Frequently asked questions
about the Federation of German Consumer Organisations (vzbv)
- Can one also get advice directly from the Federation of German Consumer Organisations?
- How do the Federation of German Consumer Organisations and the consumer centres work together?
- How is the work of the Federation of German Consumer Organisations financed?
- If most of the money comes from the Federal Ministry of Consumer Protection - how independent can the Federation of German Consumer Organisations really be?
- Is there an alternative to funding from the state?
- What is the difference between the Federation of German Consumer Organisations and the Stiftung Warentest consumer information service?
- How does the Federation of German Consumer Organisations determine the priorities of its work?
- What has the Federation of German Consumer Organisations achieved for the consumer with its lobbying work up till now?
- How successful are the legal actions brought by the Federation of German Consumer Organisations?
1. Can one also get advice directly from the Federation of German Consumer Organisations?
No. Providing information and advising consumers is exclusively the task of the consumer centres in the individual federal states. The federal umbrella body provides support for the consumer centres in meeting this important task.
2. How do the Federation of German Consumer Organisations and the consumer centres work together?
As an umbrella organisation, the Federation of German Consumer Organisations supports the consumer centres by providing up-to-date information for consumer consultations. For instance, the federation finances and promotes the national "consultation standards" - which refers to answers to questions frequently asked by consumers during advice sessions. Working groups constantly bring these answers into line with current information.
The consultation standards can be accessed by all consumer centres via a shared intranet. In order to ensure that consultants are able to provide reliable information and are always aware of the latest developments, the Federation of German Consumer Organisations also offers a comprehensive programme of qualification and further training involving some one hundred workshops and seminars annually.
As the "voice of the consumer" the national federation relies on information passed on to us by the consumer centres on the basis of their dealings with consumers - such information often serves to help improve our legal position. In this sense the concrete experiences of consumers play a central role in our political lobbying work and in our efforts to promote consumer rights in court.
3. How is the work of the Federation of German Consumer Organisations financed?
Some 85 per cent of the core budget is provided by funding from the Federal Ministry of Consumer Protection, Nutrition and Agriculture. The basis for this is the federal budget, which is decided on annually by the German Bundestag. Other funding comes from membership fees and from the sale of consumer advice guides.
In addition the federation engages in a series of projects such as the programme of national energy consultation by the consumer centres. These projects are financed by different federal ministries and by funding from the European Union. A complete overview of our budget is available in our Annual Report [pdf file, 1,9mb].
4. If most of the money comes from the Federal Ministry of Consumer Protection - how independent can the Federation of German Consumer Organisations really be?
In political terms the Federation of German Consumer Organisations sees itself as obligated to one single interest group - the consumers. As a registered association, the national federation itself decides on the content and emphases of its work. The political independence of the Federation of German Consumer Organisations and its predecessor (AgV - consortium of consumer associations) has always been respected by the federal government. The Federation of German Consumer Organisations is in no sense tied to directives by the Federal Ministry of Consumer Protection. And with regard to questions of personnel, such as the appointment and discharging of its board, the Federation of German Consumer Organisations also has full autonomy.
This independence is also reflected in press releases and the public positions taken by the Federation of German Consumer Organisations, in which both praise and criticism of the federal government and the Ministry of Consumer Protection can be found.
5. Is there an alternative to funding from the state?
The work of the Federation of German Consumer Organisations involves the search for a compromise between the interests of business and those of consumers, since without a sensible balance between supply and demand an economy cannot function.
The same is true of the enforcement of consumer-protection laws by way of the right as an association to institute legal action: the state does not exert direct control here but relies the fact that the prevailing laws and the fundamental rules of the market and competition will be enforced by the consumer associations. For without effective enforcement, even the best laws have no meaning.
There are thus good reasons for state funding being provided for our work. At the same time, businesses also profit: in highly complex markets, quality-oriented businesses will only be able to sell their products to well-informed consumers who know and insist on their rights. We can illustrate this with an example. Most Germans are poorly insured. They have taken out insurance that they do not need and at the same time are often not insured against the most elementary risks to life and limb. It follows that all those insurance companies offering well tailored insurance solutions would profit from consumers who knew exactly what sort of insurance they needed.
Against this background, the Federation of German Consumer Organisations is proposing that business contributes to the provision of independent consumer information and advice. We propose the establishment of an independent foundation to which both the state and the individual branches of the economy would participate.
6. What is the difference between the Federation of German Consumer Organisations and the Stiftung Warentest consumer information service?
The Federation of German Consumer Organisations and the Stiftung Warentest consumer information service have clearly delineated areas of work and tasks. Whereas the Federation of German Consumer Organisations represents the political interests of consumers, Stiftung Warentest promotes market transparency by testing products and services. At the same time Stiftung Warentest is obliged by its association articles to maintain political neutrality.
Despite their clearly separate tasks, the Federation of German Consumer Organisations and Stiftung Warentest work closely together. The two organisations are also linked institutionally: Stiftung Warentest supports the Federation of German Consumer Organisations as a sustaining member, while the Federation of German Consumer Organisations is represented on the administrative board, the board of trustees and the advisory council of Stiftung Warentest.
