Online coaching sessions on topics such as „online business“, „trading“, „property“, „personal development“ and „financial freedom“ have been booming for several years now. The advertising promises sound tempting to many people: location-independent income, scaling your own business, six-figure sales within a few months.
However, many people only realise this after signing a contract: Behind high-priced programmes there are often only very general motivational videos, recorded standard modules and chat groups without any substantial added value. The costs are often between 3,000 and 20,000 euros.
In many cases, such contracts are legally contestable.
How online coaching contracts are typically concluded
Entry is usually made via social media advertising. After leaving contact details, an invitation to a free „strategy meeting“ or „orientation call“ often follows very quickly.
In these discussions:
- made great promises of success,
- Time pressure built up („only available today“),
- Doubt psychologically reinterpreted („You don't leave your comfort zone“),
- financial possibilities of the interested party.
It is not uncommon for the contract to be finalised during the video call. The prospective customer receives a link to a registration form and is asked to sign immediately or tick a checkbox. Information about legal details - in particular the right of cancellation - is often superficial or inaccurate.
Instalment payment models over 12 or 24 months also give the impression of a subscription that can be cancelled monthly. In reality, however, it is often a fixed overall contract with a full payment obligation.
Is it really a „B2B business“?
Many providers argue after a declared cancellation that it is a contract between entrepreneurs. Therefore, there is no right of cancellation.
This argument does not apply in many cases.
Whether a contract qualifies as a consumer or entrepreneurial transaction is not determined by mere claims in the contract, but by the actual circumstances. If a private individual without an existing business activity books coaching in order to „set up their own business“, this still regularly constitutes a consumer transaction, even if the coaching provider claims otherwise.
Even contracts in preparation for future self-employment are generally subject to consumer protection under Austrian law.
Right of cancellation for online coaching
Contracts concluded online are generally subject to the 14-day right of cancellation.
Providers often try to portray coaching as „digital content“ for which the right of cancellation expires immediately. This is often legally incorrect.
Online coaching sessions are regularly digital services to qualify because they:
- over a longer period of time,
- contain interactive elements (Q&A, feedback, group calls),
- provide for supervision or accompaniment.
In the case of services, the right of cancellation does not expire automatically when access is provided. Premature cancellation requires, among other things, that the service has been provided in full and the consumer has expressly consented to this.
If you have not been properly informed about the right of cancellation, the deadline may be considerably extended. In addition, there may not even be an obligation to pay for services already consumed.
„Reduction by more than half“ (laesio enormis)
Another starting point is Section 934 ABGB. According to this, a contract can be contested if there is a conspicuous imbalance between performance and consideration.
If, for example, a coaching session costs 8,000 euros, but the objective market value of the content provided is significantly lower, the contract can be contested in court.
Generally accessible motivational videos or generic business guides without individual substance do not regularly justify four- or five-figure sums.
German law and the Distance Learning Protection Act
If the contract concluded by an Austrian is subject to German law (however, this requires that the transaction is actually a B2B transaction), the Distance Learning Protection Act (FernUSG) is also relevant.
Many online coaching courses fulfil the criteria of distance learning because:
- Teachers and learners are physically separated,
- systematically impart knowledge,
- a form of learning assessment is provided.
Distance learning courses require a state licence. If this is missing, the contract may be null and void.
Especially in the case of platform models with standardised modules and accompanying calls, this approval is often not obtained - with considerable legal consequences.
Transfer of registered office abroad
Recently, some providers have indicated company headquarters in third countries (e.g. UAE). Whether this information on the registered office corresponds to the actual economic reality must be checked on a case-by-case basis. For consumers with their habitual residence in Austria or Germany, domestic law may nevertheless be applicable.
Do further instalments have to be paid?
In practice, it is often not a question of amounts already paid, but of outstanding receivables.
If:
- an effective cancellation has been declared,
- the contract is voidable due to laesio enormis,
- or if German law is applied, there is a violation of the FernUSG,
there may be no obligation to make further payments.
Collection letters or threats of legal action do not automatically mean that the claim is justified.
Conclusion
Many high-priced online coaching contracts are legally vulnerable.
Depending on the circumstances, the following may be considered:
- Cancellation due to distance selling,
- Cancellation due to conspicuous disproportion,
- Nullity under German distance learning law,
- or other objections under civil law.
Each case must be examined individually - generalised statements by providers are often legally untenable.
Have you received a request for payment or a debt collection threat?
If you are confronted with high claims from an online coaching contract or are unsure whether you have to pay further instalments, I recommend a quick legal check.
I will be happy to analyse your contract, the contractual circumstances and the prospects of success of a revocation or rescission and represent you vis-à-vis the provider or debt collection agency, both in and out of court.
Contact us Please contact me for an initial assessment.
Despite the utmost care, no liability is assumed for the content of this article. This article is for information purposes only and does not constitute binding legal advice.