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New regulation supports businesses using online platforms to trade

On 12 July 2020, the P2B Regulation became applicable in the UK. The Regulation is aimed at online marketplaces and search engines and their dealings with the businesses that use their platforms, to encourage fairness and transparency.

 

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On 12 July 2020, the P2B Regulation (Regulation 2019/1150 on promoting fairness and transparency for business users of online intermediation services) became applicable in the UK.

The Regulation is aimed at online marketplaces and search engines and their dealings with the businesses that use their platforms. The aim of the Regulation is to encourage platforms to deal with businesses in a transparent and fair manner. Further information is included below.

Who does the Regulation apply to?

The Regulation is intended to apply to platforms providing their services to businesses in the EU and those that offer goods or services to consumers in the EU in the following sectors:

  • online e-commerce marketplaces (e.g. Amazon Marketplace and eBay);
  • online software applications services (such as the App Store and Google Play);
  • online social media platforms (e.g. Instagram or Facebook); and
  • online search engines (such as Google or Bing).

Certain types of online businesses, like online retailers selling direct to consumers and AdTech are excluded from the Regulation.

Key provisions

The main changes that the Regulation has introduced are as follows:

(1) Transparent terms and conditions: all standard terms and conditions must be in plain and intelligible language, easily available and transparent. The terms and conditions can only be modified if announced in advance and will typically require 15 days’ notice to the business user. The terms and conditions must also include information on:

    • When the business user can terminate their relationship with the platform;
    • When the platform can suspend, restrict or terminate a business user’s use of their service;
    • How a business user can access their personal data or other data generated through their use of the platform;
    • Include any restrictions on products that can be sold by business users via the platform; and
    • The additional channels and potential affiliate programmes through which a business user’s products will be marketed by the platform.

(2) Controls on suspension and termination: Before terminating a business user, platforms must now:

    • Give the user a statement of reasons for that decision on a durable medium;
    • Provide at least 30 days’ prior warning (in most cases) of termination;
    • Preserve the business user’s data so that the account can be reinstated if the account is closed in error.

(3) Ranking: platforms must also provide business users with details of the main parameters used to rank search engine results and give a high-level overview of the operation of the search engine (but there is no obligation to provide its algorithm or other sensitive information). If a website is demoted or delisted from a platform’s search result as a result of a third party notification (such as an allegation of an infringement of IP rights), the website owner should be able to view the notification.

(4) Dispute resolution: the Regulation also requires platforms to offer business users a variety of methods to resolve disputes, including an internal complaints handling process and providing the option of mediation. Platforms must also follow certain transparency requirements in relation to disputes.

Does the Regulation affect me?

If you are an online platform trading with businesses, your terms and conditions may need to be amended to ensure compliance with the Regulation. You may also need to publish certain information on your website and in your terms and conditions, and update your complaints handling process. Collyer Bristow would be happy to discuss these matters with you.

If you are a business user operating via an online platform affected by the Regulation, we would be delighted to discuss the new rights and options available to you under the Regulation. We are also happy to advise you on the compliance of any platform(s) you use to trade.

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Howard Ricklow

Partner

howard.ricklow@collyerbristow.com