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Contract Law

 

The Right of Withdrawal after Purchases at Trade Fairs

The EU consumer directive came into force on 13 June 2014 giving exhibitors benefits under the law: In general, when consumers buy goods on exhibitions in Europe they have no right of withdrawal.

The Legal Background

Consumers have a right to withdrawal when making purchases anywhere other than on business premises and obliges vendors to provide comprehensive information (Article 2(9) of Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer rights). AUMA successfully made the case that exhibition stands should be considered to be a place of business – and that there is thus no longer a right of withdrawal from purchases made at trade fairs. In theory, there will continue to be a right of withdrawal from purchases at exhibitions – but only in cases where consumers are suprised by the fact, that it is possible to buy goods at the exhibition. However, that only happens in extremely rare cases.
 

No Surprises

The new legislation makes it clear that, unlike the case with a door-to-door sale, it should come as no surprise if a company tries to sell you something at a trade fair or exhibition. On the contrary, visitors normally pay for admission to these events, which is an additional psychological barrier similar to entering a “normal” place of business. Once consumers have consciously gone through this barrier, they can no longer claim to be taken by surprise if companies try to sell them something.

European Court on Consumer Rights at Exhibition

On 7 August 2018 the European Court stated, that Article 2(9) of Directive 2011/83 must be interpreted as meaning that a stand run by a trader at a trade fair, at which he carries out his activity for a few days each year, constitutes ‘business premises’ within the meaning of that provision if, in the light of all the factual circumstances surrounding that activity, in particular the appearance of the stand and the information relayed on the premises of the fair itself, a reasonably well-informed and reasonably observant and circumspect consumer could reasonably assume that the trader is carrying out his activity there and will solicit him in order to conclude a contract.

Aisle Considered Equivalent to the Stand

At trade fairs visitors standing in an aisle are often addressed by the staff at an exhibition stand. The issue is whether the aisle can be considered to be a place of business in the same way as the stand. The accepted view is that it can. Consequently, an exhibitor’s staff can actively approach visitors in the aisle in front of their stand – without having to be concerned that consumers will have a right of withdrawal if they make a purchase. On the other hand, any promotional activities conducted in a hall where the exhibitor is not represented are a different matter. Generally, however, event organisers do not want any such promotional activities to be conducted in halls where exhibitors are not represented, so it rarely happens. 

Exhibitor's Withdrawal

The district court of Nuremberg upheld major existing policies regarding the withdrawal of an exhibitor from trade fair participation in a verdict from 17 July 2015. The court ruled that the exhibitor is not unreasonably disadvantaged if, according to the organiser’s General Terms of Participation, the stand is first allocated after registration and at the same time as the approval and announcement of the hall and stand number. Especially with regard to the extensive planning efforts for larger trade fairs and the associated necessity to appropriately and reasonably adapt to the situation, the court deems it appropriate if a binding commitment to a stand is first made available at this time.

Organising a trade fair, which primarily consists of ensuring there are no gaps in exhibition halls, justifies a compensation claim of up to 25% of the agreed upon participation fee for administration fees and lost profit, regardless of whether or not the stand has been redistributed, should the exhibitor withdraw from the trade fair.

Even if a stand has been redistributed, the organiser may lay claim to the complete payment of the participation fee if other stands must be moved. In order to receive verification that the withdrawal led to no loss of profit, the withdrawing exhibitor must provide proof that a replacement has been found for the stand and that all other stands have been booked. 


Exhibitor Contract

In principle, anyone who belongs to the group of participants of a trade fair may participate in the event in accordance with the provisions applicable to all participants. The organizer may, however, if it is necessary for the achievement of the purpose of the trade fair, restrict the event to certain groups of exhibitors, groups of suppliers and groups of visitors, provided that this does not result in similar companies being treated differently without an objectively justified reason.

The contract between exhibitor and organizer is a special contract that covers numerous services provided by the organizer. These usually include, in addition to the provision of stand space, the technical supply of electricity, gas, water, heat, telephone and Internet access to the stands. Often, organizers also take on the planning, design, construction, dismantling and cleaning of exhibition stands, as well as the provision of stand components and furnishings. Furthermore, the contract may include that the organizer provides stand supervision and stand security. The organizer's target-group-specific visitor marketing ensures that the supply and demand of an industry are comprehensively represented at the trade fair. Extensive advertising measures and trade fair catalogs ensure that potential customers and suppliers find each other efficiently. Finally, the organizer regularly offers the preparation and implementation of forums, special shows, press conferences, opening events and exhibitor evenings. 

Since uniform rules for all exhibitors and a homogeneous trade fair image, as well as compliance with all relevant safety regulations by each individual exhibitor, are crucial to the success of a trade fair, the organizer's contracts regularly define in detail the scope of rights and obligations of exhibitors during the trade fair. The contractual conditions between the exhibitor and the organizer are generally determined by the general and special conditions of participation specified by the organizer as well as the technical guidelines.       



 




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