Considerations on COM(2018)238 - Promoting fairness and transparency for business users of online intermediation services

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dossier COM(2018)238 - Promoting fairness and transparency for business users of online intermediation services.
document COM(2018)238 EN
date June 20, 2019
 
table>(1)Online intermediation services are key enablers of entrepreneurship and new business models, trade and innovation, which can also improve consumer welfare and which are increasingly used by both the private and public sectors. They offer access to new markets and commercial opportunities allowing undertakings to exploit the benefits of the internal market. They allow consumers in the Union to exploit those benefits, in particular by increasing their choice of goods and services, as well as by contributing to offering competitive pricing online, but they also raise challenges that need to be addressed in order to ensure legal certainty.
(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.

(3)Consumers have embraced the use of online intermediation services. A competitive, fair, and transparent online ecosystem where companies behave responsibly is also essential for consumer welfare. Ensuring the transparency of, and trust in, the online platform economy in business-to-business relations could also indirectly help to improve consumer trust in the online platform economy. Direct impacts of the development of the online platform economy on consumers are, however, addressed by other Union law, especially the consumer acquis.

(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.

(5)The nature of the relationship between providers of online intermediation services and business users might also lead to situations in which business users often have limited possibilities to seek redress where unilateral actions of the providers of those services lead to a dispute. In many cases, those providers do not offer accessible and effective internal complaint-handling systems. Existing alternative out-of-court dispute settlement mechanisms can also be ineffective for a variety of reasons, including a lack of specialised mediators and business users’ fear of retaliation.

(6)Online intermediation services and online search engines, as well as the transactions facilitated by those services, have an intrinsic cross-border potential and are of particular importance for the proper functioning of the Union’s internal market in today’s economy. The potentially unfair and harmful commercial practices of certain providers of those services, and the lack of effective redress mechanisms, hamper the full realisation of that potential and negatively affect the proper functioning of the internal market.

(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.

(15)To ensure that the general terms and conditions of a contractual relationship enable business users to determine the commercial conditions for the use, termination and suspension of online intermediation services, and to achieve predictability regarding their business relationship, those terms and conditions should be drafted in plain and intelligible language. Terms and conditions should not be considered to have been drafted in plain and intelligible language where they are vague, unspecific or lack detail on important commercial issues and thus fail to give business users a reasonable degree of predictability on the most important aspects of the contractual relationship. Moreover, misleading language should not be considered to be plain and intelligible.

(16)In order to ensure that business users have sufficient clarity regarding where, and to whom, their goods or services are being marketed, providers of online intermediation services should ensure, towards their business users, the transparency of any additional distribution channels and potential affiliate programmes that they might use to market those goods or services. Additional channels and affiliate programmes should be understood in a technologically neutral manner but could, inter alia, include other websites, apps or other online intermediation services used to market the goods or services offered by the business user.

(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.

(18)Ensuring transparency in the general terms and conditions can be essential to promoting sustainable business relationships and to preventing unfair behaviour to the detriment of business users. Providers of online intermediation services should therefore also ensure that the terms and conditions are easily available at all stages of the commercial relationship, including to prospective business users at the pre-contractual phase, and that any changes to those terms are notified on a durable medium to business users concerned within a set notice period which is reasonable and proportionate in light of the specific circumstances and which is at least 15 days. Proportionate longer notice periods of more than 15 days should be given where the proposed changes to the terms and conditions require business users to make technical or commercial adaptations in order to comply with the change, for example by requiring them to make significant technical adjustments to their goods or services. That notice period should not apply where, and to the extent that, it is waived in an unambiguous manner by the business user concerned or where, and to the extent that, the need to implement the change without respecting the notice period stems from a legal or regulatory obligation incumbent on the service provider under Union or national law. However, proposed editorial changes should not be covered by the term ‘change’ in as far as they do not alter the content or meaning of terms and conditions. The requirement of notifying proposed changes on a durable medium should enable business users to review effectively these changes at a later stage. Business users should be entitled to terminate their contract within 15 days from the receipt of the notice of any change, unless a shorter period applies to the contract, for example as resulting from national civil law.

(19)In general, submitting new goods or services, including software applications, to the online intermediation services should be considered to be clear affirmative action, resulting in the waiving, by the business user, of the notice period required for changes to the terms and conditions. However, in cases where the reasonable and proportionate notice period is longer than 15 days because the changes to the terms and conditions require the business user to make significant technical adjustments to its goods or services, the notice period should not be considered to be automatically waived where the business user submits new goods and services. The provider of online intermediation services should expect the changes to terms and conditions to require the business user to make significant technical adjustments where, for example, entire features of the online intermediation services that business users had access to are removed or added, or where business users might need to adapt their goods or reprogramme their services to be able to continue to operate through the online intermediation services.

(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.

(21)In order to ensure that business users can fully exploit the commercial opportunities offered by online intermediation services, providers of these services should not completely prevent their business users from featuring their trading identity as part of their offering or presence on the relevant online intermediation services. However, this prohibition of interference should not be understood as a right for business users to unilaterally determine the presentation of their offering or presence on the relevant online intermediation services.

