keyboard_tab REGIS - Reg. Intermediation Services 2019/1150 EN

(2) Online intermediation services can be crucial for the commercial success of undertakings who use such services to reach consumers.

  To fully exploit the benefits of the online platform economy, it is therefore important that undertakings can trust online_intermediation_services with which they enter into commercial relationships.

  This is important mainly because the growing intermediation of transactions through online_intermediation_services, fuelled by strong data-driven indirect network effects, leads to an increased dependence of such business_users, particularly micro, small and medium-sized enterprises (SMEs), on those services in order for them to reach consumers.

  Given that increasing dependence, the providers of those services often have superior bargaining power, which enables them to, in effect, behave unilaterally in a way that can be unfair and that can be harmful to the legitimate interests of their businesses users and, indirectly, also of consumers in the Union.

  For instance, they might unilaterally impose on business_users practices which grossly deviate from good commercial conduct, or are contrary to good faith and fair dealing.

  This regulation addresses such potential frictions in the online platform economy.

(7) A targeted set of mandatory rules should be established at Union level to ensure a fair, predictable, sustainable and trusted online business environment within the internal market.

  In particular, business_users of online_intermediation_services should be afforded appropriate transparency, as well as effective redress possibilities, throughout the Union in order to facilitate cross-border business within the Union and thereby improve the proper functioning of the internal market and to address possible emerging fragmentation in the specific areas covered by this regulation.

(8) Those rules should also provide for appropriate incentives to promote fairness and transparency, especially as regards the ranking of corporate_website_users in the search results generated by online_search_engines.

  At the same time, those rules should recognise and safeguard the important innovation potential of the wider online platform economy and allow for healthy competition leading to increased consumer choice.

  It is appropriate to clarify that this regulation should not affect national civil law, in particular contract law, such as the rules on the validity, formation, effects or termination of a contract, in so far as the national civil law rules are in conformity with Union law and to the extent that the relevant aspects are not covered by this regulation.

  Member States should remain free to apply national laws which prohibit or sanction unilateral conduct or unfair commercial practices to the extent that the relevant aspects are not covered by this regulation.

(9) Since online_intermediation_services and online_search_engines typically have a global dimension, this regulation should apply to providers of those services regardless of whether they are established in a Member State or outside the Union, provided that two cumulative conditions are met.

  Firstly, the business_users or corporate_website_users should be established in the Union.

  Secondly, the business_users or corporate_website_users should, through the provision of those services, offer their goods or services to consumers located in the Union at least for part of the transaction.

  In order to determine whether business_users or corporate_website_users are offering goods or services to consumers located in the Union, it is necessary to ascertain whether it is apparent that the business_users or corporate_website_users direct their activities to consumers located in one or more Member States.

  This criterion should be interpreted in accordance with the relevant case law of the Court of Justice of the European Union on point (c) of Article 17(1) of regulation (EU) No 1215/2012 of the European Parliament and of the Council (3) and point (b) of Article 6(1) of regulation (EC) No 593/2008 of the European Parliament and of the Council (4).

  Such consumers should be located in the Union, but do not need to have their place of residence in the Union nor have the nationality of any Member State.

  Accordingly, this regulation should not apply where business_users or corporate websites users are not established in the Union or where they are established in the Union but where they use online_intermediation_services or online_search_engines to offer goods or services exclusively to consumers located outside the Union or to persons who are not consumers.

  Furthermore, this regulation should apply irrespective of the law otherwise applicable to a contract.

(10) A wide variety of business-to-consumer relations are intermediated online by providers operating multi-sided services that are essentially based on the same ecosystem-building business model.

  In order to capture the relevant services, online_intermediation_services should be defined in a precise and technologically-neutral manner.

  In particular, the services should consist of information society services, which are characterised by the fact that they aim to facilitate the initiating of direct transactions between business_users and consumers, irrespective of whether the transactions are ultimately concluded online, on the online portal of the provider of online_intermediation_services in question or that of the business_user, offline or in fact not at all, meaning that there should be no requirement for any contractual relationship between the business_users and consumers as a precondition for online_intermediation_services falling within the scope of this regulation.

