The CJEU Gives Its Blessing to Racketware, in Disregard of European Consumers' Rights

Paris, September 15^th, 2016 – Press release

The Court of Justice of the European Union, in a judgment published on September 7^th, 2016, endorses forced bundled selling of computers and software, instead of protecting consumers, and leaves it up to national jurisdictions to settle disputes on a case-by-case basis.

On Thursday, June 25^th, 2015, the French Court of Cassation had referred a question on forced bundled selling of computers and software to the Court of Justice of the European Union, for a preliminary ruling. In that case, a consumer wanting to purchase a particular model of a Sony computer wasn't able to do so without buying the operating system and several software products that had been preinstalled on the machine. He demanded reimbursement in a court of law: the refund was denied on appeal.

The Court of Cassation did not rule on the merits of the decision, but rather considered that this was a substantial legal issue that had to be addressed by the European jurisdictions, to ensure that Directive 2005/29/EC concerning unfair business-to-consumer commercial practices applies uniformly throughout the EU.

The Court of Justice of the European Union had to answer the following questions:

(1) Should Articles 5 and 7 of Directive 2005/29/EC of the European Parliament and of the Council of May 11^th, 2005, concerning unfair business-to-consumer commercial practices in the internal market be interpreted to mean that the joint offer of selling a computer with preinstalled software is an unfair commercial practice, when the computer manufacturer has provided information on each preinstalled software product through its dealer, but has not specified the cost of each item ?

(2) Should Article 5 of Directive 2005/29 be interpreted to mean that the joint offer of selling a computer with preinstalled software is an unfair commercial practice, when the computer manufacturer doesn't leave any other alternative to the consumer than to accept the software or obtain cancellation of the sale ?

(3) Should Article 5 of Directive 2005/29 be interpreted to mean that the joint offer of selling a computer with preinstalled software is an unfair commercial practice, when the consumer is unable to obtain from the same manufacturer a computer that is not equipped with software ?

The Court of Justice rendered its judgment this Wednesday, September 7^th, 2016, (the CJEU's press release and its judgment). In its judgment, the CJEU holds that forced bundled selling of computers and software does not in itself constitute an unfair commercial practice and leaves it up to national jurisdictions to settle disputes on a case-by-case basis. Next INpact published a review of the case (in French).

According to the judgment, the French, Belgian, and Czech governments, as well as the European Commission, submitted their observations. For reasons of transparency, April calls for these observations to be made publicly available.

In the past, the European Commission has fined Microsoft for its abuse of its dominante position, without having any effect on stopping its unfair commercial practices. Today, in an unbelievable decision, the CJEU uphelds forced bundled selling of computers and software in disregard of consumers' freedom of choice and freedom to decide for themselves and to their best knowledge the offer best suited to their needs. Thus, this judgment allows the American company to extend further its quasi-monopoly.