Digital Single Market: EU negotiators agree to set up new European rules to improve fairness of online platforms’ trading practices

Ansip 2019 European Union

Statement by Andrus Ansip, Vice-President of the EC in charge of Digital Single Market, on the modernization of copyright in the European Union, new rules of transparency and fairness for online platforms and prior agreement on the Digital Europe Program. © European Union , 2019 / Photo: Lukasz Kobus.

This article is brought to you in association with the European Commission.

Yesterday evening the European Parliament, the Council of the European Union and the European Commission reached a political deal on the first-ever rules aimed at creating a fair, transparent and predictable business environment for businesses and traders when using online platforms.
Traders selling online via marketplaces, hotels using booking platforms, or app developers are amongst those who will benefit from the new rules agreed today. The new Regulation will create a more predictable and transparent trading environment online, and will offer new possibilities for resolving disputes and complaints. As part of the Digital Single Market strategy, the new rules will apply to the entire online platform economy – approximately 7000 online platforms or market places operating in the EU, –which include world giants as well as very small start- ups, but having often an important bargaining power vis a vis business users. Certain provisions will also apply to search engines, notably the ones concerning ranking transparency. Vice-President for the Digital Single Market Andrus Ansip said: “Today’s agreement marks an important milestone of the Digital Single Market that will benefit millions of European companies relying on digital platforms to reach their customers. Our target is to outlaw some of the most unfair practices and create a benchmark for transparency, at the same time safeguarding the great advantages of online platforms both for consumers and for businesses.” Commissioner for Internal Market, Industry, Entrepreneurship, and SMEs, Elżbieta Bieńkowska, stated: “Our new rules are especially designed with the millions of SMEs in mind, which constitute the economic backbone of the EU. Many of them do not have the bargaining muscle to enter into a dispute with a big platform, but with these new rules they have a new safety net and will no longer worry about being randomly kicked off a platform, or intransparent ranking in search results.” Commissioner for the Digital Economy and Society, Mariya Gabriel, added: These are the first rules of this kind anywhere in the world, and they strike the right balance between stimulating innovation while protecting our European values. They will improve the relationship between businesses and platforms, making it fairer and more transparent, and ultimately leading to great advantages for the consumers. We will closely monitor the evolution of this field, not least through our Online Platform Observatory. According to a Eurobarometer survey almost half (42%) of small and medium companies in the EU said they use online marketplaces to sell their products and services. An impact assessment carried out by the Commission ahead of its proposals showed that nearly 50% of European businesses operating on platforms experience problems. Some 38% of problems regarding contractual relations remain unsolved, and 26% are solved but with difficulties; around €1.27-2.35 billion are lost directly in sales as a result. Small businesses will particularly benefit immediately from:
  1. A ban on certain unfair practices
  • No more sudden, unexplained account suspensions. With the new rules, digital platforms can no longer suspend or terminate a seller’s account without clear reasons, and possibilities to appeal. The platform will also have to reinstate sellers if a suspension was made in error.
  • Plain and intelligible terms and advance notice for changes. Terms and conditions must be easily available and provided in plain and intelligible language. When changing these terms and conditions, at least 15 days prior notice needs to be given to allow companies to adapt their business to these changes. Longer notice periods apply if the changes require complex adaptions.
 
  1. Greater transparency in online platforms
  • Transparent ranking. Marketplaces and search engines need to disclose the main parameters they use to rank goods and services on their site, to help sellers understand how to optimise their presence. The rules aim to help sellers without allowing gaming of the ranking system.
  • Mandatory disclosure for a range of business practices. Some online platforms not only provide the marketplace, but are also sellers on the same marketplace at the same time. According to the new transparency rules platforms must exhaustively disclose any advantage they may give to their own products over others. They must also disclose what data they collect, and how they use it – and in particular how such data is shared with other business partners they have. Where personal data is concerned, the rules of the GDPR apply.
 
