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.

(4) Similarly, online_search_engines can be important sources of Internet traffic for undertakings which offer goods or services to consumers through websites and can therefore significantly affect the commercial success of such corporate_website_users offering their goods or services online in the internal market.

  In this regard, the ranking of websites by providers of online_search_engines, including of those websites through which corporate_website_users offer their goods and services to consumers, has an important impact on consumer choice and the commercial success of those corporate_website_users.

  Even in the absence of a contractual relationship with corporate_website_users, providers of online_search_engines can therefore, in effect, behave unilaterally in a way that can be unfair and that can be harmful to the legitimate interests of corporate_website_users and, indirectly, also of consumers in the Union.

(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.

(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.

(17) The ownership and control of intellectual property rights online can have significant economic importance for both the providers of online_intermediation_services and their business_users.

  To ensure clarity and transparency for business_users and for their better understanding, providers of online_intermediation_services should within their terms_and_conditions include general, or more detailed, information if they so wish, regarding the overall effects, if any, of those terms_and_conditions on the ownership and control of intellectual property rights of the business_user.

  such information could, inter alia, include information such as the general usage of logos, trademarks or brand names.

(20) In order to protect business_users and to provide legal certainty for both sides, non-compliant terms_and_conditions should be null and void, that is, deemed to have never existed, with effects erga omnes and ex tunc.

  This should however only concern the specific provisions of the terms_and_conditions which are not compliant.

  The remaining provisions should remain valid and enforceable, in as far as they can be severed from the non-compliant provisions.

  Sudden changes to existing terms_and_conditions may significantly disrupt business_users’ operations.

  In order to limit such negative effects on business_users, and to discourage such behaviour, changes made in contravention of the obligation to provide a set notice period should therefore be null and void, that is, deemed to have never existed, with effects erga omnes and ex tunc.

(22) A provider of online_intermediation_services can have legitimate reasons to decide to restrict, suspend or terminate the provision of its services to a given business_user, including by delisting individual goods or services of a given business_user or effectively removing search results.

  Short of being suspended, providers of online_intermediation_services can also restrict individual listings of business_users; for example, through their demotion or by negatively affecting a business_user’s appearance (‘dimming’) which can include lowering its ranking.

  However, given that such decisions can significantly affect the interests of the business_user concerned, they should be provided, prior to or at the time of the restriction or suspension taking effect, with a statement of reasons for that decision on a durable_medium.

  To minimise the negative impact of such decisions on business_users, providers of online_intermediation_services should also allow an opportunity to clarify the facts that led to that decision in the framework of the internal complaint-handling process, which will help the business_user, where this is possible, to re-establish compliance.

  In addition, where the provider of online_intermediation_services revokes the decision to restrict, suspend or terminate, for example because the decision was made in error or the infringement of terms_and_conditions that led to this decision was not committed in bad faith and has been remedied in a satisfactory manner, the provider should reinstate the business_user concerned without undue delay, including providing the business_user with any access to personal or other data, or both, available prior to the decision.

(25) The description of the main parameters determining ranking should also include an explanation of any possibility for business_users to actively influence ranking against remuneration, as well as an explanation of the relative effects thereof.

  Remuneration could, in this respect, refer to payments made with the main or sole aim to improve ranking, as well as indirect remuneration in the form of the acceptance by a business_user of additional obligations of any kind which may have this as its practical effect, such as the use of services that are ancillary or of any premium features.

  The content of the description, including the number and type of main parameters, can accordingly vary strongly depending on the specific online_intermediation_services, but should provide business_users with an adequate understanding of how the ranking mechanism takes account of the characteristics of the actual goods or services offered by the business_user, and their relevance to the consumers of the specific online_intermediation_services.

  The indicators used for measuring the quality of goods or services of business_users, the use of editors and their ability to influence the ranking of those goods or services, the amplitude of the impact of remuneration on ranking as well as elements that do not or only remotely relate to the good or service itself, such as presentational features of the online offer, could be examples of main parameters that, when included in a general description of the ranking mechanism in plain and intelligible language, should assist business_users in obtaining the required adequate understanding of its functioning.

(26) Similarly, the ranking of websites by the providers of online_search_engines, notably of those websites through which undertakings offer goods and services to consumers, has an important impact on consumer choice and the commercial success of corporate_website_users.

  Providers of online_search_engines should therefore provide a description of the main parameters determining the ranking of all indexed websites and the relative importance of those main parameters as opposed to other parameters, including those of corporate_website_users as well as other websites.

  In addition to the characteristics of the goods and services and their relevance for consumers, this description should in the case of online_search_engines also allow corporate_website_users to obtain an adequate understanding of whether, and if so how and to what extent, certain design characteristics of the website used, such as their optimisation for display on mobile telecommunications devices, is taken into account.

  It should also include an explanation of any possibility for corporate_website_users to actively influence ranking against remuneration, as well as an explanation of the relative effects thereof.

