Autofestival : What you need to know about contracts

The Autofestival is an unmissable event that attracts many consumers in search of the latest vehicle models and great deals. Various contracts are concluded between car professionals and consumers, such as purchase, credit and leasing contracts. In this regard, it should be noted that professionals are obliged to provide clear and comprehensible information to consumers before any contract is signed. 

Purchase contracts

In general, a distinction must be made between contracts concluded on the professional's premises and distance contracts or an off-premises contracts:

• Consumers who conclude a distance contract have a 14-day right of withdrawal (without having to provide a reason) (https://gd.lu/5kSlfg);
• This right does not apply to contracts other than distance or off-premises contracts. However, it is possible for the seller to grant a contractual right of withdrawal. This agreement must be clearly indicated on the order form and this possibility does not constitute an obligation on the part of the trader.

It should also be pointed out that if the consumer decides to terminate the contract unilaterally, he or she is exposed to the risk of having to pay compensation to the dealer or of having to pay the amount stipulated in the penalty clause in the contract. The professional is entitled to demand fulfilment of the contract and to force delivery of the vehicle.

Leasing contracts

Be careful when signing a "car leasing contract with no obligation to buy", i.e. a contract in which a person leases a vehicle for a fixed period, usually several years, without being obliged to buy the vehicle at the end of the contract! A recent ruling by the Court of Justice of the European Union has confirmed that consumers who conclude such a car leasing contract do not have a right of withdrawal, unless they have not been properly informed of their rights and obligations: https://gd.lu/nSP1V

Consumer credit contracts

For consumer credit contracts, the consumer has a 14-day right of withdrawal. Note that this withdrawal period only begins to run once the consumer has received complete and accurate information. 

Formation of a contract

It should be remembered that signing an order form entails the formation of a contract with the professional. By signing an order form, both parties are validly bound to perform the contract, i.e. the professional must deliver the vehicle ordered and the consumer must pay the price stipulated in the document.

Final recommendation

To summarize, consumers are strongly advised to remain vigilant and to take the time to read and understand the terms of contracts before signing them, to avoid complications later on.