  The mere inclusion of a service of a marginal character only should not be seen as making the aim of a website or service the facilitation of transactions within the meaning of online_intermediation_services.

  In addition, the services should be provided on the basis of contractual relationships between the providers and business_users which offer goods or services to consumers.

  Such a contractual relationship should be deemed to exist where both parties concerned express their intention to be bound in an unequivocal manner on a durable_medium, without an express written agreement necessarily being required.

(11) Examples of online_intermediation_services covered by this regulation should consequently include online e-commerce market places, including collaborative ones on which business_users are active, online software applications services, such as application stores, and online social media services, irrespective of the technology used to provide such services.

  In this sense, online_intermediation_services could also be provided by means of voice assistant technology.

  It should also not be relevant whether those transactions between business_users and consumers involve any monetary payment or whether they are concluded in part offline.

  However, this regulation should not apply to peer-to-peer online_intermediation_services without the presence of business_users, pure business-to-business online_intermediation_services which are not offered to consumers, online advertising tools and online advertising exchanges which are not provided with the aim of facilitating the initiation of direct transactions and which do not involve a contractual relationship with consumers.

  For the same reason, search engine optimisation software services as well as services which revolve around advertising-blocking software should not be covered by this regulation.

  Technological functionalities and interfaces that merely connect hardware and applications should not be covered by this regulation, as they normally do not fulfil the requirements for online_intermediation_services.

  However, such functionalities or interfaces can be directly connected or ancillary to certain online_intermediation_services and where this is the case, the relevant providers of online_intermediation_services should be subject to transparency requirements related to differentiated treatment based on these functionalities and interfaces.

  This regulation should also not apply to online payment services, since they do not themselves meet the applicable requirements but are rather inherently auxiliary to the transaction for the supply of goods and services to the consumers concerned.

(12) In line with the relevant case-law of the Court of Justice of the European Union and in the light of the fact that the dependent position of business_users has been observed principally in respect of online_intermediation_services that serve as a gateway to consumers in the form of natural persons, the notion of consumer used to delineate the scope of this regulation should be understood as referring solely to natural persons, where they are acting for purposes which are outside their trade, business, craft or profession.

(13) Considering the quick pace of innovation, the definition of online_search_engine used in this regulation should be technology-neutral.

  In particular, the definition should be understood to also encompass voice requests.

(14) Providers of online_intermediation_services tend to use pre-formulated terms_and_conditions and in order to effectively protect business_users where needed, this regulation should apply where the terms_and_conditions of a contractual relationship, regardless of their name or form, are unilaterally determined by the provider of online_intermediation_services.

  Whether the terms_and_conditions were unilaterally determined should be evaluated case by case on the basis of an overall assessment.

  For that overall assessment, the relative size of the parties concerned, the fact that a negotiation took place, or that certain provisions thereof might have been subject to such a negotiation and determined together by the relevant provider and business_user should not, in itself, be decisive.

  In addition, the obligation for providers of online_intermediation_services to make their terms_and_conditions easily available to business_users, including in the pre-contractual stage of their commercial relationship, means that business_users will not be deprived of the transparency resulting from this regulation as a result of them being in any way able to successfully negotiate.

(23) The termination of the whole of the online_intermediation_services and the related deletion of data provided for the use of, or generated through, the provision of online_intermediation_services represent a loss of essential information which could have a significant impact on business_users and could also impair their ability to properly exercise other rights granted to them by this regulation.

  Therefore, the provider of online_intermediation_services should provide the business_user concerned with a statement of reasons on a durable_medium, at least 30 days before the termination of the provision of the whole of its online_intermediation_services enters into effect.

  However, in cases where a legal or regulatory obligation requires a provider of online_intermediation_services to terminate the provision of the whole of its online_intermediation_services to a given business_user, this notice period should not apply.

  Equally, the notice period of 30 days should not apply where a provider of online_intermediation_services invokes rights of termination under national law in compliance with Union law which allow immediate termination where, taking into account all the circumstances of the specific case and weighing the interests of both parties, it cannot reasonably be expected to continue the contractual relationship until the agreed end or until the expiry of a notice period.

