"Cancel Contract" button for financial services

New European Regulation and Who It Affects

The European Union has focused on an area where withdrawal is often most complicated – financial services. The result is Directive (EU) 2023/2673, which amends the Consumer Rights Directive. The Czech Republic is transposing this regulation into its Civil Code and Consumer Protection Act. As of 19 June 2026, the provisions introducing a "withdrawal function," or a function for withdrawing from a contract, will take effect.

Who is affected by this obligation?

Unlike the general sale of goods, where an easy withdrawal is recommended but a specific button in this form is not strictly mandated, this directive targets distance contracts for financial services.

This affects you if you offer the following online:

• Consumer loans (including BNPL-type deferred payments, if they are in the form of a loan).

• Insurance (e.g., travel insurance, electronics insurance, extended warranties in the form of an insurance policy).

• Investment products and pension savings.

For e-shops, this is crucial when they offer purchase financing or product insurance in the shopping cart. If the customer concludes a financial service contract directly on your website, you must ensure this button is present. For regulated financial products, it is also advisable to verify whether your distribution model requires authorisation or registration with the supervisory authority – see CNB licences & investments.

What exactly does the new obligation require

The function (button) must meet the strict requirements of the Directive, as transposed into Czech law:

Visibility and accessibility. The button must be easily accessible in the user interface throughout the withdrawal period (usually 14 days; 30 days for life insurance and pension products). The customer should be able to find it without unnecessary searching, for example, in the "My Products" section or in the contract details. It must not be hidden.

Clear labelling. The text on the button must clearly communicate its function. The law prefers the wording "Withdraw from contract" or a similarly clear phrase.

Simple post-click process. After clicking, the customer must be able to fill out a withdrawal declaration. It is not permissible to require a login unless it is necessary for identification, and the form should be pre-filled if the customer is identified.

Confirmation without undue delay. The trader must, without undue delay, send the customer a confirmation of receipt of the withdrawal on a durable medium (e.g., email), including the date and time. In practice, it is worthwhile to have the technical and contractual aspects of who generates the confirmation and how it is archived clearly defined, especially if external suppliers handle part of the process – for more on this, see External Contractors versus Employees: How to Correctly Set Up Contractual Relationships and Eliminate the Tax Risks of Hidden Employment.

Prohibition of Dark Patterns. In accordance with the Digital Services Act (DSA) and the amendment to the Consumer Protection Act, it is forbidden to use manipulative design that would complicate the process. When setting up the user interface and withdrawal flows, it is often necessary to also address the related processing of personal data and logging of user steps, which typically falls under the scope of GDPR.

What are the penalties for non-compliance

Supervision of compliance with obligations in the financial services sector is carried out by the Czech National Bank (CNB) and, in some aspects of consumer protection, by the Czech Trade Inspection Authority (CTIA). If the obligation also applies to you through digital channels, it may be useful to align the implementation with the rules for online services and data processing, as summarised in the article SaaS Platform in the EU: Legal Treatment of GTC, GDPR, and Licensing Agreements for AI Outputs.

A breach of obligations related to the right of withdrawal and information duties is punishable by a fine of up to CZK 5,000,000 under the Consumer Protection Act.

In addition to an administrative fine, there is a risk of the invalidity of actions or an extension of the withdrawal period by one year if the consumer was not properly informed. There is also a significant reputational risk and the possibility of losing a licence for regulated entities.

How to practically prepare for June 2026

1. Product Audit (March–April 2026). Determine whether you offer products that fall under the definition of distance financial services (insurance for products, loans, deferred payments arranged directly by you).

2. Technical Implementation (March–June 2026). If you are a service provider, you must develop an interface with the button. If you are an e-shop acting as an intermediary for services, contact your partners and request information on implementing their withdrawal solution into your user interface.

3. Legal Adjustments (May 2026). Update your General Terms and Conditions (GTC) and pre-contractual information, which must explicitly describe the existence and function of the withdrawal button. The lawyers at our Prague-based ARROWS law firm can prepare the wording in accordance with the new directive.

4. Process Testing. Verify that pressing the button terminates the correct contract. For example, only the insurance contract should be terminated, not the purchase contract for the goods, unless the customer wishes to do so.

Manipulative Design and How to Avoid It

Although the new obligation primarily concerns financial services, the prohibition of dark patterns (manipulative design) applies to all e-shops under the Digital Services Act (DSA).

What is prohibited:

• The withdrawal button is greyed out or less visible compared to the "Keep" button.

• The need to click through a series of "Are you sure?" questions.

• Emotional blackmail or false urgency.

Regulators will assess whether the withdrawal process is as easy as the purchase process.

Exceptions – When Withdrawal Is Not Possible

Even for distance financial services, the right of withdrawal is not absolute. According to the Czech Civil Code and the Directive, it is not possible to withdraw from, for example:

• Services whose price depends on fluctuations in the financial market which the trader cannot control.

• Travel or baggage insurance if it was concluded for a period of less than 1 month.

• Contracts that were fully performed at the consumer's express request before the expiry of the withdrawal period.

In these cases, the button does not have to be active or may lead to information stating that withdrawal is not possible.

Final Summary

The new obligation to introduce a contract withdrawal button under Directive (EU) 2023/2673 is targeted at the distance financial services sector. From 19 June 2026, banks, insurance companies, non-bank providers, and e-shops that intermediate these services must offer a transparent digital tool for contract termination.

Although this specific obligation does not yet apply in this strict form to the sale of ordinary goods, the trend in consumer protection is clearly moving towards making withdrawal as simple as possible in all cases. We recommend that everyone draw inspiration from this and simplify their processes.

Do you need help with a legal review of your financial services sales or setting up your e-shop in compliance with the DSA? Contact the lawyers at ARROWS law firm. Contact us at consultation@arws.cz.