C-237/97

4. The remaining paragraphs of Article 2 con­ 2. The purpose of Council Directive tain further definitions which relate to the 90/314/EEC of 13 June 1990 on package parties to the contractual relationship. An 1 travel, package holidays and package tours organiser is 'the person who, other than occa­ (hereinafter 'the Directive') is, as stated in sionally, organises packages and sells or offers Article 1, to approximate the laws, regula­ them for sale, whether directly or through a tions and administrative provisions of the retailer'. A retailer is 'the person who sells or Member States relating to packages sold or offers for sale the package put together by the offered for sale in the territory of the Com­ organiser', and, finally, a consumer is 'the munity. person who takes or agrees to take the package ("the principal contractor"), or any person on whose behalf the principal contractor agrees to purchase the package ("the other benefi­ ciaries") or any person to whom the principal contractor or any of the other beneficiaries transfers the package ("the transferee")'.

3. Under Article 2(1) of the Directive, a package means the pre-arranged combination

* Original language: Italian. 5. The provisions which follow clarify the 1 — OJ 1990 L 158, p. 59. content of the respective rights and obliga-

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OPINION OF MR SAGGIO — CASE C-237 C-237//97

8. The case before the national court is 6. The next significant article is Article 7 of brought by AFS Intercultural Programs Fin­ the Directive, according to which 'the orga­ land (hereinafter 'the Association'), a non­ niser and/or retailer party to the contract shall profit-making association established under provide sufficient evidence of security for the Finnish law. The Association's object is, refund of money paid over and for the repa­ according to its statutes, to promote interna­ triation of the consumer in the event of insol­ tional co-operation and exchanges between 2 vency'. various cultures. To this end, the Association, like its sister organisations in other countries, organises international student-exchange pro­ 2 — The Court has already ruled upon the Interpretation of Article grammes, arranging for Finnish students to 7 of the Directive in Joined Cases C-178 C-178//94 94,, C-179 C-179//94 94,, stay abroad and for foreign students to stay C-188 C-188/ /94 94,, C-189 C-189/ /94 and C-190 C-190//94 Dillenkofer and Others 1996]] ECR I-4845 [ 1996 I-4845,, and in Case C-364 C-364//96 Verein für Komu- in Finland. The students who participate in menleninforma ion [1998 1998]] ECR 1-2949 1-2949.. The interpretation of the same provision is also in issue in Case C-140 C-140/ /97 Rech- the programme are between 16 and 18 years berger and Others v Republic of Austria Austria,, which is currently of age and the length of their stay abroad pending before the Court Court,, and in which I gave my Opinion on 25 June 19981998.. varies from 6 to 11 months.

9. The Association arranges transport for the register in an appropriate register. Article 2 of students to the country of their destination the Law explains that the business in ques­ using regular scheduled flights. The students tion is the organising, offering or procuring lodge with families selected in advance by the of package travel. The Law assigns to the Association, which put them up free of charge. Office the task of checking that agencies oper­ The Association also organises short prepara­ ating in Finland comply with the require­ tory courses and occasional joint programmes ments laid down by the Law, among them for the young people attending the courses. being the obligation to provide appropriate During their stay abroad, the students attend security so that consumers of package ser­ local schools. Local volunteers are respon­ vices are guaranteed the refund of money paid sible for organisational matters in the host over and their repatriation in the event of the 3 country. organiser's insolvency. Under the Finnish law, the Office may also prohibit the conduct of such business by any person who is not registered in the register and who has not, therefore, provided the requisite security. It may also impose fines for breach of the requirement to register. 10. As regards the financial arrangements between the parties, it should be noted that the students are required to pay a deposit of approximately 10% of the total cost on admis­ sion to the exchange programme, that is to say about ten months before their leaving. 12. Pursuant to the provisions just mentioned, The balance is then paid in three instalments the Office requested the Association to reg­ before the beginning of the visit. On depar­ ister in the register of package travel organ­ ture, the student receives a pre-paid return air isers. In the Office's opinion, the inclusive ticket. services offered to the students, comprising the journey, the stay with the host family and other ancillary services including the prepara­ tory course for the students concerning the characteristics of the host country, constitute a 'package' to which the provisions relating to package travel had therefore to be applied. 11. The dispute before the national court arises from a request addressed to the Asso­ ciation by the Kuluttajavirasto (or Consumer Protection Office, hereinafter referred to as 'the Office') to register in the register of travel organisers set up under the aforementioned Finnish law relating to package travel firms. 13. The Association did not comply with the That law, which, as mentioned, was enacted request to register, and for this reason, by its to implement the Directive, provides that the decision of 14 October 1996, the Office business of package travel organiser can only ordered the suspension of the Association's be conducted by natural or legal persons, or branch offices of foreign companies or foun­ dations, authorised to operate in Finland, and 3 — These arc the consumer rights set out in Article 7 of the it is to this end that organisers are required to Directive and referred to in section 6 above.