  Finally, the notice period of 30 days should not apply where a provider of online_intermediation_services can demonstrate a repeated infringement of terms_and_conditions.

  The various exceptions to the 30-day notice period can in particular arise in connection with illicit or inappropriate content, the safety of a good or service, counterfeiting, fraud, malware, spam, data breaches, other cybersecurity risks or suitability of the good or service to minors.

  In order to ensure proportionality, providers of online_intermediation_services should, where reasonable and technically feasible, delist only individual goods or services of a business_user.

  Termination of the whole of the online_intermediation_services constitutes the most severe measure.

(27) Providers of online_intermediation_services or of online_search_engines should not be required to disclose the detailed functioning of their ranking mechanisms, including algorithms, under this regulation.

  Their ability to act against bad faith manipulation of ranking by third parties, including in the interest of consumers, should equally not be impaired.

  A general description of the main ranking parameters should safeguard those interests, while providing business_users and corporate_website_users with an adequate understanding of the functioning of ranking in the context of their use of specific online_intermediation_services or online_search_engines.

  To ensure that the objective of this regulation is achieved, consideration of the commercial interests of providers of online_intermediation_services or online_search_engines should, therefore, never lead to a refusal to disclose the main parameters determining ranking.

  In this regard, whilst this regulation is without prejudice to Directive (EU) 2016/943 of the European Parliament and of the Council (5), the description given should at least be based on actual data on the relevance of the ranking parameters used.

(28) The Commission should develop guidelines to assist providers of online_intermediation_services and providers of online_search_engines in applying the ranking transparency requirements laid down by this regulation.

  This effort should help to optimise the manner in which the main parameters determining ranking are identified and presented to business_users and corporate_website_users.

(32) Specific contractual terms should be addressed in this regulation, in particular in situations of imbalances in bargaining power, in order to ensure that contractual relations are conducted in good faith and on the basis of fair dealing.

  Predictability and transparency require that business_users are given a real opportunity to become acquainted with changes to terms_and_conditions, which should therefore not be imposed with retroactive effect unless they are based on a legal or regulatory obligation or are beneficial to those business_users.

  Business users should in addition be offered clarity as to the conditions under which their contractual relationship with providers of online_intermediation_services can be terminated.

  Providers of online_intermediation_services should ensure that the conditions for termination are always proportionate and can be exercised without undue difficulty.

  Finally, business_users should be fully informed of any access that providers of online_intermediation_services maintain, after the expiry of the contract, to the information that business_users provide or generate in the context of their use of online_intermediation_services.

(35) Those requirements should not be understood as any obligation for providers of online_intermediation_services to either disseminate or not to disseminate personal or non-personal data to their business_users.

  However, transparency measures could contribute to increased data sharing and enhance, as a key source of innovation and growth, the aims to create a common European data space.

  Processing of personal data should comply with the Union legal framework on the protection of natural persons with regard to the processing of personal data, and on respect for private life and the protection of personal data in electronic communications, in particular regulation (EU) 2016/679 (6), Directive (EU) 2016/680 (7) and Directive 2002/58/EC (8) of the European Parliament and of the Council.

(38) The requirements of this regulation regarding the internal complaint-handling systems aim to allow providers of online_intermediation_services a reasonable degree of flexibility when operating those systems and addressing individual complaints, so as to minimise any administrative burden.

  In addition, the internal complaint-handling systems should allow providers of online_intermediation_services to address, where necessary, in a proportionate manner any use in bad faith which certain business_users might seek to make of those systems.

  In light of the costs of setting up and operating such systems, it is appropriate to exempt from those obligations any providers of online_intermediation_services which constitute small enterprises, in line with the relevant provisions of Commission Recommendation 2003/361/EC (9).

  The consolidation rules laid down in that Recommendation ensure that any circumvention is prevented.

  That exemption should not affect the right of such enterprises to set up, on a voluntary basis, an internal complaint-handling system that complies with the criteria set out in this regulation.

(39) The use of the word ‘internal’ should not be understood as preventing the delegation of an internal complaint-handling system to an external service provider or other corporate structure, as long as such a provider or other corporate structure has full authority and the ability to ensure compliance of the internal complaint-handling system with the requirements in this regulation.

