ECJ: Right to Cancel after Free Trial Period?

Nov 17, 2023 Benn-Ibler Rechtsanwälte

The European Court of Justice (ECJ) has been asked to rule on the right of withdrawal for subscriptions to learning platforms. Subscriptions often become payable if consumers do not cancel within the free trial period. So the question comes up: Can customers still cancel their subscription at this point?

A dispute between the Austrian consumer protection agency, VKI, and a learning platform for primary and secondary school students preceded the ruling.

The General Terms and Conditions of the learning platform in the case at hand provide that when a subscription is booked on the platform for the first time, it can be tested free of charge for 30 days from the conclusion of the contract and can be cancelled without notice at any time during this period. You further agree that this subscription will only become chargeable after the expiration of these 30 days and that the paid subscription period agreed upon at the conclusion of this contract will begin if no notice of cancellation is given within the aforementioned 30 days. If the paid subscription period expires without notice of cancellation, the subscription will be automatically renewed for a specified period. The learning platform shall inform consumers of their right of withdrawal/cancellation when concluding a distance contract.

However, the VKI took the view that consumers have a right of withdrawal/cancellation under Art. 9 of the Austrian Consumer Rights Directive not only by subscribing to the free trial subscription, but also by converting it into a regular paid subscription and renewing that subscription. The court hearing the case has now asked the ECJ for a preliminary ruling on the interpretation of the Consumer Rights Directive.

The ECJ has now decided:

Consumers only have a one-time right to cancel a distance contract that is initially free and automatically renewed. They do not have a renewed right of withdrawal for the paid extension of the subscription. The only exception would be if the consumer was not informed in a clear and comprehensible manner at the time of subscription that the subscription would become payable after an initial free period.

ECJ-565/22 (5 October 2023)