for consumers from dark patterns. Once the agreed text is in force, Member States will have to take measures to limit the use of dark pattern marketing techniques to influence consumer’s choice.

The provisional political agreement now needs to be endorsed and formally adopted by both institutions.