Right of with­draw­al: what customers and store operators should know

If goods ordered online aren’t to their liking, customers can exert their statutory right of with­draw­al. Read on to find out more about the statutory right of can­cel­la­tion, which purchases, products, and contracts it does and doesn’t apply to, and how online store operators can formulate and implement a can­cel­la­tion policy correctly.

The right of with­draw­al is enshrined in the Consumer Contracts Reg­u­la­tions which came into force in 2014 and applies only to goods bought online, via mail, or on the phone. Here, the 14 days are con­sidered a cooling-off period that allow consumers to see and inspect a product in person. The right of can­cel­la­tion states that customers can revoke an online purchase within 14 days of receipt of the goods without reason. In other words, they can declare the purchase or contract as invalid.

The reg­u­la­tion does not apply to purchases made in-store as the le­gis­lat­or assumes customers had suf­fi­cient time to check the goods before making a purchase. In this case, a seller may still accept a return, but they are not legally required to do so.

Online shoppers will find that they can often return goods after the statutory 14 days, sometimes 30 days or even 60+ days after they made the purchase. The maximum cooling off period extends to one year. That’s because many stores provide an optional right of return policy. This is not a legal re­quire­ment, but a goodwill on the part of the retailer. Where goods are damaged or defective, whether they were bought in-store or online, a buyer’s statutory rights or guarantee applies.

Buyers may revoke contracts and purchases that were arranged by ‘distance selling’. This applies to trans­ac­tion made through one or more of the following channels:

• Internet
• Telephone
• Fax
• Mail

For the right of with­draw­al to apply, distance selling must be a mer­chant's primary method of sale. If you order something via phone from a nearby shop as an exception, the right of with­draw­al does not apply. The same is true for purchases from private in­di­vidu­als, for example, if you purchase goods via clas­si­fied ads.

Goods offered by business sellers online must meet certain con­di­tions, including sat­is­fact­ory quality, they must be as described and fit for purpose. For private sellers, goods must only be ‘as described’. Where a seller finds the item does not meet these con­di­tions upon delivery, they can invoke their right to cancel.

The statutory consumer can­cel­la­tion rights do not generally apply to purchases made in-store or on-site. However, there are ex­cep­tions to this rule. If goods are faulty, buyers can always return them ir­re­spect­ive of the seller’s return policy. Sellers are also not allowed to simply refer customers to the man­u­fac­turer but must take back the item and issue a refund if requested.

Many high street retailers offer a 14-day or 30-day return policy. Any goods returned will usually need to be returned in ‘as new’ condition, that is unworn or unused, with the tags still intact. Returns may not apply that were on sale and often stores will need to see a receipt (paper or elec­tron­ic) to process a refund. Depending on a retailer’s policy they may offer store credit instead of a return of funds.

Since the coronavir­us pandemic, ‘Click & Collect’ has really taken off. A shopper’s right of with­draw­al here depends on their con­trac­tu­al method of payment. If an item was bought online, the right to cancel as stip­u­lated above applies – ir­re­spect­ive of payment or col­lec­tion method. If goods were only reserved online and purchased i.e., paid for in-store, the statutory right of with­draw­al does not apply.

If you made a purchase and wish to withdraw, you must notify the seller of your decision in writing. You don’t need to give them a reason. Many retailers provide a with­draw­al form online or enclosed with the delivered goods. Fill out and sign the form and place it in the package with the goods to return before shipping your return ideally via tracked mail services or email. You should ask for a written con­firm­a­tion of your return.

If no can­cel­la­tion form is enclosed with the goods received, you can use the following template as a guide. In your email or letter, enter your address and that of the business or store, your customer and/or order number and the date of your purchase.

Subject: Return of goods

Dear [company name]

Herewith, I would like to revoke the contract I concluded [insert de­scrip­tion goods, date, item number]. Please issue written con­firm­a­tion of my can­cel­la­tion.

The law provides for a can­cel­la­tion period of 14 days. However, a cooling-off period does not begin until buyers have received their goods. As such, goods received, for example, on the 10^th of the month may be returned until the 24^th. On the other hand, if buyers concluded a contract for a service, for example, a new broadband in­stall­a­tion, the cooling-off period begins with the day of con­clu­sion of the contract.

In principle, weekends and public holidays count towards the deadline, but the period may not end on a Saturday, Sunday, or public holiday. If this is the case, the end of the deadline is postponed to the next working day.

Aside from purchases made in-store, can­cel­la­tion rights do not apply to the following:

• Ac­com­mod­a­tion, transport, or other services provided for on a specific date
• Food and drink de­liv­er­ies
• Travel packages
• Premium telephone services
• Cus­tom­ised items, i.e., goods man­u­fac­tured to a customer’s spe­cific­a­tions
• Per­ish­able goods
• Un­re­turn­able items
• Re­cord­ings, music downloads, software
• News­pa­pers and magazines
• Financial market goods affected by market fluc­tu­ations

In addition, there are some instances where a buyer’s right to return expires:

• A buyer can no longer withdraw from a trans­ac­tion if they concluded a contract for a service that has already been provided in full ahead of its deadline. However, this option must have been included in writing upfront.
• Purchase of digital content such as movies. Once a download concludes or a stream begins, the purchase is final.
• Sealed items: once a seal is broken the item cannot be returned.
• In case of sealed or packaged goods that can sub­sequently no longer be sold for health and hygiene reasons. Underwear and swimwear, however, must usually be accepted for return under a buyer’s statutory rights.

Once a buyer cancels a sale, they must return the unused goods to the retailer within 14 days. Some goods need not be returned in their original packaging.

After return of the goods, the merchant will issue a refund of the full purchase price plus original shipping costs. Ad­di­tion­al costs, for example for an express delivery, are excluded from a refund. In some cases, buyers assume the cost to ship a return. However, many business sellers provide the option for shoppers to return their goods free of charge to promote brand loyalty.

Goods damaged by a buyer or those otherwise reduced in value before a return may incur com­pens­a­tion from a seller. However, this does not apply to unpacking and testing an item or trying it on. For example, a buyer can assemble furniture or set up a new tele­vi­sion without giving the retailer reason for a claim for com­pens­a­tion. In the case of services, you only have to pay for the expenses that were demon­strably incurred up to the time of with­draw­al.

Please note the legal dis­claim­er relating to this article.