This chapter will discuss the legal framework for consumer and data protection in Europe. Central to this discussion will be the law of the European Union (EU) on data and consumer protection.3 Recent years have seen the creation of legal frameworks in Europe which seek to secure the protection of consumers while simultaneously facilitating economic growth in the European Union. This chapter will outline the main sources of law which protect consumers and their privacy. This chapter will outline the important provisions in these sources of law and critically analyse them. The chapter will also point up the gaps and deficiencies in the consumer and data protection legal structures.
The European Union And Legislative Initiative
The European Union (EU) has become the driving force for the initiation of policy development in many diverse areas for its member states. Data and consumer protection are cogent examples of this. The concept of European Union can be confusing, therefore it is perhaps best at this point to describe the method by which the EU can direct this change.
The EU was created as recently as 1993 by the Treaty on European Union. The EU is an overarching entity which contains three-pillars, the pre-existing European community (EC) pillar, the justice and home affairs pillar and the common foreign policy and security policy pillar.5 The concept of a common market is a fundamental aim of the European Union and its policies have been heavily influenced by this. Under Article 211 EC, the European Commission has been given extensive powers such as its right of legislative initiative to ensure the proper functioning and development of the common market. There are three modes of community lawmaking employed by the commission: regulations, directives, and decisions for a more lengthy discussion on community law-making (Craig & de Búrca, 2003).
Regulations are binding upon and are directly applicable in all member states. Directives may not be applicable to all member states and are binding only on the end to be achieved and leave flexibility with the member states on the mode by which this “end” is achieved. Decisions are binding in their entirety on those to whom they are addressed under Article 249 (ex Article 189) EC.
The European Union has provided a legal framework for e-commerce. The creation of this framework through a series of directives tied in with the goal of creating a European single market (Directive 2000/31/EC  O.J. L178/1 and Directive 1999/93/EC  O.J. L13/12). The rationale of the European Commission in bringing forward these directives was to inspire confidence in e-commerce. These directives were introduced to facilitate the development and expansion of e-commerce and the content of these directives do not limit or restrict e-commerce (Keller & Murray, 1999; Anassutzi, 2002).These directives primarily dealt with the following issues:
The legal status of electronic contracts and digital signatures
The legal liability of intermediary service providers
The freedom to provide services