[A2k] Consumers buying computer software need better protection - NCC calls on the EU to plug gaps in the law

[Michelle Childs]

http://www.ncc.org.uk/news_press/pr.php?recordID=3D377&PHPSESSID=3D5645d2ec=
fb9fe04b0c23c92845f8fd74

Consumers buying computer software need better protection - NCC calls
on the EU to plug gaps in the law

Tue, February 19 2008

The National Consumer Council (NCC) has called for a clampdown on
software companies that mislead computer users into signing away legal
rights, and today has published new evidence to present to the
European Commission (EC).

NCC and Europe-wide consumer groups are asking the EC to plug the gaps
in the consumer rights and protection framework. They want the
Commission to extend the scope of the Consumer Sales and Sales
Guarantees Directives to include digital contracts and licence
agreements through its review of the Consumer Acquis. This action
coincides with NCC=92s decision to refer 17 companies to the UK=92s Office
of Fair Trading (OFT) for investigation.

New NCC research reveals that software rights-holders are shifting the
legal burden onto consumers who buy computer programmes, leaving them
with less protection than when they buy a cheap biro. Findings,
supported by studies carried out by consumer organisations in Norway
and Germany, concluded firms have an unfair advantage over consumers.

The NCC shopping survey of 25 software products found 11 different
=91governing laws=92 that applied to UK consumers. These virtual goods are
often marketed internationally, but consumers=92 legal rights and
protection vary from country to country.

NCC Senior Policy Advocate Carl Belgrove said: =91Plugging the gaps in
the EU consumer rights and protection framework is a vital move.
Consumers can=92t have a clue what they=92re signing up to when some terms
and conditions run to 10 or more pages. There=92s a significant
imbalance between the rights of the consumer and the rights of the
holder.=92

The survey found a widespread lack of clear, upfront information
written in plain English. More than half of the 25 products surveyed
did not mention on the packaging that the consumer has to sign an end
user licence agreement (EULA) before they can use it. Only four of the
companies included a web link to an online copy of the agreement, and
six more included paper copies inside the instruction manual that
could only be accessed after opening the pack. On seven products the
only option was to read the agreement onscreen. This means that
consumers are unable to make informed decisions before they buy a
product, yet are being forced to take on an unknown level of legal
responsibility.

NCC findings uncovered examples with the potential to mislead
consumers. For instance, Cakewalk=92s Music Creator 3 onscreen agreement
highlights only certain elements important to protect company
interests, and fails to give consumers a full summary of the terms.

NCC is calling for:

=95    European Commission to fill the gaps in the consumer rights and
protection framework and put digital contracts and licence agreements
into consumer law
=95    Software rights-holders to address consumer concerns
=95    Office of Fair Trading to examine potentially unfair contract
terms identified in NCC=92s study 'Whose licence is it anyway?'

Click here for the report.

Ends

Notes to editors
1.    The NCC shopping survey looked at 25 computer software products
and found that 14 did not mention that installation of the software
depends on the user accepting a licence agreement. Only four included
a web link to an online copy of the agreement. Reading the licence
agreements NCC found terms and conditions that are potentially unfair
and to the detriment of consumers.
2.    The 17 companies NCC has referred to the OFT for investigation
are: Adobe, Microsoft, Apple, Chief Architect, Symantec, Magix, Nero,
Corel, Sega, Nova Development, Britannica, Sonic Solutions, Twelve
Tone Systems, THQ, GSP,  McAfee, Kaspersky
3.    Whose licence is it anyway? can be downloaded from the NCC
website at www.ncc.org.uk
4.    The European Commission Consumer Acquis is a review of
inconsistencies in consumer protection law across the EU. In the light
of the results, the legislation may be revised.
5.    Here are some examples of potentially unfair terms and
conditions highlighted in the survey.
-    A clause in Symantec=92s Norton 360 anti-virus package gives the
provider the right to suspend services for misuse of the software or
suspected failure to comply with the agreement. This could mean a
consumer facing a court case to clear their name before being able to
use the programme again.
-    The onscreen agreement for Cakewalk=92s Music Creator 3 contains
three separate components: the full licence; an undertaking to install
the software on one machine only at a time; and an undertaking never
to transfer your rights to use the software. This is set out to
protect the interests of the provider by highlighting elements that
are important to them.
-    Kaspersky Anti-Virus 6 had a seal on the CD case with
instructions to read an enclosed paper copy of the licence agreement
before installing software.


About the National Consumer Council (NCC)
The NCC makes a practical difference to the lives of consumers around
the UK, using its insight into consumer needs to advocate change. We
work with public service providers, businesses and regulators, and our
relationship with the Department for Business, Enterprise & Regulatory
Reform =96 our main funder =96 gives us a strong connection within
government. We conduct rigorous research and policy analysis to
investigate key consumer issues, and use this to influence
organisations and people that make change happen. Check www.ncc.org.uk
for our latest news.



---------
Michelle Childs
Head of European Affairs
Knowledge Ecology International
michelle.childs@keionline.org

"The world we have made, as a result of the level of thinking we have
done thus far, creates problems we cannot solve at the same level of
thinking at which we created them=94  Albert Einstein