(40) Mediation can offer providers of online_intermediation_services and their business_users a means to resolve disputes in a satisfactory manner, without having to use judicial proceedings which can be lengthy and costly.

  Therefore, providers of online_intermediation_services should facilitate mediation by, in particular, identifying at least two public or private mediators with which they are willing to engage.

  The aim of requiring the identification of a minimum number of mediators is to safeguard the mediators’ neutrality.

  Mediators which provide their services from a location outside the Union should only be identified where it is guaranteed that the use of those services does not in any way deprive the business_users concerned of any legal protection offered to them under Union law or the law of the Member States, including the requirements of this regulation and the applicable law regarding protection of personal data and trade secrets.

  In order to be accessible, fair, and as swift, efficient and effective as possible, those mediators should meet certain set criteria.

  Nonetheless, providers of online_intermediation_services and their business_users should remain free to jointly identify any mediator of their choice after a dispute has arisen between them.

  In line with Directive 2008/52/EC of the European Parliament and of the Council (10), the mediation provided for in this regulation should be a voluntary process in the sense that the parties are themselves in charge of the process and can start and terminate it at any time.

  Notwithstanding its voluntary nature, providers of online_intermediation_services should examine in good faith requests to engage in the mediation provided for in this regulation.

(41) Providers of online_intermediation_services should bear a reasonable proportion of the total costs of the mediation, taking into account all relevant elements of the case at hand.

  To that end, the mediator should suggest which proportion is reasonable in the individual case.

  In light of the costs and of the administrative burden associated with the necessity to identify mediators in terms_and_conditions, it is appropriate to exempt from that obligation any providers of online_intermediation_services which are small enterprises, in line with the relevant provisions of Recommendation 2003/361/EC.

  The consolidation rules laid down in that Recommendation ensure that any circumvention of that obligation is prevented.

  Nevertheless, this should not affect the right of such enterprises to identify mediators in their terms_and_conditions that comply with the criteria set out in this regulation.

(42) Since the providers of online_intermediation_services should always be required to identify mediators with which they are willing to engage, and should be obliged to engage in good faith throughout any mediation attempts conducted pursuant to this regulation, these obligations should be established in a way that prevents abuse of the mediation system by business_users.

  Business users should also be obliged to engage in mediation in good faith.

  Providers of online_intermediation_services should not be obliged to engage in mediation where a business_user brings proceedings on a subject in relation to which that business_user has previously brought proceedings seeking mediation and the mediator has determined in that case that the business_user has not acted in good faith.

  Providers of online_intermediation_services should also not be obliged to engage in mediation with business_users who have made repeated unsuccessful mediation attempts.

  These exceptional situations should not limit the business_user’s ability to submit a case to mediation where, as determined by the mediator, the subject matter of the mediation is not related to the previous cases.

(44) Various factors, such as limited financial means, a fear of retaliation and exclusive choice of law and forum provisions in terms_and_conditions, can limit the effectiveness of existing judicial redress possibilities, particularly those which require business_users or corporate_website_users to act individually and identifiably.

  To ensure the effective application of this regulation, organisations, associations representing business_users or corporate_website_users, as well as certain public bodies set up in Member States, should be granted the possibility to take action before national courts in accordance with national law, including national procedural requirements.

  Such action before national courts should aim to stop or prohibit infringements of the rules set out in this regulation and to prevent future damage that could undermine sustainable business relationships in the online platform economy.

  In order to ensure that such organisations or associations exercise that right effectively and in an appropriate manner, they should meet certain criteria.

  In particular, they must be properly established according to the law of a Member State, be of a non-profit making character and pursue their objectives on a sustained basis.

  Those requirements should prevent any ad hoc establishment of organisations or associations for the purpose of a specific action or specific actions, or for the sake of making profits.

  Furthermore, it should be ensured that there is no undue influence by any third party providers of financing on decision-making by those organisations or associations.

(45) The identity of organisations, associations and public bodies which, in the view of the Member States, should be qualified to bring an action under this regulation, should be communicated to the Commission.