  In the absence of a contractual relationship between providers of online_search_engines and corporate_website_users, that description should be available to the public in an obvious and easily accessible location on the relevant online_search_engine.

  Areas of websites that require users to log in or register should not be understood as easily and publicly available in this sense.

(29) Ancillary goods and services should be understood as goods and services offered to the consumer immediately prior to the completion of a transaction initiated on online_intermediation_services to complement the primary good or service being offered by the business_user.

  Ancillary goods and services refer to products that typically depend on, and are directly related to, the primary good or service in order to function.

  Therefore, the term should exclude goods and services that are merely being sold in addition to the primary good or service in question rather than being complementary in their nature.

  Examples of ancillary services include repair services for a specific good or financial products such as car rental insurance offered so as to complement the specific goods or services being offered by the business_user.

  Likewise, ancillary goods might include goods that complement the specific product being offered by the business_user by constituting an upgrade or a customisation tool linked to that specific product.

  Providers of online_intermediation_services offering goods or services to consumers that are ancillary to a good or service sold by a business_user, using their online_intermediation_services, should set out in their terms_and_conditions a description of the type of ancillary_goods_and_services being offered.

  such a description should be available in the terms_and_conditions regardless of whether the ancillary good or service is being provided by the provider of online_intermediation_services itself or by a third party.

  such a description should be comprehensive enough to allow a business_user to understand whether any good or service is being sold as ancillary to the business_user’s good or service.

  The description should not necessarily include the specific good or service, but rather the type of product being offered as complementary to the primary product of the business_user.

  Furthermore, this description should in all circumstances include whether and under what conditions a business_user is allowed to offer its own ancillary good or service in addition to the primary good or service that it is offering through the online_intermediation_services.

(30) Where a provider of online_intermediation_services itself offers certain goods or services to consumers through its own online_intermediation_services, or does so through a business_user which it controls, that provider might compete directly with other business_users of its online_intermediation_services which are not controlled by the provider, which might give the provider an economic incentive and the ability to use its control over the online_intermediation_services to provide technical or economic advantages to its own offering, or those offered through a business_user which it controls, which it could deny to competing business_users.

  such behaviour could undermine fair competition and restrict consumer choice.

  In such situations, in particular, it is important that the provider of online_intermediation_services acts in a transparent manner and provides an appropriate description of, and sets out the considerations for any differentiated treatment, whether through legal, commercial or technical means, such as functionalities involving operating systems that it might give in respect of goods or services it offers itself compared to those offered by business_users.

  To ensure proportionality, this obligation should apply at the level of the overall online_intermediation_services, rather than at the level of individual goods or services offered through those services.

(31) Where a provider of an online_search_engine itself offers certain goods or services to consumers through its own online_search_engine, or does so through a corporate_website_user which it controls, that provider might compete directly with other corporate_website_users of its online_search_engine which are not controlled by the provider.

  In such situations, in particular, it is important that the provider of the online_search_engine acts in a transparent manner and provides a description of any differentiated treatment, whether through legal, commercial or technical means, that it might give in respect of goods or services it offers itself or through a corporate_website_user which it controls, compared to those offered by competing corporate_website_users.

  To ensure proportionality, this obligation should apply at the level of the overall online_search_engine, rather than at the level of individual goods or services offered through those services.

(33) The ability to access and use data, including personal data, can enable important value creation in the online platform economy, both generally as well as for the business_users and online_intermediation_services involved.

  Accordingly, it is important that providers of online_intermediation_services provide business_users with a clear description of the scope, nature and conditions of their access to and use of certain categories of data.

  The description should be proportionate and might refer to general access conditions, rather than an exhaustive identification of actual data, or categories of data.

  However, identification of and specific access conditions to certain types of actual data that might be highly relevant to the business_users could also be included in the description.

  such data could include ratings and reviews accumulated by business_users on the online_intermediation_services.

  Altogether, the description should enable business_users to understand whether they can use the data to enhance value creation, including by possibly retaining third-party data services.

(34) In the same vein, it is important for business_users to understand whether the provider shares with third parties any data which has been generated through the use of the intermediation service by the business_user.

  Business users should in particular be made aware of any sharing of data with third parties that occurs for purposes which are not necessary for the proper functioning of the online_intermediation_services; for example where the provider monetises data under commercial considerations.

  To allow business_users to fully exercise available rights to influence such data sharing, providers of online_intermediation_services should also be explicit about possibilities to opt out from the data sharing where they exist under their contractual relationship with the business_user.

(36) Providers of online_intermediation_services might in certain cases restrict in their terms_and_conditions the ability of business_users to offer goods or services to consumers under more favourable conditions through other means than through those online_intermediation_services.

  In those cases, the providers concerned should set out the grounds for doing so, in particular with reference to the main economic, commercial or legal considerations for the restrictions.

  This transparency obligation should however not be understood as affecting the assessment of the legality of such restrictions under other acts of Union law or the law of Member States that is in accordance with Union law, including in the areas of competition and unfair commercial practices, and the application of such laws.

(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.

(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.

(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.

(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.