(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.

The statement of reasons regarding the decision to restrict, suspend or terminate the provision of online intermediation services should allow business users to ascertain whether there is scope to challenge the decision, thereby improving the possibilities for business users to seek effective redress where necessary. The statement of reasons should identify the grounds for the decision, based on the grounds that the provider had set out in advance in its terms and conditions, and refer in a proportionate manner to the relevant specific circumstances, including third party notifications, that led to that decision. However, a provider of online intermediation services should not be required to provide a statement of reasons for restrictions, suspensions or terminations insofar as it would infringe a legal or regulatory obligation. Furthermore, a statement of reasons should not be required where a provider of online intermediation services can demonstrate that the business user concerned has repeatedly infringed the applicable terms and conditions, resulting in termination of the provision of the whole of the online intermediation services in question.

(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.

(24)The ranking of goods and services by the providers of online intermediation services has an important impact on consumer choice and, consequently, on the commercial success of the business users offering those goods and services to consumers. Ranking refers to the relative prominence of the offers of business users or relevance given to search results as presented, organised or communicated by providers of online intermediation services or by providers of online search engines, resulting from the use of algorithmic sequencing, rating or review mechanisms, visual highlights, or other saliency tools, or combinations thereof. Predictability entails that providers of online intermediation services determine ranking in a non-arbitrary manner. Providers should therefore outline the main parameters determining ranking beforehand, in order to improve predictability for business users, to allow them to better understand the functioning of the ranking mechanism and to enable them to compare the ranking practices of various providers. The specific design of this transparency obligation is important for business users as it implies the identification of a limited set of parameters that are most relevant out of a possibly much larger number of parameters that have some impact on ranking. This reasoned description should help business users to improve the presentation of their goods and services, or some inherent characteristics of those goods or services. The notion of main parameter should be understood to refer to any general criteria, processes, specific signals incorporated into algorithms or other adjustment or demotion mechanisms used in connection with the ranking.

(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.

To ensure predictability for corporate website users, the description should also be kept up to date, including the possibility that any changes to the main parameters should be made easily identifiable. The existence of an up-to-date description of the main parameters would also benefit users other than corporate website users of the online search engine. In some cases, providers of online search engines can decide to influence the ranking in a specific case or delist a particular website from a ranking based on a third-party notification. Unlike providers of online intermediation services, providers of online search engines cannot, due to the lack of any contractual relationship between the parties, be expected to notify a corporate website user directly of a change in ranking order or a delisting due to a third party notification. Nevertheless, a corporate website user should be able to inspect the contents of the notification that has led to the change in ranking order in a specific case or to delisting of a particular website, by investigating the contents of the notification such as in a publicly accessible online database. That would help to mitigate potential abuses, by competitors, of notifications that could lead to delisting.

(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.

(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.

(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.

(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.

(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.

(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.

(37)In order to enable business users, including those whose use of the relevant online intermediation services might have been restricted, suspended or terminated, to have access to immediate, suitable and effective possibilities of redress, providers of online intermediation services should provide for an internal complaint-handling system. That internal complaint-handling system should be based on principles of transparency and equal treatment applied to equivalent situations, aimed at ensuring that a significant proportion of complaints can be solved bilaterally by the provider of online intermediation services and the relevant business user in a reasonable period of time. The providers of online intermediation services might maintain in force during the duration of the complaint the decision that they have taken. Any attempt to reach an agreement through the internal complaint handling-process does not affect the rights of providers of online intermediation services or business users to initiate judicial proceedings at any time during or after the internal complaint-handling process. In addition, providers of online intermediation services should publish and, at least annually, verify information on the functioning and effectiveness of their internal complaint-handling system to help business users to understand the main types of issues that can arise in the context of the provision of different online intermediation services and the possibility of reaching a quick and effective bilateral resolution.

(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.

(43)In order to facilitate the settlement of disputes relating to the provision of online intermediation services using mediation in the Union, the Commission should, in close cooperation with the Member States, encourage the setting up of specialised mediation organisations, which are currently lacking. The involvement of mediators having specialist knowledge of online intermediation services as well as of the specific industry sectors within which those services are provided should add to the confidence both parties have in the mediation process and should increase the likelihood of that process leading to a swift, just and satisfactory outcome.

(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.

In order to avoid a conflict of interest, organisations or associations representing business users or corporate website users should, in particular, be prevented from being subject to undue influence from any providers of online intermediation services or of any online search engines. The full and public disclosure of information on membership and source of financing should facilitate national courts in assessing whether these eligibility criteria are met. Considering the particular status of the relevant public bodies in Member States where such bodies have been set up, it should only be required that those have been specifically charged, in accordance with the relevant rules of national law, with bringing such actions either in the collective interest of the parties concerned or in the general interest, without there being a need to apply those criteria to such public bodies. Any such actions should in no way affect the rights of the business users and corporate website users to take judicial action on an individual basis.

(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,