Retail and Consumer Goods03.11.2020 Newsletter

Right of withdrawal and e-food - is this combination possible?

Online trade has been booming for years and in times of the "corona crisis" more than ever. The food trade is also increasingly pushing into the online sector, especially in view of possible or already existing quarantine scenarios. Several big names in the industry are now active in the "e-food" business.

A requirement of online trading is that consumer law on distance selling, which is based on EU law, has to be taken into consideration. Although one could intuitively assume that the consumer's right of withdrawal is generally excluded for e-food purchases, such assumption would be a dangerous false conclusion.

The consumer-friendly right of withdrawal is also fundamentally available to customers in respect of food products ordered online or by telephone. The same applies to purchases via a door-to-door salesman. Disregarding this could lead to warnings from consumer centres and competitors. A definite prerequisite is that the customer places his order as a consumer and not as an entrepreneur.

It may seem strange to be allowed to return food that has been in the sphere of someone else and might therefore have become contaminated. The legislator has recognised this issue and in some cases has provided for exceptions to the general right of withdrawal, which are also relevant for foodstuffs and are summarised below:

The "pizza clause" only applies to deliveries by the food retail trade

A general sectoral exemption from distance selling law already exists for contracts for the supply of food, beverages or other household goods for everyday use that are supplied at the domicile, place of residence or workplace of a consumer by entrepreneurs in the context of frequent and regular trips (§ 312 (2) No. 8 German Civil Code [Bürgerliches Gesetzbuch, BGB]). This provision, also known as the "pizza clause", rarely seemed to be relevant in the past because the predominantly view held was that deliveries had to be made by the trader itself or at least organised by it. Delivery by a logistics company that accepts orders from anyone, on the other hand, was not deemed sufficient. Furthermore, the business model must, in its objective design, provide for regular and frequent deliveries to consumers (e.g. "meals on wheels"), in order for the exemption to apply; i.e. the ordering behaviour of the actual consumer is not decisive.

In the meantime, several online food shops are carrying out deliveries themselves. More and more voices are being raised against differentiating between deliveries made, for example, by a subsidiary of a supermarket chain and a general logistics firm. At the very least, according to those advocating this view, deliveries by a transport firm that is associated by framework agreement with the trader and that makes frequent and regular deliveries should be equivalent to delivery by the actual trader. However, as far as can be seen, there is no case law to date that meets this requirement. It would also not be possible to say with certainty whether the "frequency and regularity" criterion can be affirmed. However, the more common it becomes for consumers to order online - and this trend can be observed - the less problematic it will probably be in future to affirm this criterion of the sectoral exemption clause. Under the current legal situation, however, the situation would be fraught with considerable uncertainty if a food retailer - especially when a general logistics firm is involved - were to invoke the complete exclusion of distance selling law in reference to § 312 (2) No. 8 BGB. It is obvious that this can change in the future.

Exception to the right of withdrawal

Even in cases where distance selling law and thus the right of revocation applies in principle, the law provides for exceptions to the right of withdrawal. The cases in which such an exclusion applies are listed in § 312g (2) BGB.

The provisions relevant to the trade in foodstuffs are described briefly below:

Customised food (§ 312g (2) No. 1 BGB)

These are goods which are not prefabricated and which are produced on the basis of the consumer’s individual selection or determination or which are clearly tailored to the needs of the consumer. Customised food is becoming more and more fashionable: For example, customers can have muesli, exclusive coffees, teas or juices mixed or order individualised sweets. The right of withdrawal is excluded for such products. However, this is only the case if the seller has already started mixing or manufacturing the product at the time of receiving the withdrawal and is unable to separate the components again with little effort.

Perishable food (§ 312g (2) No. 2 BGB)

The right of withdrawal is also excluded for contracts for the delivery of goods that can spoil quickly or whose expiration date would be quickly exceeded. This provision is of great relevance: if quickly perishable food is sold, or food whose expiration date has been exceeded, it would constitute an unreasonable hardship for the seller if customers were allowed to return it. Goods are quickly perishable if, after their transport and their expected "retention time", a relatively substantial part of their total life has expired. Dairy products, fresh fruit and vegetables unproblematically fall under this category. In individual cases, however, it can be difficult to make a clear distinction.

The exception of the expiry date having been exceeded merely constitutes a special case of spoilage. It should be noted that the use-by date has to have been set according to recognised technical standards. Otherwise, an arbitrarily short expiry date could undermine the right of withdrawal.

Sealed food (§ 312g (2) No. 3 BGB)

A further exception to the right of withdrawal is the delivery of sealed food, if the sealed food has been opened after delivery. This provision is aimed especially at ready-made meals. Although the consumer is fundamentally entitled to inspect the purchased goods, in the case of sealed food this is limited to a mere visual inspection; otherwise, the trader would no longer be able to resell the goods.

Specific alcoholic beverages (§ 312g (2) No. 5 BGB)

The right of withdrawal is also excluded in the case of contracts for the delivery of certain alcoholic beverages. This applies to spirits whose price was agreed when the contract was concluded but which can be delivered at the earliest 30 days after the conclusion of the contract and whose current value depends on fluctuations in the market, over which the trader has no influence. This is frequently the case with wine, for example, or for high-proof alcoholic drinks such as whisky.

Delivery services (§ 312g (2) No. 9 BGB)

Albeit less relevant for online trade in food, the right of withdrawal is also excluded for contracts for the provision of services in the areas of "delivery of food and beverages". This provision is aimed primarily at catering services.

Flat-rate compensation of value in case of opened food and obligation to inform about the non-existing right of withdrawal

Food retailers should be extremely cautious in their general terms and conditions of business when using flat-rate compensation of value for opened but not easily perishable food (such as food supplements). The Regional Court [Landgericht, LG] of Dortmund, for example, has ruled that it is inadmissible to burden consumers with the full obligation to pay compensation for opened food products and to only enable them to prove to the seller that no damage or only lesser damage occurred in the specific case. This would lead to a de facto devaluation of the right of withdrawal (LG Dortmund, judgement of 14 March 2007 - 10 O 14/07).

When designing the general terms and conditions or the online shop, one should also bear in mind that consumers must be informed if no right of withdrawal exists (Art. 246a § 1 (3) No. 1 Introductory Act to the German Civil Code [Einführungsgesetz zum Bürgerlichen Gesetzbuch, EGBGB]. An infringement of this provision can also trigger a warning on grounds of unfairness (BGH, judgement of 9 June 2011 - I ZR 17/10).

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