Debate: Commission proposal kills many youth jobs

Anne-Marie Fransson et al: The consultation round for the report "Strengthening consumer protection in telemarketing" has ended and sharp criticism is being voiced by both industry organizations and individual companies. The proposal to introduce a requirement for written contracts in telemarketing threatens 10,000 jobs - especially for young people.

If businesses cannot sell, they cannot survive. Telephone sales are essential to industries such as newspapers, electricity, book clubs, insurance, telephony and television services. It is difficult to estimate how many jobs depend on the revenue generated by telephone sales, but around 30 000 people are currently employed directly in telephone sales and service, while 100 000 or so work in the industries concerned.

The report proposes that, after accepting an offer verbally, consumers should receive a written contract which should then also be confirmed in writing. In a report published in June 2015, the Swedish Trade Research Institute (HUI) noted that this would lead to a significant increase in administrative costs for businesses and a loss of sales of at least 34%. Some industries risk a loss of sales of up to 70%. Not because the offer was not good, but because consumers shun hassle. These figures are dismissed by the investigator without further justification.

Service and sales over the telephone is an important first job for young people and people without education, 45% of all employees are currently under the age of 24, many of them in sparsely populated areas. The report's proposals have a direct impact on these important entry-level jobs and indirectly on other employees in the industries concerned. We are talking about 10,000s of jobs. In Norway, a requirement for written contracts was introduced in 2009 and the result was that the number of employees in the call center industry alone fell by 22%. Most remarkable, however, is that the problems with rogue operators have not stopped.

Companies that trick and pressure consumers into contracts they do not want to enter into are a major problem for each individual affected, but also for all legitimate businesses, which suffer a bad reputation and find it more difficult to recruit employees. In 2014, around 10 operators accounted for 48% of all complaints related to telemarketing. These are very few companies, but their unscrupulous activities affect many. It is now important to target these few actors. Industry is advocating three measures that would help strengthen consumer protection and enable sellers to operate on a level and fair playing field:

1. strengthen the Consumer Agency's resources for supervision

The Consumer Ombudsman's ability to carry out effective market surveillance should be strengthened. This should primarily be done by providing the authority with additional resources in order to be able to follow up more quickly on companies that cause consumer problems. We know this has an effect.

2. develop uniform written confirmations

A uniformly designed written confirmation of a verbally concluded contract would create the required reflection time - without the hassle of sending out a written contract with a requirement for written acceptance in return. A written confirmation can provide information about the content and scope of the contract, the statutory right of withdrawal and where to go to exercise it.

3. enables recording of entire sales calls

Introduce a requirement to record the entire sales call, which is then made available to both the consumer and the company in a legally secure way. Today, only the confirmation of the contract is recorded. It is then unclear what the seller has promised.

The Minister for Consumer Affairs, Per Bolund, has stated that rogue traders must be prevented without harming honest companies with well-functioning business methods (Västerbottens-kuriren 10/11). We share Bolund's ambitions and have confidence in the government's willingness to both protect consumers and safeguard the opportunities for serious companies to create jobs and growth. For a government that puts jobs first, this is fundamental.

Ulf Lindberg, Head of Industrial Policy at Almega

Anders Berglund, CEO, Direct Selling Sweden

Anne-Marie Fransson, Director of the IT&Telecom Confederation

Tina Wahlroth, CEO, Contact

Niklas Briselius, General Counsel, Swedish Advertisers

Jonas Ogvall, CEO, Swedish Digital Trade

Peter Nyström, CEO, Swedish Marketing Association

Tore Thallaug, CEO, SWEDMA

Kerstin Neld, CEO, Swedish Magazines

Per Hultengård, General Counsel, Swedish Newspaper Publishers Association