business as organiser of package travel and the scope of Council Directive threatened a fine of FIM 100 000 should that 90/314/EEC of 13 June 1990 on package decision not be complied with. travel, package holidays and package tours? Are certain characteristics which indicate the non-commercial nature of the organiser of the exchanges, such as the facts that participants in the exchange programme are only required to pay part 14. The Association then applied to the of the costs of the programme, that the Finnish Supreme Administrative Court for an exchanges are devised by way of col­ order annulling the decision. It maintained, laboration between non-profit-making first, that it did not carry on the business of associations in various countries, and that package travel organiser, in that the student they rely largely upon voluntary work exchanges could not be classified as package and are financed with public funds set services as defined by the Directive and by aside for cultural activities, relevant to the national transposing legislation, and sec­ the question whether the student ondly that it did not provide transport and exchanges fall within the Directive's accommodation or transport and other tourist scope? services for an inclusive price, and so the con­ ditions laid down by Article 2 of the Direc­ tive and by the corresponding national provi­ sions were not satisfied. (2) In the event that the student exchanges do fall within the general scope of the Directive, the Court is then asked to answer the following questions con­ cerning the detailed interpretation of 15. On the premise that the national law must Article 2: be interpreted and applied in accordance with the Directive's provisions, the Finnish Supreme Administrative Court referred to this Court the following questions for a pre­ liminary ruling: 2.1 Is a long term stay, free of charge, with a family, where the guest is treated almost like a child of the family, to be considered accommo­ dation within the meaning of Article 2(1)(b)? '(1) Does a student exchange of approxi­ mately six months' or one year's dura­ tion, the purpose of which, so far as the student is concerned, is not a holiday or tourism but to attend an educational 2.2 Are the training of the students and establishment in a foreign country and their parents, the selection of the familiarise himself with the people and families and schools in the host culture of that country by staying free of country and the preparation of docu­ charge with a local family as a family mentation relating to the host member fall, wholly or in part, within country to be considered other

16. The first question concerns the scope of 18. As regards the particular features of the the Directive. The national court points to services offered, one must first consider the certain circumstances which, in its view, cast objection raised by the Association in the doubt upon whether the services offered by main proceedings and espoused before this the Finnish Association are package services Court by the United Kingdom Government, within the meaning of the Law on package namely that student visits which form part of travel organisers enacted to implement the an exchange programme and which are there­ Directive. More specifically, the following cir­ fore characterised, on the one hand, by the cumstances are concerned: first, the duration fact that their purpose is not typically that of of the visit, which varies from six months to tourism but, in a broad sense, education, do a year; secondly, the reason for the visit, not fall within the scope of the Directive. In which is not undertaken for tourist purposes other words, the scope of the Directive's or as a holiday, but in order to attend an edu­ application is, it is alleged, limited to a spe­ cational establishment in a foreign country cific category of package services, that is, and to get to know the way of life of the those which clearly have a touristic purpose, people of that country. Also, there is the fact whereas visits for the purpose of attending an that the organiser's business is not conducted educational establishment in a foreign country in order to make a profit, and lastly, the cir­ and thus getting to know the culture of and cumstance that the student pays only part of way of life in that country are, it is argued, the costs of the programme and that the State by definition excluded. In support of this contributes to those costs, using sums set interpretation, the Association and the United aside for cultural activities. Kingdom Government point out that, in sev­ eral places in the preamble to the Directive 4 reference is made to the 'tourist sector' and to the need to introduce a 'Community policy

19. I do not believe that the matters just set out are sufficient to win support for the argu 20. The purposes of the Directive, its wording 8 ment put forward by the Association and the and the preparatory work leading up to it United Kingdom Government. It is necessary disclose nothing to suggest that its scope is to start from the premiss that the interpreta limited exclusively to tourist services. Since tion of the provisions of the directive in ques the Directive is a measure for the harmonisa tion must be informed by the principle, of tion of national laws which has as its main general application, that, in cases of doubt, its objective the protection of the weaker party provisions must be interpreted as far as pos to the travel contract, it is clear that all package sible in favour of the persons for whom the services sold within the territory of the Com protection is intended, that is to say con munity are subject to those requirements of

As observed sections 11 to 14 of the Opinion of Advocate General Tesauro. I believe that this principle of interpretation in the sense most favourable to the consumer is also confirmed by the judg- Konsumenteninformation,, cited above, in ment in Verein für Konsumenteninformation particular at paragraphs 18 to 23 where the Court interpreted broadly the scope of the consumer's right to the refund of 8 — See the proposal submitted by the Commission to the Council money paid over and to repatriation, 'having regard to the on 23 March 1988 (OJ 1988 C 96, p. 5) and the statement of objectives of the Directive, in particular those of Article 7' reasons for that proposal as set out in document COM(88) (paragraph 20). 41 final, the opinion of the Economic and Social Committee 7 — For an exposition of the provisions of the Directive which of 23 February 1989 (OJ 1989 C 102, p. 27) and the opinion permits one to form the principle of interpretation in ques- of the European Parliament, on first reading, of 15 February tion, I would refer to section 17 of and footnotes 5 to 7 to 1989 (OJ 1989 C 69, p. 95) and its opinion on second reading, the Opinion in Rechberger cited in footnote 2. of 16 May 1990 (OJ 1990 C 149, p. 86).

