Servitization: Opportunities and Challenges for Consumer Protection

Description

Servitization, as a business model, supports the circular economy by shifting from product ownership to product use, through various Product-Service Systems. These systems are increasingly used in a B2C context, ranging from ‘pay-per-use’ household appliances to the Product-as-a-Service concept, where bikes or clothes are rented. They can encourage producers and users to use resources more sustainably. By taking responsibility for lifecycle costs, producers may be more inclined to optimize energy use, apply recycling, focus on durability, and prolong product lifespan. However, there are also risks involved. Servitization is not necessarily sustainable. The lack of ownership may not provide an incentive for consumers to take good care of products. Furthermore, consumer protection in these models is not guaranteed.
Consumer protection rules at the EU and national levels primarily cover sales contracts, with service contracts being less regulated. As a result, consumers have less protection in the context of servitization. Subscription-based access models, for example, involve regular payment obligations for consumers, which can strain their monthly budgets; yet the protections offered by consumer credit law may not apply. Rental or leasing contracts only qualify as consumer credit contracts under the Consumer Credit Directive (2023/2225) if they contain an obligation or option to purchase the object. The replacement of ownership by access involves its own risks, inter alia in terms of creditworthiness of consumers and protection against bankruptcy of the service provider.
This contribution explores the opportunities and challenges associated with the sustainable implementation of various forms of servitization. The focus will be on identifying consumer protection gaps within the context of servitization and (briefly) considering possible regulatory approaches to address these issues. The aim is to examine how a future legal framework could play a pivotal role in enabling and encouraging sustainable servitization while simultaneously maintaining a high level of consumer protection.

Period	23 Jul 2025 → 25 Jul 2025
Event title	GLOBAL CONFERENCE International Association of Consumer Law : New Challenges in Consumer Law: Celebrating 40 Years of the United Nations Guidelines for Consumer Protection and the Founding Fathers of the IACL
Event type	Conference
Conference number	19
Location	Buenos Aires, ArgentinaShow on map
Degree of Recognition	International