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, individuals considering the purchase of a car are advised to carefully review the terms of the sales contract before signing it, paying particular attention to the following points:

• Delivery time: The delivery timeframe should be clearly specified. If it is relatively long, attention should be paid to any indexation clauses that may involve an increase in the sale price at delivery or a decrease in the buyback value of a trade-in vehicle. Therefore, buyers should not hesitate to ask the professional for explanations or request modifications to certain clauses if they find them unacceptable.
• In the case of a loan: If the car purchase is financed through a loan, it is recommended to include a suspensive clause in the contract to ensure that the buyer is not contractually bound if the loan application is rejected.

Furthermore, a distinction should be made between contracts concluded at the professional's premises and those concluded remotely or outside their premises:

• For remote or distance contracts: The consumer has a 14-day right to withdraw (without needing to provide a reason);.
• For contracts signed on-site: The right to withdraw does not apply. However, the seller may voluntarily offer a contractual right to withdraw. In such cases, the terms (how and when) must be clearly stated on the order form. This option is not a legal obligation for the professional.

It is important to note that if consumers unilaterally decide to terminate the contract, they risk having to pay damages to the professional or, where applicable, the penalty amount specified in the contract. The professional is entitled to enforce the contract and require the consumer to accept the vehicle under the agreed conditions.

Additionally, it is essential to remember that the Code of Consumption requires all prices to be clearly stated, easily identifiable, and legible. Consequently, professionals cannot charge prices higher than those indicated, specifically:

• For the sale of a displayed model: The professional is bound by the posted price.
• For the order of a new vehicle: The professional is bound by the price stated in the sales contract and cannot unilaterally impose a higher price. This applies to prices displayed in the sales premises as well as those on the order form or contract. Sales prices must include VAT and all applicable taxes, excluding any potential state subsidies.
• In the presence of an indexation clause: It must be clear, understandable, and detail the recalculation method.

If the sale price is higher than the stated amount, the consumer has the right to seek contract termination through legal action.

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.

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.