21. Moreover, even if one were to concede that the Directive meant only to deal with 11 — It should be noted in this regard that in certain language ver­ sions of the Directive, Article 2(1)(c)refers to 'other tourist services' not ancillary to transport or accommodation. According to the plaintiff in the main proceedings and the United Kingdom Government, this demonstrates that, in order for the package to fall within the scope of the Direc­ 9 — And also any person on whose behalf the principal contractor tive, the other two components, transport and accommoda­ agrees to purchase the package or any person to whom the tion, must also be offered to the consumer in the context of principal contractor or any of the other beneficiaries transfers services in the nature of tourist services. In this connection, the package. besides what is expressly set out in the text of the Directive to define tourist services, it should be noted that not all of 10 — Sec Council Directive 85/577/EEC of 20 December 1985 to the language versions correspond to the French, English and rotect the consumer in respect of contracts negotiated away E frombusiness premises (OJ 1985 L 372, p . 31) (the first Italian versions. For example, the Finnish version refers to 'other travel services', a concept which appears broader than paragraph of Article 2); Council Directive 87/102/EEC of 22 that expressed by 'other tourist services'. December 1986 for the approximation of the laws, regula­ tions and administrative provisions of the Member States 12 — See, in this connection, Council Decision 92/421/EEC of 13 concerning consumer credit (OJ 1987 L 42, p . 48) (Article July 1992 on a Community action plan to assist tourism (OJ 1(2)(a)); Council Directive 93/13/EEC of 5 April 1993 on 1992 L 231, p. 26). The Annex to the Decision refers to unfair terms in consumer contracts (OJ 1993 L 95, p . 29) Community action in the fields of cultural tourism, rural (Article 2(b)); Directive 94/47/EC of the European Parlia­ tourism, social tourism and youth tourism. In relation to the ment and the Council of 26 October 1994 on the protection last of these, the Decision states that 'Community action in of purchasers in respect of certain aspects or contracts this field is, through support for existing Community poli­ relating to the purchase of the right to use immovable prop­ cies, aimed both at promoting young people's knowledge of erties on a timeshare basis (OJ 1994 L 290, p. 83) (Article cultures and lifestyles in the various Member States and at 2); Directive 97/7/EC of the European Parliament and of the. making it easier for young people to take holidays'. Clearly Council of 20 May 1997 on the protection of consumers in this wording suggests the possibility of combining, in a respect of distance contracts (OJ 1997 L 144, p . 19) (Article single tourism measure, recreational, educational and cul­ 2(2)). tural aspects.

the purpose of the travel. There is nothing, to take are, significantly, the very steps which either in the wording of the Directive or the Association voluntarily takes on behalf of related to its objectives, that can be prayed in the students admitted to the exchange pro aid, to support the conclusion that only 'rec gramme. reational' travel is protected under the sub stantive rules of the Directive and that travel for other purposes (business, conferences, family visits, study, to name but a few) is by definition excluded and therefore not subject to the consumer-protection provisions con tained in the Directive. Quite apart from the 24. The substantive scope of the Directive obvious difficulties of identifying the inten can, therefore, only be ascertained by refer tions of those who enter into package-travel ence to the provisions contained in Articles 1 agreements, the need to prevent the risk, and 2. Thus the services must first of all be mentioned earlier, of the protection which the 'sold or offered for sale in the territory of the Directive aims to provide being evaded mili Community' (Article 1).

accommodation. If all these elements are 23. I think that one can usefully refer to present in the services offered to students by Article 4(1) of the Directive in order to con the Association — and it is a matter for the firm that solution. That provision concerns national Court to establish this — then the the obligation to provide information which protection offered by the Directive must be is imposed upon the organiser and/or retailer guaranteed to the consumers as the weaker of the package services. Article 4(1)(b)(iii) parties to the contract, and any other aspects, expressly refers to journeys and stays abroad such as the purposes of the journey or the by minors, and requires organisers and duration of the stay, can have no relevance. retailers to provide 'information enabling direct contact to be established with the child or the person responsible at the child's place

