New bill introduces a mandatory withdrawal function and new obligations for providers of financial services and insurance products
Directive 2023/2673 (the "Directive") was adopted in response to the increasing use of digital platforms for the sale of financial services and insurance products to consumers. To ensure a harmonized approach to consumer protection in this sector, the directive amends the Consumer Rights Directive (Directive 2011/83/EU) and repeals the previous Directive on the distance marketing of consumer financial services (Directive 2002/65/EC).
On 28 March 2025, a new bill was proposed in the Danish Parliament to implement the Directive by amending the Danish Consumer Contracts Act and the Danish Insurance Contracts Act.
This update provides an overview of selected key elements of the proposed bill that will implement the Directive.
New withdrawal button
The bill introduces a new mandatory withdrawal function for all distance contracts concluded via online interfaces that are subject to the right of withdrawal. The obligation will not only apply to distance contracts for financial services and insurance products, but also to other distance contracts concluded online such as web shops, subscription services, etc.
The obligation is based on Article 11a in the Consumer Rights Directive and will be implemented in a new Section 20a in the Consumer Contracts Act. As insurance contracts are not covered by the Consumer Contracts Act, a reference to Section 20a will be inserted in Section 34j(1) of the Insurance Contracts Act.
Section 20a specifies that the online form must enable the consumer to provide or confirm their name, details identifying the contract from which they wish to withdraw, and details of their preferred method for receiving confirmation. The trader must then issue a receipt on a durable medium confirming the withdrawal without undue delay. The consumer is deemed to have exercised the right of withdrawal in time if the online form is submitted before the expiry of the withdrawal period. However, using the form is not mandatory, and consumers can also exercise their right of withdrawal by notifying the trader through other means.
The withdrawal button must be clearly visible and easily accessible, and it must remain continuously accessible throughout the entire withdrawal period. The function must be labelled with the words "Withdraw from contract here" (or in Danish: "Fortryd aftale") or another equally clear and unambiguous formulation.
Traders must also inform the consumers about the existence and location of the withdrawal button before entering into the contract. This obligation will be incorporated into Section 8(11) of the Consumer Contracts Act for non-financial contracts, Section 14(10) of the Consumer Contract Acts for financial services, and Section 34e(1)(6) of the Insurance Contracts Act for insurance contracts.
Aside from requiring that a withdrawal function is included on, for example, websites, this new information requirement is also expected to necessitate amendments to purchase flows and to existing terms and conditions.
New information requirements for financial services and insurance products
The bill introduces additional obligations regarding the information to be provided before entering into a distance contract for financial services or insurance products.
The bill proposes several additions to the lists of pre-contractual information obligations, including information regarding:
- the consequences of late or missed payments, if any,
- whether the price has been personalized through automated decision-making, if relevant, and
- any environmental or social objectives if such considerations are integrated into the investment strategy.
If the list of mandatory pre-contractual information is provided less than 24 hours before the consumer is bound by the contract, the provider must send a reminder within one to seven days after the conclusion of the contract, clearly outlining the right of withdrawal and how to exercise it.
Further, providers of financial services and insurance products must also give clear and comprehensive explanations of the proposed agreement, enabling consumers to assess whether the product or service is suitable for their needs and financial situation. This must be provided free of charge prior to the conclusion of the contract, and it must include all mandatory information, the key features of the service, and any potential consequences for the consumer. In cases where such explanations are provided through online tools - such as chatbots, robo-advisors or interactive online modules - the consumers have a right to receive personal assistance upon request before entering into the contract.
The information requirements are based on the new Articles 16a and 16d in the Consumer Rights Directive. They will be implemented in Sections 14-14b of the Consumer Contracts Act and Sections 34e-f of the Insurance Contracts Act.
Prohibition against dark patterns for financial services and insurance products
To enhance consumer protection on online interfaces, the Directive introduces a new Article 16e to the Consumer Rights Directive specifically targeting the use of misleading or manipulative interface designs in distance contracts for financial services and insurance products. The ban will be implemented in Section 4(3) of the Consumer Contracts Act and Section 34b(3) of the Insurance Contracts Act.
According to the ban, traders must not design their online interfaces in a way that distorts or impairs the ability of consumers to make free, informed, and autonomous decisions when concluding financial contracts or insurance contracts at a distance. Examples include making it harder to cancel a contract than to conclude it, hiding the withdrawal button, or using coercive tactics such as artificial countdowns.
Based on the preparatory works, the use of dark patterns will also be contrary to Sections 3-6 and 8 of the Marketing Practices Act.
Next steps
The bill is expected to be processed in the Danish Parliament during 2025 with the first reading taking place on 11 April, and the new rules are set to enter into force on 19 June 2026.
Do you want to know more?
If you have any questions regarding the new bill, please contact Plesner's Marketing Law and Consumer Law team.