Maxim Yuzifovich commented on the adoption of amendments to the law for RBC
“Intrusive” services: how the law will affect businesses worth billions
Maxim Yuzifovich, CEO of the Legal Right law firm, commented for RBC on the adoption by the State Dumaой in the first reading of amendmentsокto the law on consumer protection, which are aimed at prohibiting the performanceения of paidх additionalх workor services without the consent of the consumer.
The problem of imposing additional paid goods and services is significant and widespread: according to conservative estimates of analysts, the volume of this business in Russia can reach tens of billions of rubles a year. It was particularly acute in the field of financial and banking services and attracted the attention of the Bank of Russia as a regulator of this sector several years ago. Now banks can be subject to various sanctions, including fines for misseling-the imposition of financial services. Nevertheless, the situation was not completely eradicated, and not only banks are engaged in imposing services: Prime Minister Mikhail Mishustin said in December that Rospotrebnadzor continues to receive complaints from citizens about violations of their rights. This happens, for example, when buying plane or train tickets. This is what people face when paying for housing and communal services and buying cars, and sometimes they try to provide the services required for compulsory health insurance for a fee, the head of government listed.
This week, the State Duma in the first reading adopted amendments to the law on consumer protection, which will prohibit sellers from performing paid additional work or providing services without the consent of the consumer. If such services were provided without consent, the consumer can refuse to pay and demand a refund. If adopted, the law will come into force on September 1, 2025. The conclusion of the State Duma Committee on Industry and Trade following the first reading states that “structuring and streamlining the legal norms proposed by the draft law will provide certainty in defending violated consumer rights in courts and will affect the positive dynamics of the consumer market development.” The Bank of Russia for January—September 2024 (more recent data is not yet available) received more than 241 thousand complaints from consumers of financial services. These data are comparable to last year’s figures, the regulator said. According to the regulator’s statistics, the number of complaints about the imposition of additional paid services by banks decreased by 40.6% compared to the same period last year, and the number of cases of misseling decreased by 2.7 times.
Is it possible to evaluate the market of imposed paid services
Economists find it difficult to give an accurate estimate of the total volume of the imposed services market across the country due to the lack of open data. However, given the prevalence of the problem in various sectors of the economy, they assume that we are talking about significant amounts, possibly amounting to tens of billions of rubles a year.
“If we assume by experience that the cost of additional services (such as included meals, insurance for ticket refund for any reason, seat selection, alerts, etc.) can range from 0.5 to 5% of the ticket purchase price, then based on the site data statistica.com, which in its forecasts estimated the revenue of the railway ticket market in We can conclude that the volume of sales of additional “ticket” services can be estimated from several tens to several hundred million dollars, which in terms of the current currency exchange rate is estimated at tens of billions of rubles,” said Nikolai Perepelkin, Associate Professor of Marketing at the Plekhanov Russian University of Economics.
Companies ‘ revenues from imposed services can be significant, but the exact amounts depend on the industry and the specific company, says Yaroslav Kabakov, Finam’s Strategy Director. In his opinion, the introduction of a ban on such practices may lead to a decrease in the income of companies using such methods, but it is difficult to provide an accurate estimate of losses without specific data.
What risks are there in the wording of the law
The process of “imposing additional services” in the draft law is described excessively broadly, according to the All-Russian Union of Insurers (VSS). “Without specifying the concept of “service imposition”, it can be interpreted in different ways and applied, for example, to the usual informing of the client before entering into an insurance contract about the products of an insurance company that will complement the client’s choice or make the product more attractive. Or when simultaneously executing contracts for compulsory and voluntary insurance, for several objects of property, or for several types of insurance. The legal uncertainty contained in the draft law allows us to interpret such contract design as the imposition of additional services, ” the association believes.
The BCC also warns that the adoption of the draft law will complicate the processes of implementing services in the e-commerce segment and lead to difficulties in accessing additional services, as well as to a possible increase in their cost.
As for the sale of voluntary insurance policies when buying tickets, it is carried out in strict accordance with the current legislation, the BCC assured. This is confirmed by Russian Railways. “Based on the recommendations of Rospotrebnadzor, the function of automatic marking (ticks) when issuing an electronic travel document was disabled several years ago,” the company’s press service told RBC, adding that now on the Russian Railways web resources (website and mobile application) when issuing an electronic travel document, the user can independently apply for insurance if desired..
Customer complaints about paid services from the MHI list are very common. The explanatory note to the draft law cites VTsIOM data for November 2023, when four out of ten Russians surveyed (43%) noticed that they were trying to provide paid services under the compulsory health insurance policy.
“In order to avoid situations when medical organizations offer citizens paid services that they could receive under a mandatory health insurance policy, it is necessary to specify the Program of state guarantees for free medical care to citizens, which will allow distinguishing between paid and free services and will lead to an unambiguous understanding of both medical organizations and citizens of the volume of these services,” – they count in the VSS.
The current legislation contains enough legal means to protect the interests of consumers, according to Maxim Yuzifovich, General Director of the Legal Right law firm. “The proposed bill may serve as a multiple cause of abuse on the part of consumers who, for some reason, have become uninterested in the purchased product,” he fears.
According to the decision of the State Duma, amendments to finalize the bill for the second reading are accepted until February 10.
Who will benefit from the adoption of the law
Among the bill’s supporters is Artem Sokolov, President of the Association of E-Commerce Companies (AKIT). According to him, the work on the draft law was conducted in an open mode, the association’s comments were taken into account, and the final document contained more specific wording than in earlier versions. “In the e-commerce industry, the practice of automatically ticking boxes has been eradicated for a long time. Definitely, the new rules will help protect consumers ‘rights from non-transparent conditions in all industries,” he told RBC.
The adoption of a legislative ban on the imposition of additional services will benefit primarily consumers, protecting them from unnecessary expenses and the conclusion of unprofitable contracts, adds Kabakov from Finam. “Bona fide companies will also benefit, as this will create a level playing field and increase customer confidence,” the analyst believes.
Oleg Moskvitin, Deputy Director of the National and Comparative Law Research Institute at the Higher School of Economics, believes that the law deserves support because it is not the citizen himself who shows extra vigilance and turns off all ticks when buying services, but sellers and contractors who create conditions so that there are no automatic, thoughtless purchases. “At the same time, it is important that the costs of its execution do not fall on you and me, that is, we do not increase the price of goods and services additionally. Of course, it will be difficult to ensure and control the latter, ” the economist notes.
Complaints to Rospotrebnadzor and public statements by high-ranking officials point to the systemic nature of the problem affecting a wide range of consumers, says independent financial consultant Anna Osokina. The problem is also widespread in other sectors, for example, in the field of communications (imposing additional options to tariff plans), financial services (insurance, credit products), as well as in retail (extended warranty, paid delivery services).
“First of all, consumers will benefit from the ban on the imposition of additional services. They will be able to avoid unexpected expenses and more consciously approach the choice of goods and services. However, the ban may negatively affect the business models of some companies that rely on income from additional services, ” Osokina said.
In general, a law that protects consumers from the imposition of paid services will bring long-term benefits to society, increasing market transparency and the level of trust in companies, experts agree. However, in the short term, some companies may face financial difficulties. Therefore, it is important to ensure a smooth transition to the new rules in order to minimize negative consequences for business and the economy as a whole. Moreover, effective control over the implementation of the law will also be critical for achieving the desired result, experts note.