  In the course of such a communication, Member States should make specific reference to the relevant national provisions according to which the organisation, association or public body was established and, where appropriate, refer to the relevant public register in which the organisation or association is registered.

  This additional option of a designation by Member States should provide for a certain level of legal certainty and predictability that business_users and corporate_website_users can rely on.

  At the same time, it aims at making judicial procedures more efficient and shorter, which seems appropriate in this context.

  The Commission should ensure the publication of a list of those organisations, associations and public bodies in the Official Journal of the European Union.

  Inclusion on that list should serve as refutable proof of the legal capacity of the organisation, association or public body bringing the action.

  Where there are any concerns regarding a designation, the Member State which designated an organisation, association or public body should investigate those concerns.

  Organisations, associations and public bodies that are not designated by a Member State should have the possibility to bring an action before national courts subject to examination of legal capacity according to the criteria set out in this regulation.

(46) Member States should be required to ensure adequate and effective enforcement of this regulation.

  Different enforcement systems already exist in Member States, and they should not be obliged to set up new national enforcement bodies.

  Member States should have the option to entrust existing authorities, including courts, with the enforcement of this regulation.

  This regulation should not oblige Member States to provide for ex officio enforcement or to impose fines.

(47) The Commission should continuously monitor the application of this regulation in close cooperation with the Member States.

  In this context, the Commission should aim to establish a broad information exchange network by leveraging relevant expert bodies, centres of excellence as well as the Observatory on the Online Platform Economy.

  Member States should, upon request, provide any relevant information they have in this context to the Commission.

  Finally, this exercise should benefit from the overall enhanced transparency in commercial relations between business_users and providers of online_intermediation_services and between corporate_website_users and online_search_engines that this regulation aims to achieve.

  In order to carry out its monitoring and review duties effectively under this regulation, the Commission should endeavour to gather information from providers of online_intermediation_services.

  Providers of online_intermediation_services should cooperate in good faith in facilitating the gathering of such data, where applicable.

(48) Codes of conduct, drawn up either by the service providers concerned or by organisations or associations representing them, can contribute to the proper application of this regulation and should therefore be encouraged.

  When drawing up such codes of conduct, in consultation with all relevant stakeholders, account should be taken of the specific features of the sectors concerned as well as of the specific characteristics of SMEs.

  Such codes of conduct should be worded in an objective and non-discriminatory way.

(49) The Commission should periodically evaluate this regulation and closely monitor its effects on the online platform economy, in particular with a view to determining the need for amendments in light of relevant technological or commercial developments.

  This evaluation should include the effects on business_users which might result from the general use of exclusive choice of law and forum provisions in terms_and_conditions which are unilaterally determined by the provider of online_intermediation_services.

  In order to obtain a broad view of developments in the sector, the evaluation should take into account the experiences of Member States and relevant stakeholders.

  The group of experts for the Observatory on the Online Platform Economy established in accordance with the Commission Decision C(2018)2393 has a key role in informing the evaluation of this regulation by the Commission.

  The Commission should therefore duly consider the opinions and reports presented to it by the group.

  Following the evaluation, the Commission should take appropriate measures.

  Further measures, including of a legislative nature, may be appropriate if and where the provisions established in this regulation prove to be insufficient to adequately address imbalances and unfair commercial practices persisting in the sector.

(50) When providing the information required under this regulation, account should be taken as much as possible of the particular needs of persons with disabilities, in line with the objectives of the United Nations Convention on the Rights of Persons with Disabilities (11).

(51) Since the objective of this regulation, namely to ensure a fair, predictable, sustainable and trusted online business environment within the internal market, cannot be sufficiently achieved by the Member States, but can rather, by reason of its scale and effects, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union.

  In accordance with the principle of proportionality, as set out in that Article, this regulation does not go beyond what is necessary in order to achieve that objective.

(52) This regulation seeks to ensure full respect for the right to an effective remedy and to a fair trial as laid down in Article 47 of the Charter of Fundamental Rights of the European Union and promote the application of the freedom to conduct a business as laid down in Article 16 of the Charter,