The term “basic rate” in customer service telephone calls

Written on 27 Apr 2017

The Court of Justice of the European Union has ruled that the cost of calls made to customer service telephone lines should not exceed the cost of a standard call and that the trader may obtain profits by operating said helpline.

As a result of the Criminal and Civil Regional Court of Stuttgart requesting that the Court of Justice of the European Union (the “CJEU“) issues a preliminary ruling within the framework of legal proceedings related to the cost of calls that consumers make to customer service telephone lines operated by traders, the CJEU has construed the meaning of the term “basic rate”, which is mentioned in Directive 2011/83/EU on consumer rights (the “Directive“).

In accordance with the Directive’s protectionist nature in relation to consumers, the high court considers that the term “basic rate” can only be understood within the meaning given to the expression in its everyday use, that is, the rate fixed for a standard call; and, therefore, the consumer should reasonably expect that it will not have to pay any additional costs. The CJEU argues that a different interpretation to the one mentioned, could weaken the rights granted to consumers by means of the Directive.  It resulted in applying a rate higher than the rate of a standard call to a geographic landline or mobile, it would discourage consumers from using customer telephone services.

It should be highlighted that the CJEU ends its legal interpretation explaining that as long as the rate of customer telephone calls does not exceed the cost of a standard telephone call, it is irrelevant whether the trader obtains any profits from helpline calls.

However, Spanish consumer and user regulations consider that the basic rate must fulfil two requirements. The first one, as argued by the CJEU, is that said rate must be associated to the ordinary cost of the call being made, and the second one is that under no circumstances should the cost of said call result in the trader making a profit from operating a helpline service.

It is precisely this second requirement, set out in the Spanish consumer and user regulations, in addition to the CJEU’s recent resolution, that has caused concern as well as doubts in the interpretation of the term “basic rate”. On the one side, the CJEU is ambiguous in its definition of “basic rate”, using terms such as “the rate for a standard call to a geographic landline or mobile telephone line”, “ordinary rate for a telephone call at no additional cost for the consumer” or “ordinary charges”, without being too specific. On the other side, because the CJEU allows traders that operate a helpline service to make a profit from managing the claims being made by consumers, thus enabling them to act perversely and to organize the helpline and manage the claims inefficiently. This reasoning also allows them to enter into agreements with telephone service providers in order to receive financial incentives based on the number of calls received.

Finally, it is worth mentioning that this resolution reopens the discussion on whether Spanish traders may carry on using 902 numbers to provide customer support services, specially taking into account the excessive use that traders make of this number, in addition to not being included in the majority of flat rates offered by telephone service operators. In this respect, it should be mentioned that some Spanish consumer and user associations defend fining companies that use 902 numbers.