In recent years, online platforms have become a means of trade and easier access to consumers. This has created new markets and intensified competition among online merchants. There are numerous online platforms through which online merchants offer their goods and services, such as Ebay, Amazon, Etsy, OLX, eMag, and others. These platforms allow the registration of a so-called “business account” or “merchant account,” through which registered individuals can offer and sell their goods and/or services to the users of these online platforms. As a result, many online merchants register accounts and conduct trade on these online platforms.
In this created online trading environment, an important question arises: What is the protection of the rights of online merchants on these online platforms?
Online platforms administer and maintain the created online trading environment and monitor violations by both users and online merchants. Online platforms can restrict a particular online merchant from offering goods and/or services, or even suspend their activity, such as by deleting the merchant’s account or through other means. They also determine whose goods/services are promoted higher or lower in rankings compared to other online merchants. Online platforms can also specify which goods/services an online merchant can offer or prohibit a specific online merchant from offering certain goods/services. For these various reasons, European legislation has adopted Regulation (EU) 2019/1150 of the European Parliament and of the Council to promote fairness and transparency for business users of online intermediation services. This regulation sets out obligations for online platforms or so-called “online intermediation service providers,” as well as rights for online merchants or so-called “business users.”
The primary obligation of online platforms under the regulation is to establish and approve “Terms and Conditions,” which regulate the conditions for suspension, termination, or imposition of other types of restrictions, in whole or in part, on the provision of services by online merchants. Conditions for the ranking of online merchants, differential treatment, and access to the internal complaint resolution system should also be addressed. The Terms and Conditions must be easily accessible to the online merchant so that they can familiarize themselves with them at any given time. The Terms and Conditions constitute a contract concluded between the provider of online intermediation services (the online platform) and the business user (the online merchant). This contract is entered into by the online merchant’s acceptance of the Terms and Conditions during the registration of their account on the online platform. The online merchant should carefully review these Terms and Conditions, as they govern the conditions under which goods/services should be offered.
The regulation introduces a fundamental obligation for online platforms to establish an internal complaint-handling system for complaints submitted by online merchants. This system allows online merchants to file complaints when they believe there is any of the following:
- Presumed non-compliance by the online platform with any of the obligations under the regulation.
- Technological problems directly related to the provision of services on the online platform, resulting in consequences for the online merchant.
- Measures or behavior of the online platform (the provider of online intermediation services) directly related to the services provided on the online platform and resulting in consequences for the online merchant.
Online merchants can use this procedure to submit their complaints to the administrator of the online platform.
Another introduction in the regulation is the institution of mediation. Online platforms are required in their Terms and Conditions to specify two or more mediators regarding dispute resolution between the online platform and the online merchant. The regulation sets out the procedure applicable to raising a dispute.
One of the main innovations in the regulation is the possibility for online merchants to be represented by non-profit legal entities. This means that online merchants can create their organization to represent them before online platforms and bring disputes affecting multiple online merchants to court. This right is particularly important as it allows for the resolution of disputes affecting multiple online merchants. The regulation sets out the conditions for registering such an organization. It is important to note, however, that according to Article 14, paragraph 9 of the regulation, the right of online merchants to bring a dispute through their organization to court does not affect the right of each online merchant individually to bring claims before the competent national courts for any non-compliance by online platforms.