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AFS INTERCULTURAL PROGRAMS FINLAND

of the services in question from the scope of his business, organises the package and offers the Directive. I refer above all to the non­ it by means of brochures, or other forms of commercial character of the Association's advertising, to the public generally'. 4In its business. In this connection, the national court Opinion, adopted on 23 February 1989, the observes that the Association does not operate Economic and Social Committee said it wished for profit and that those taking part in the to see the definition re-examined, as it con­ exchange programme are only required to pay sidered the one given in the Commission's part of the costs, as the exchanges are partly proposed text unsatisfactory for the very financed from funds set aside by the State for reason that, in referring to the organiser's cultural activities. business, it did 'not include non-professional 1 organisers such as private clubs'. 5

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OPINION OF MR SAGGIO — CASE C-237/97

return or where the monetary consideration The second question referred for a prelimi- demanded from the consumer is imputed to nary ruling one part of the package only. For the same reasons, the fact that the Association's busi­ ness relies in part upon the work of volun­ teers is similarly irrelevant to determining the persons covered by the Directive. What mat­ ters, in short, is simply whether the condi­ tions set out in the Directive are met: an 30. The conclusion I have reached permits .organiser is any person who, other than occa­ me to go on to examine the second question sionally, organises packages and sells or offers submitted by the Finnish court for a prelimi­ them for sale, whether directly or through a nary ruling. That court requests the interpre­ retailer. tation of a particular provision of the Direc­ tive (Article 2(1)) which sets out the elements comprising a package service which are of relevance to determining whether the Direc­ tive applies.

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AFS INTERCULTURAL PROGRAMS FINLAND

in light of their personal qualities. In order to and so on. Clearly, in the case of this type of be admitted, the student's personality is 'reserved' travel, the right of transfer pro­ assessed together with his ability to adapt to vided for in Article 4(3) is not an absolute the place where the programme will take place right. It can only be exercised in favour of and to the intended host family. persons who satisfy the requirements for par­ ticipating in the journey in question. This means that, in all such cases, the organiser is only required to accept substitution by par­ ticular persons. I do not, on the other hand, think there are any grounds for maintaining that the protection afforded by the Directive to consumers of package services — and in particular the protection concerning security 33. In the Commission's submission, there­ for the refund of money paid over and for fore, participation in the study visits is not repatriation — must be excluded merely based upon objective factors. Consequently, because the consumer cannot, with respect to it is not possible in the present case to apply this particular type of travel, transfer his rights Article 4(3) of the Directive by virtue of and obligations under the contract to any which the consumer may, where he is pre­ person he chooses. This would lead to a vented from proceeding with the package, reduction, for no valid reason, in the scope of transfer his booking to a person who satisfies protection, incompatible with the ratio of the all the conditions applicable to the package in Directive which, as already mentioned, question. demands a broad interpretation of the provi­ sions which define its scope.

could only be made in favour of someone irrelevant to determining the scope of the who is selected by the Association to take Directive. It is sufficient, for this purpose, part in the exchange programme, but clearly, that the package is sold or offered for sale at because of the nature of the service and the a price which is referable to the package as a personal relationship which is established with whole. The definition of 'accommodation', in the host family, the family's consent is nev­ its turn, clearly covers any kind of accommo­ ertheless required. The extreme difficulty, or dation, whether it be in a hotel, with a family, even impossibility, of applying a provision of in a hostel, or wherever. The duration of the the Directive to a given type of package ser­ accommodation is of no importance in the vices — and it is a difficulty which is implic­ scheme of the Directive, which, in this regard, itly anticipated in the text of the Directive does no more than lay down a minimum limit: itself — is certainly not a circumstance which the whole service offered to the consumer can exclude those services outright from the must last not less than 24 hours or must at scope of the Directive, provided, of course, least include overnight accommodation. By that in every other respect the services in the same logic, the fact that the student is question meet the requirements laid down by received into the family with which he boards the provisions of the Directive. as if he were a child of the family, is also of no consequence.

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AFS INTERCULTURAL PROGRAMS FINLAND

Opinion

39. On the basis of the foregoing considerations, I therefore propose that the Court give the following answers to the questions referred to it by the Korkein hallinto- oikeus:

(1) Travel undertaken in a foreign country in the context of a student-exchange programme of between six months' and one year's duration, with a view to attending an educational establishment and acquiring familiarity with the people and culture of that country by staying with a local family, falls within the scope of Council Directive 90/314/EEC of 13 June 1990 on package travel, package holidays and package tours. On the other hand, the non-commercial nature of the business carried on by the organiser of the package and the fact that the beneficiary of the exchange programme is only required to pay part of the related costs are irrelevant in that regard.

(2) 2.1 A long-term stay, free of charge, with a family, even if the guest is treated almost like a child of the family, is to be regarded as 'accommodation' within the meaning of Article 2(1)(b).