Today, the Competitiveness Council of the European Union agreed on a General Approach on the Commission’s Proposal for a Regulation on Platform-to-Business relations. Overall, Ecommerce Europe praises the fact that the Council adopted a soft-touch, principle-based approach, close to the Commission’s original approach towards relations between platforms and their business users.
From an e-commerce perspective, online platforms, such as marketplaces, are engines of growth and Ecommerce Europe wants to stress that this Regulation should strike the right balance between their interests and the interests of their users (online merchants), especially SMEs that sell via marketplaces.
In this perspective, it is therefore important to put in place a harmonized framework for minimum transparency and redress rights, which should protect companies that depend on online platforms for reaching consumers, while crucially safeguarding platforms’ innovation potential
After a preliminary assessment of the text adopted today, despite noticing room for improvement on a detailed level, Ecommerce Europe generally supports the Council’s balanced approach focusing, on the one hand, on transparent terms and conditions on the main items important in the relation between online platforms and business users and, on the other hand, on effective redress systems.
In contrast with the Parliament’s ongoing discussions, the Council’s light-touch approach ensures the essential contractual freedom, competition and further innovation that the market needs and that platforms and business users are asking for. In fact, the Council does not introduce unreasonable “hard rules” for B2B relations, nor confusing and non-practical legal norms like fairness, non-discrimination and unfair practices and does not extend the scope to device operating systems and B2C provisions in a purely B2B regulations.
In this perspective, Ecommerce Europe also welcomes the revised text on ranking, which clarifies that online intermediation services should only outline, in general terms, the main parameters determining ranking and, more importantly, that it should not be required to disclose the detailed functioning of ranking mechanisms, including algorithms. This safeguard ensures that platforms will not be obliged to disclose trade secrets.
Ecommerce Europe also welcomes the Council’s approach on the attribution of the costs of mediation, since platforms will not have to bear in any case (even when the claim is unfunded) at least half of the total cost. Moreover, the obligation to yearly publish an overview of the functioning and effectiveness of the internal complaint handling system has been clarified and lightened.
Furthermore, Ecommerce Europe fully supports the extension of the transition period to 12 months following the day of publication as a period of six months would be far too short for businesses to properly implement the new provisions into their complex business and contract models.
To conclude, as mentioned above, Ecommerce Europe sees room for improvement in the text adopted today in the Council. For instance, Ecommerce Europe does not support the extension of the notification period for the reasons of terminating the intermediation service in whole or partially to 30 days without also explicitly allowing for exceptions in cases of abuse or non-compliance that obviously require a quicker response. We therefore reserve our right to further assess and analyze the Council’s text in detail and provide further guidance to the EU negotiators in view of the next legislative steps.