Topic: Online shoppers' rights boosted

[Clive]

March 23, 2006
Quentin Reade

Web users using a credit card to buy goods from an overseas website are now better protected.

The Court of Appeal yesterday ruled that section 75 of the Consumer Credit Act 1974, which allows consumers to claim money back from the credit card company if a transaction goes wrong, applies to overseas as well as domestic transactions.

The judgement follows an appeal by the Office of Fair Trading against a ruling in the High Court.

The Court of Appeal ruling confirms the OFT's view that credit card issuers are individually as well as jointly liable with suppliers if the consumer has a valid claim for misrepresentation or breach of contract by the supplier where the price of the purchase is above £100 but no more than £30,000.

Cardholders are, therefore, able to make a claim against the credit card issuer as well as or instead of the supplier.

Section 75 covers foreign transactions including where:

a consumer uses a UK credit card to buy goods while abroad

a consumer orders goods from a foreign supplier while abroad for delivery into the UK

a consumer in the UK buys goods which are delivered to a UK address from overseas by telephone, mail order or over the internet

there is face-to-face pre-contract dealings with a foreign supplier temporarily in the UK, or with a UK agent of a foreign supplier, but the contract is not completed in the UK.

John Fingleton, chief executive at the OFT, said:

?The application of section 75 to overseas credit card purchases has long been uncertain, and we are pleased that the Court of Appeal has been able to examine Parliament's intention behind the legislation, and resolve the issue in favour of consumers and in a way which takes account of developments in the market.?

The OFT has published the following tips for consumers about credit card purchases:

The consumer protection of section 75 means that money that seemed lost on a credit card purchase can be claimed back

If you pay by credit card you can claim your money back from the card company if the seller fails to honour the contract, or the item is faulty or if the seller wrongly describes it or if the supplier goes out of business

You do not have to attempt to claim your money back from the seller first -the credit card company is individually liable

If you are buying an item costing over £100 and you are asked for a deposit, consider paying the deposit by credit card

You are not covered by section 75 if you use a debit or charge card.

http://www.oft.gov.uk

[Simon]

[Delgado]

I also applaud this ruling-the more protection we have as purchasers the better.

  However, in the realm of fairness, I dont really see why a Credit Card Company should be held responsible. The Credit Card Company dont ask you to make the purchase in the first place-you choose to buy, and you choose where to buy from.

 The Credit Card Company are simply lending you the money to make the purchase, why should they be responsible for faulty goods?

 If I lend my friend money to buy something, is it my fault the goods dont arrive or are faulty?

  I dont suppose many will agree with me, but as an ex retailer, I must point out that everyone has rights, not only the customer!



      

[Simon]

Yes, but the credit card companies encourage the consumer to spend on them, and guarantee online safety against fraud.  Any claims would be covered by the CC company's insurers, and with the interest rates they charge, I wouldn't feel too sorry for them.  Also, I believe, if a claim is made on a purchase made on a credit card, the credit card company will charge the retailer an admistration fee, if the retailer is found to be at fault, so they don't really lose out anywhere.