(20) In this regard, Annex I to Directive 2005/29/EC should be amended in order to make it clear that practices where a trader provides information to a consumer in the form of search results in response to the consumer’s online search query without clearly disclosing any paid advertising or payment specifically for achieving higher ranking of products within the search results should be prohibited.
When a trader has directly or indirectly paid the provider of the online search functionality for a higher ranking of a product within the search results, the provider of the online search functionality should inform consumers of that fact in a concise, easily accessible and intelligible form.
Indirect payment could be in the form of the acceptance by a trader of additional obligations towards the provider of the online search functionality of any kind which have higher ranking as its specific effect.
The indirect payment could consist of increased commission per transaction as well as different compensation schemes that specifically lead to higher ranking.
Payments for general services, such as listing fees or membership subscriptions, which address a broad range of functionalities offered by the provider of the online search functionality to the trader, should not be considered to be a payment for specifically achieving higher ranking of products, provided that such payments are not dedicated to achieving higher ranking.
Online search functionality can be provided by different types of online trader, including intermediaries, such as online_marketplaces, search engines and comparison websites.
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(22) Traders enabling consumers to search for goods and services, such as travel, accommodation and leisure activities, offered by different traders or by consumers should inform consumers about the default main parameters determining the ranking of offers presented to the consumer as a result of the search query and their relative importance as opposed to other parameters.
That information should be succinct and made easily, prominently and directly available.
Parameters determining the ranking mean any general criteria, processes, specific signals incorporated into algorithms or other adjustment or demotion mechanisms used in connection with the ranking.
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(27) Providers of online_marketplaces should inform consumers whether the third party offering goods, services or digital_content is a trader or non-trader, based on the declaration made to them by the third party.
When the third party offering the goods, services or digital_content declares its status to be that of a non-trader, providers of online_marketplaces should provide a short statement to the effect that the consumer rights stemming from Union consumer protection law do not apply to the contract concluded.
Furthermore, consumers should be informed of how obligations related to the contract are shared between third parties offering the goods, services or digital_content and providers of online_marketplaces.
The information should be provided in a clear and comprehensible manner and not merely in the standard terms and conditions or similar contractual documents.
The information requirements for providers of online_marketplaces should be proportionate.
Those requirements need to strike a balance between a high level of consumer protection and the competitiveness of providers of online_marketplaces.
Providers of online_marketplaces should not be required to list specific consumer rights when informing consumers about their non-applicability.
This is without prejudice to the consumer information requirements provided for in Directive 2011/83/EU, and in particular in Article 6(1) thereof.
The information to be provided about the responsibility for ensuring consumer rights depends on the contractual arrangements between the providers of online_marketplaces and the relevant third-party traders.
The provider of the online_marketplace could indicate that a third-party trader is solely responsible for ensuring consumer rights, or describe its own specific responsibilities where that provider assumes responsibility for certain aspects of the contract, for example, delivery or the exercise of the right of withdrawal.
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(30) The definitions of digital_content and digital_services in Directive 2011/83/EU should be aligned to those in Directive (EU) 2019/770 of the European Parliament and of the Council (15).
Digital content covered by Directive (EU) 2019/770 covers a single act of supply, a series of individual acts of supply, or continuous supply over a period of time.
The element of continuous supply should not necessarily require a long-term supply.
Cases such as web-streaming of video clips should be considered continuous supply over a period of time, regardless of the actual duration of the audiovisual file.
It may therefore be difficult to distinguish between certain types of digital_content and digital_services, since both can involve continuous supply by the trader over the duration of the contract.
Examples of digital_services are video and audio sharing services and other file hosting, word processing or games offered in the cloud, cloud storage, webmail, social media and cloud applications.
The continuous involvement of the service provider justifies the application of the rules on the right of withdrawal provided for in Directive 2011/83/EU that effectively allow the consumer to test the service and decide, during the 14-day period from the conclusion of the contract, whether to keep it or not.
Many contracts for the supply of digital_content which is not supplied on a tangible medium are characterised by a single act of supply to the consumer of a specific piece or pieces of digital_content, such as specific music or video files.
Contracts for the supply of digital_content which is not supplied on a tangible medium remain subject to the exception from the right of withdrawal set out in point (m) of the first paragraph of Article 16 of Directive 2011/83/EU, which provides that the consumer loses the right of withdrawal when the performance of the contract is started, such as download or streaming of the content, subject to the consumer’s prior express consent to begin the performance during the right of withdrawal period and acknowledgement that he has thereby lost his right of withdrawal.
Where there is doubt as to whether the contract is a service_contract or a contract for the supply of digital_content which is not supplied on a tangible medium, the rules on right of withdrawal for services should apply.
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(31) Digital content and digital_services are often supplied online under contracts under which the consumer does not pay a price but provides personal_data to the trader.
