Autofestival 2024: What you need to know about contracts

The Autofestival is a not-to-be-missed event that attracts large numbers of consumers looking for the latest vehicle models and great deals. A range of deals are concluded between car professionals and consumers, such as purchase, credit and leasing contracts. In this regard, the Directorate for Consumer Protection would like to remind you of the rules governing the various contracts, in particular when it comes to the right of withdrawal and the obligation of professionals to provide clear and comprehensible information to consumers before any contract is signed.

Purchase contracts

Generally speaking, a distinction must be made between contracts concluded on the trader's premises and contracts concluded at a distance or off-premises:

1. Consumers who conclude a distance or off-premises purchase contract have a 14-day right of withdrawal (without having to give a reason) (https://gd.lu/50HQ1n);
2. This right does not exist in the case of a contract concluded on the premises of the trader. However, it is possible for the seller to grant a contractual right of withdrawal on his own initiative. In this case, the terms and conditions (how? when?) must be clearly indicated on the order form. This option does not constitute an obligation on the part of the professional.

It should be noted that if the consumer decides to terminate the contract unilaterally, he exposes himself to the risk of having to pay damages to the professional-dealer or, where applicable, of having to pay the amount stipulated in the penalty clause in the contract. The professional is entitled to require fulfilment of the contract and to force the consumer to take delivery of the vehicle under the conditions laid down in the contract.

Leasing contracts

Be careful when signing a "car leasing contract with no obligation to buy", i.e. a contract in which a person leases a vehicle for a fixed period, usually several years, without being obliged to buy the vehicle at the end of the contract! A recent ruling by the Court of Justice of the European Union has confirmed that consumers who conclude a car leasing contract with no obligation to purchase do not have a right of withdrawal, unless they have not been properly informed of their rights and obligations (https://gd.lu/35GPv3).

Consumer credit agreements

In the case of consumer credit agreements, consumers have a 14-day right of withdrawal. It should be noted that this withdrawal period only begins to run once the consumer has received complete and accurate information.

The Directorate for Consumer Protection also points out that signing an order form implies the conclusion of a contract with the professional. With their signature, both parties are validly bound and must perform the contract, i.e. the trader must deliver the vehicle ordered within the time specified and the consumer must pay the price stipulated in the document.

Finally, the public should be aware that agents from the Directorate for Consumer Protection will - again this year - be carrying out checks on vehicle dealers throughout the festival. These checks will focus in particular on the correct display of the prices of vehicles and products sold, the correct display of prices including tax for labour, unambiguous, easily identifiable and easily legible prices and rates, as well as spot checks of the general terms and conditions and order forms.

In this context, Martine Hansen, Minister for Consumer Protection, points out that "The Directorate for Consumer Protection always strives to help businesses respect consumer rights. We firmly believe that the best approach is to work closely with professionals. That's why we are informing professionals about their legal obligations ahead of the festival and offer them support in the event of any problems. Nevertheless, our agents will remain vigilant about compliance with legal provisions throughout the festival. We recommend that consumers always take the time to read and understand the terms of contracts before signing them, in order to avoid complications later on".

Press release by the Directorate for Consumer Protection