Parliament retreats on threat to ban ‘cold-calls’

Date: 14/12/1995

By Fiona McHugh

AFTER months of tough talk about defending consumers from unprincipled salesmen, MEPs have shied away from imposing a total ban on 'cold calls', preferring instead to let customers put their names on a 'do-not-disturb' list.

Intensive lobbying by publishers, telesales businesses and phone companies paid off this week, when a threat to force salesmen to get written consent from potential customers before ringing or faxing was averted.

MEPs heeded industry warnings that the proposed measure would place a huge administrative burden on companies and lead to lost business and jobs.

Parliamentarians had seriously considered banning 'cold calls', which they said invaded people's privacy, but finally decided only to insist on an 'opt-out' scheme which would allow people who did not wish to be showered with unwanted phone calls or faxes to ask to be left in peace.

Parliament also voted to put a complaints system in place and to require salesmen to identify themselves and state their business before launching into sales speeches. This provision would allow people on the other end of the phone to nip unsolicited phone calls in the bud.

MEPs did not carry out their threat to extend the scope of the draft directive on distance selling to include financial services. They rejected the idea after furious protests from banks and insurance companies who fought hard to win a derogation from EU consumer ministers earlier this year.

Financial service providers were particularly concerned about a provision in the directive allowing customers a seven-day cooling off period in which to change their minds about contracts they have signed.

Banks argued that any such arrangement, which would have allowed customers to return investment bonds which had devalued, for instance, would have caused chaos on the markets. In the event, financial services escaped the new rules.

According to the European Federation of Direct Marketing (FED!M), adoption of the proposed amendments would have sounded the death knell of the telesales business and led to the loss of up to 500,000 jobs. A FED!M spokeswoman yesterday welcomed the result, saying it would allow companies to continue to conduct phone business as usual.

The amended version of the directive must be approved by EU consumer affairs ministers before it can become law.