Directive 2011/83/EU already applies to contracts for the supply of digital_content which is not supplied on a tangible medium (i.e.
supply of online digital_content) regardless of whether the consumer pays a price in money or provides personal_data.
However, that Directive only applies to service_contracts, including contracts for digital_services, under which the consumer pays or undertakes to pay a price.
Consequently, that Directive does not apply to contracts for digital_services under which the consumer provides personal_data to the trader without paying a price.
Given their similarities and the interchangeability of paid digital_services and digital_services provided in exchange for personal_data, they should be subject to the same rules under that Directive.
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(32) Consistency should be ensured between the scope of application of Directive 2011/83/EU and Directive (EU) 2019/770, which applies to contracts for the supply of digital_content or digital_services under which the consumer provides or undertakes to provide personal_data to the trader.
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(34) In order to ensure full alignment with Directive (EU) 2019/770, where digital_content and digital_services are not supplied in exchange for a price, Directive 2011/83/EU should also not apply to situations where the trader collects personal_data for the sole purpose of meeting legal requirements to which the trader is subject.
Such situations can include, for instance, cases where the registration of the consumer is required by applicable laws for security and identification purposes.
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(36) The notion of functionality should be understood to refer to the ways in which digital_content or a digital_service can be used.
For instance, the absence or presence of any technical restrictions such as protection via Digital Rights Management or region coding could have an impact on the ability of the digital_content or digital_service to perform all its functions having regard to its purpose.
The notion of interoperability relates to whether and to what extent digital_content or a digital_service is able to function with hardware or software that is different from those with which digital_content or digital_services of the same type are normally used.
Successful functioning could include, for instance, the ability of the digital_content or digital_service to exchange information with such other software or hardware and to use the information exchanged.
The notion of compatibility is defined in Directive (EU) 2019/770.
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(37) Article 7(3) and Article 8(8) of Directive 2011/83/EU require traders, for off-premises and distance contracts respectively, to obtain the consumer’s prior express consent to begin performance before the expiry of the right of withdrawal period.
Point (a) of Article 14(4) of that Directive provides for a contractual sanction when this requirement is not fulfilled by the trader, namely that the consumer does not have to pay for the services provided.
The requirement to obtain the consumer’s prior express consent is accordingly only relevant for services, including digital_services, which are provided against the payment of the price.
It is therefore necessary to amend Article 7(3) and Article 8(8) to the effect that the requirement for traders to obtain the consumer’s prior express consent only applies to service_contracts that place the consumer under an obligation to pay.
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(44) Article 14(4) of Directive 2011/83/EU stipulates the conditions under which, in the event of exercising the right of withdrawal, the consumer does not bear the cost for the performance of services, supply of public utilities and supply of digital_content which is not supplied on a tangible medium.
When any of those conditions is met, the consumer does not have to pay the price of the service, public utilities or digital_content received before the exercise of the right of withdrawal.
As regards digital_content, one of those non-cumulative conditions, namely under point (b)(iii) of Article 14(4), is a failure to provide the confirmation of the contract, which includes confirmation of the consumer’s prior express consent to begin the performance of the contract before the expiry of the right of withdrawal period and acknowledgement that the right of withdrawal is lost as a result.
However, that condition is not included among the conditions for the loss of the right of withdrawal in point (m) of the first paragraph of Article 16 of that Directive, creating uncertainty as regards the possibility for consumers to invoke point (b)(iii) of Article 14(4) when the other two conditions provided for in point (b) of Article 14(4) are met and, as a result, the right of withdrawal is lost in accordance with point (m) of the first paragraph of Article 16.
The condition provided for in point (b)(iii) of Article 14(4) should therefore be added to point (m) of the first paragraph of Article 16 to enable the consumer to exercise the right of withdrawal when that condition is not met and accordingly claim the rights provided for in Article 14(4).
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(54) While off-premises sales constitute a legitimate and well-established sales channel, like sales at a trader’s business premises and distance–selling, some particularly aggressive or misleading marketing or selling practices in the context of visits to a consumer’s home or excursions as referred to in point (8) of Article 2 of Directive 2011/83/EU can put consumers under pressure to make purchases of goods or services that they would not otherwise buy or purchases at excessive prices, often involving immediate payment.
Such practices often target elderly or other vulnerable consumers.
Some Member States consider those practices undesirable and deem it necessary to restrict certain forms and aspects of off-premises sales within the meaning of Directive 2011/83/EU, such as aggressive and misleading marketing or selling of a product in the context of unsolicited visits to a consumer’s home or excursions.
Where such restrictions are adopted on grounds other than consumer protection, such as public interest or the respect for consumers’ private life protected by Article 7 of the Charter, they fall outside the scope of Directive 2005/29/EC.
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