Transaction Cancellation

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The Background to the Enactment of the Consumer Protection Law and Further Considerations Regarding Contract Cancellation

Prior to the Consumer Protection Law, consumer disputes were addressed under the Sale of Goods Law, 1968.

The Sale of Goods Law aimed to define the parameters of transactions between a “seller” and a “buyer,” contract cancellation, and compensation in cases of breach.

However, it lacked specific provisions for consumer transactions, which inherently require separate consideration.

The general Sale of Goods Law did not account for the unique characteristics of consumer transactions.

For example, transactions that do not occur between equal parties and suffer from power imbalances favoring the business operator and disadvantaging the consumer.

Furthermore, technological advancements and globalization have altered the nature of transactions (e.g., online orders), necessitating targeted solutions.

This need was recognized by the Knesset following considerable public outcry. Consumers voiced strong (and angry) complaints about businesses abusing their superior bargaining power.