Background to the Provisions of Services Regulations
The provisions of services regulations
have been established as a result of the European Directive.
Provisions came into force in the UK on 28th December 2009
and have potentially a far reaching effect on a wide range
of businesses. One of the main aims of the regulations was
to make the provision of services across the European
Economic Area (EEA) easier and more transparent as well as
ensuring that purchasers are furnished with the correct
information relating to the supplier at the earliest
possible opportunity or in any event before they have agreed
formally to use the services.
Key Provisions in the Provisions of
Services Regulation
At the centre of the regulations is
the list of information that must be provided to the
customer (whether they be a consumer or a business).
Critically this information must be given prior to the
customer becoming obliged in any way to make any payment.
For example the information would have to be given before
the service is performed or before any contract is signed.
Typically this will be problematic for
the types of businesses that do not provide information such
as contact details to their customers before they begin to
undertake services. For example in the building trade where
the first bit of written documentation is often the invoice.
Customers are also not always aware of whom they are dealing
with, particularly where there are multiple addresses or
trading names being used.
The provisions also deal with the need
to have available a written complaints procedure which a
customer can ask to see at any point, again offering
consistency and safeguards for those receiving services from
others.
What is a Service under the
Provisions of Services Regulations?
One of the initial questions that is
raised under this provisions of services regulations is that
of who exactly is considered to be a service provider and
what exactly a service is? It is a common misconception that
services are only provided by businesses to customers but in
reality it can also cover a business to business situation
and can potentially cover organisations that do not
necessarily view themselves as being service organisations.
Organisations such as restaurants,
accountants, beauticians are all clearly service providers
whether they are servicing individuals or businesses and
would fall within this category. Others are slightly less
obvious and may only have a marginal service element for
example whilst a retailer may be selling goods which are not
considered a service any ongoing maintenance of these goods
would result in it being deemed a service and therefore
caught by these regulations.
Information that must be made
Available
A critical issue to remember under the
regulations is that all information must be provided to the
customer BEFORE the contract is entered into or before the
services are delivered or used. This is to ensure that the
customer fully aware of whom they are dealing with and on
what terms. Information that has to be provided includes the
full correspondence address of the business (the official
address if it is registered) contact details for a rapid
response i.e. email or fax and the details relating to any
VAT registration or any registration with a professional
body.
Terms and conditions must also be
given including not only the nature of the services that are
to be provided but also including details of the price that
will be charged, or if this is not known the way in which
the price will ultimately be calculated. All of this must be
given initially and services providers need to also ensure
that they have a complaints process in place that can be
given out on request.
Related Issues with the Provisions of
Services Regulations
Ways of making information available
Depending on the nature of the
organisation the way in which the information will be passed
through to the customer will vary. For example for many
professional firms such as lawyers and accountants there
will already be a standard form of letter in place that
tells new clients of this information. Other industries are
not so well prepared for this move and will need to
seriously adapt their working ways.
A great way of providing all of the
info is in a terms of business letter with contact details
and charges. Other options include a more detailed order
note that can be used or even making the information clearly
visible on the website (although the need to provide
detailed estimates would still need to be satisfied).
Complaints
handling obligation
A specific area that has been targeted
under these regulations is that of complaint handling.
Whilst it is not necessary to inform every new customer of
the complaints handling process it is necessary to have such
a process in place. Complaints need to be dealt with
promptly. Best efforts need to be used in dealing with
complaints and a set process which need to be in place and
readily available for any customer who wants them. Again
contact details need to be included to ensure that customers
know to whom they should address complaints.
Action Points
- All service providers need to
review their processes to see whether they currently
provide all of the necessary documentation.
- Consideration needs to be given
to terms and conditions of businesses to ensure they
comply
- Complaints processes need to be
looked at to ensure compliance
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