7. How does the Federation of German Consumer Organisations determine the priorities of its work?
The emphases of our work are decided on by the General Meeting of the Federation of German Consumer Organisations, in which all membership organisations are represented. The basis of decision-making is provided by proposals tabled by the Federation of German Consumer Organisations branch office headed by the management board in Berlin. Further information about the structure and committees of the Federation of German Consumer Organisations can be found on the website of the Federation of German Consumer Organisations and in its articles of association.
8. What has the Federation of German Consumer Organisations achieved for the consumer with its lobbying work up till now?
The following cases provide good examples of the Federation of German Consumer Organisations standing up for the interests of consumers and the successes we have achieved:
- Energy prices: The liberalisation of the electricity and gas market in Germany has failed. The market is dominated by large monopoly enterprises and these are stifling all competition. The costs are being met by the consumer. And the current economic situation - since high prices in Europe for gas and electricity are skimming off billions in potential purchasing power. For this reason the Federation of German Consumer Organisations has been campaigning forcefully for some years for effective regulation of the electricity and gas market in Germany.
- Current accounts:Without access to a current account, payment can be extremely costly.
And yet it is precisely those people in a socially weak position who regularly find that banks deny or cancel their current account. For several years we have been arguing for changes that would allow every consumer to have a current account based on credit balance. In the meantime all parties in the Bundestag have given their support to this demand
– an important step towards the establishment of a legally secured right. - Problems caused by medication - a precedent:Patients who suffer severe problems as the result of taking medication have until now been left to suffer alone. In order to have a claim to compensation they have had to prove a causal connection between the taking of the medication and their subsequent problems - an extremely difficult undertaking. Now pressure from the Federation of German Consumer Organisations has brought about a change in the law such that the burden of proof is on the supplier. The manufacturer now has to prove that the damage sustained by the patient has not stemmed from taking the medication.
- Consumer deception: In a situation of fair competition deception of the consumer cannot be rewarded. Nevertheless unfair business practices have repeatedly brought financial rewards. Even if consumer centres and the Federation of German Consumer Organisations could bring a stop to such practices through the courts, the financial gains would remain in the hands of the businesses involved. Pressure from the Federation of German Consumer Organisations has resulted in new measures to confiscate profits gained unjustly and these can give consumers new hope. We have yet to see how successful such measures are in practice. Nevertheless the move towards the confiscation of illegally gained profits represents a signal that consumer protection and economic success go hand in hand.
9. How successful are the legal actions brought by the Federation of German Consumer Organisations?
Every year the Federation of German Consumer Organisations pursues some 300 cases against advertising practices that are misleading or make use of dishonest means. The federation is particularly successful in this area. As a result, numerous businesses commit themselves to withdrawing the advertising concerned even before the case is brought to court. And in the cases where the Federation of German Consumer Organisations has to enforce its position in court it achieves a high rate of success.
Based on its right as an association to institute legal action, the Federation of German Consumer Organisations also takes action against the use of contract clauses which result in a one-side disadvantage for the consumer. In some 100 cases per year the Federation of German Consumer Organisations regularly achieves changes in the interest of the consumer.
We point here to two cases which are representative of the many prosecuted by the Federation of German Consumer Organisations and for which the federation was forced to go all the way to the German Federal Supreme Court - and won:
- German Federal Supreme Court (BGH) judgement: Consumers must be able to check bills
Mobile telephone customers may only be obliged to pay their bill via direct debit authorisation in cases where the period between the issuing of the bill and the debiting of the customer's account is at least five days. This decision was reached by the German Federal Supreme Court in a judgement against Deutsche Telekom MobilNet GmbH (DeTeMobil) after the Federation of German Consumer Organisations brought an action against the mobile telephone company and demanded a high court decision on the matter. The judges shared the view of the Federation of German Consumer Organisations that the customer must be given enough time to check the bill and ensure that there are adequate funds on the current account to cover it.
(Urteil des BGH vom 23.01.2003, Az.: III ZR 54/02) - German Federal Supreme Court (BGH) judgement: Guaranteed returns for silent partnerships misleading
An advertisement for a capital investment is misleading if the naming of a minimum interest rate leads to the incorrect belief that a certain return is guaranteed. This judgement was brought down by the German Federal Supreme Court as a result of an action brought by the Federation of German Consumer Organisations in September 1999 against Lenz Immobilienhandel AG.
The company taken to court by the Federation of German Consumer Organisations had offered potential investors participation in the public company as atypical silent partners by way of single payment or instalment investment payments. Among other things the company offered a "annual average minimum interest rate of six per cent of the amount invested at the time irrespective of results" in its share issue prospectus. With its judgement, the Federal Supreme Court confirmed the opinion of the Federation of German Consumer Organisations that the advertisement conveyed the incorrect impression that the offering involved a capital investment with a guaranteed return. However, the company was not in a position to guarantee its silent partners an annual minimum return of six per cent on the invested capital irrespective of the company's success.
Urteil des BGH vom 02.10.2003 - Az: I ZR 252/01
