GER: Can Consumer Organisations Claim Refunds?

Oct 11, 2024 Benn-Ibler Rechtsanwälte

Remaining credit on festival wristbands: The extent to which consumer organisations can demand direct reimbursement for consumers in the event of unfair commercial practices has recently been considered by the German Federal Court of Justice (Bundesgerichtshof, hereinafter BGH).

The Federation of German Consumer Organisations (Bundesverband der Verbraucherzentralen) had sued the organiser of a festival for charging unjustified fees. The organiser of the event had supposedly been making unjustified charges by doing the following: Attendees could buy wristbands and upload them with money to make payments at the festival site. Any remaining balance could be refunded after the festival via an event portal for a fee of EUR 2.50. Such ‘payout fees’ are illegal, according to the Consumer Protection Agency, as they are unfair and anti-competitive.

The claimant asked the promoter to refund the consumers the amount of EUR 2.50 per person that had been deducted.

Such fees are indeed unlawful, the lower court ruled, however, the consumer protection association was not entitled to demand that the organiser refund the money to the consumers.

The BGH’s now decision was as follows:

A consumer association cannot use the right to an injunction based on competition law to demand that sums of money taken from consumers on the basis of invalid general terms and conditions be paid back to the consumers.

The repayment of money cannot be included in the claim for removal under the Competition Act. Such a claim would not be consistent with collective legal protection, according to the BGH. The concept of collective legal protection would be undermined by a no-fault claim for removal by these associations if a company could be obliged to repay the sums of money that had been withheld.

The clause in the organiser’s general terms and conditions is indeed invalid. This is because the defendant is not providing an independent service that can be remunerated when it reimburses unused funds, but is fulfilling an existing contractual obligation.

It is also an unfair practice because festival-goers may be dissuaded from claiming refunds by that clause.

Press release no. 180/2024 on BGH I ZR 168/23 (11 September 2024)