EUGH: No second right of withdrawal if trial subscription turns into paid subscription!

A consumer has a single right to cancel a subscription taken out at a distance, which is initially free and is automatically renewed

Key Facts

Consumers have a one-time right to cancel a distance selling subscription with initial free of charge.
Sofatutor offers 30 days free trial subscription, cancelable at any time within the trial period.
At the end of the 30 days, the subscription is automatically renewed if it is not canceled.
The Association for Consumer Information (VKI) demands a right of withdrawal due to the conversion into a paid subscription.
The Austrian Supreme Court has asked the ECJ to interpret consumer rights.
Consumers must be clearly informed about chargeable status after the trial period.
No clear information allows the consumer a renewed right of withdrawal.

The situation is different if the consumer was not adequately informed about the total cost of the subscription. The company Sofatutor operates Internet learning platforms for students. When taking out a subscription for the first time, it can be tested free of charge for 30 days and can be cancelled without notice at any time during this period. The subscription only becomes chargeable after these 30 days.

If the paid subscription period expires without cancellation, the subscription will be automatically renewed for a specified period.

In case of a distance contract conclusion, Sofatutor informs consumers about the right of withdrawal (right of revocation). However, the Association for Consumer Information (VKI) is of the opinion that the consumer is entitled to a right of withdrawal (right of cancellation) not only due to the conclusion of a 30-day free trial subscription, but also due to the conversion of this subscription into a paid subscription and its extension. The Supreme Court (Austria), which is hearing the case, asked the Court of Justice to interpret the Consumer Rights Directive1 in this regard.

The Court answers that, in principle, the consumer has the right to withdraw from a distance contract only once in the case of a subscription contract which initially provides for a free period and is automatically renewed if that contract is not terminated.

However, if the consumer was not clearly, understandably and explicitly informed at the time of subscription that this subscription would become chargeable after a free initial period, he must have a new right of withdrawal.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.