  1. New avenues for dispute resolution.
Today sellers are often left stranded with no ways to appeal or resolve complaints when problems arise. This will change with the new rules.
  • All platforms must set up an internal complaint-handling system to assist business users. Only the smallest platforms in terms of head count or turnover will be exempt from this obligation.
  • Platforms will have to provide businesses with more options to resolve a potential problem through mediators. This will help resolve more issues out of court, saving businesses time and money.
  1. Enforcement
    • Business associations will be able to take platforms to court to stop any non-compliance with the rules. This will help overcome fear of retaliation, and lower the cost of court cases for individual businesses, when the new rules are not followed. In addition, Member States can appoint public authorities with enforcement powers, if they wish, and businesses can turn to those authorities.
Next Steps The new rules will apply 12 months after its adoption and publication, and will be subject to review within 18 months thereafter, in order to ensure that they keep pace with the rapidly developing market. The EU has also set up a dedicated Online Platform Observatory to monitor the evolution of the market and the effective implementation of the rules. Background Platforms offer a wide range of opportunities for fast and efficient access to international consumer markets, which is why they have become the go-to place for millions of successful businesses. However, certain structural issues lead to unfair trading practices between businesses that have come to depend on online platforms to reach their customers and undermine the innovation potential of platforms. The Commission’s Communication on Online Platforms of May 2016 identified certain areas where more efforts are needed to ensure a trusting, lawful and innovation-driven ecosystem in the EU. As a result in April 2018 theCommission made a proposal for an EU Regulation on fairness and transparency in online platform trading as well as for the creation of anObservatory on the online platform economy. This initiative delivers on the commitment made in President Juncker’s 2017 State of the Union address to safeguard a fair, predictable, sustainable and trusted business environment in the online economy. The new rules are underpinned by an impact assessment that incorporates evidence and stakeholders’ views collected during a two-year fact-finding exercise.

Discover more from The European Sting - Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology - europeansting.com

Subscribe to get the latest posts sent to your email.

Interesting reads

© WHO/Hedinn Halldorsson WHO Director-General Tedros and a health expert during operations involving the MV Hondius off Tenerife amid the hantavirus response.

Hantavirus-hit ship evacuation completed as quarantines begin

This article is published in association with United Nations. The passengers and crew have disembarked from the hantavirus-hit cruise ship MV Hondius in Tenerife and many have returned to their home countries, as the UN World Health Organization (WHO) said the operation demonstrated a “triumph of solidarity”. The repatriation effort, coordinated by Spanish authorities with support […]
© NASA The Strait of Hormuz which separates the United Arab Emirates and Iran is a strategically important shipping route

Strait of Hormuz de-escalation is urgent, says UN chief

This article is published in association with United Nations. As the Strait of Hormuz crisis deepens and tensions between Iran and the United States remain unresolved, oil prices rose again early Monday, prompting the UN Secretary-General to call for a peaceful resolution and warn of the widening fallout across Africa and beyond. “My strong appeal is […]
This article is published in association with United Nations.

Ukraine: Over 3,000 attacks on healthcare since full-scale Russian invasion

This article is published in association with United Nations. The World Health Organization (WHO) has verified more than 3,000 attacks on healthcare in Ukraine since Russia launched its full-scale invasion in February 2022, the UN agency reported on Friday. “During 1,534 days of war, Ukraine’s healthcare system has experienced repeated attacks,” it said.  Every aspect of the system has been […]
WHO Passengers from MV Hondius assisted by Spanish and WHO health teams after disembarking.

Passengers leave hantavirus-hit cruise ship in Tenerife as WHO says outbreak ‘not another COVID’

This article is published in association with United Nations. Passengers and crew from the cruise ship MV Hondius began disembarking in Tenerife on Sunday under a tightly coordinated international health operation led by Spanish authorities and the World Health Organization (WHO), as officials sought to reassure the public that the outbreak “is not another COVID.” The […]
Nuclear energy in the Middle East: A realistic choice or a risk?

Nuclear energy in the Middle East: A realistic choice or a risk?

This article is published in association with United Nations. As global electricity demand grows, so does the popularity of nuclear energy. In the Middle East, several countries are evaluating or advancing nuclear power projects, balancing weighty issues such as regional security, climatic conditions and international cooperation. “Nuclear energy is at the intersection of energy demands, technological […]
© NASA The Strait of Hormuz which separates the United Arab Emirates and Iran is a strategically important shipping route

Bahrain and US float Security Council resolution on the Strait of Hormuz

This article is published in association with United Nations. Bahrain and the United States have circulated a draft Security Council resolution calling for Iran to cease attacks in the Strait of Hormuz, their ambassadors outlined to journalists at UN Headquarters in New York on Thursday. The text is supported by Kuwait, Qatar, Saudi Arabia and the […]
© CDC An enhanced microscopic image shows the Hantavirus.

Hantavirus outbreak: Another passenger contracts disease

This article is published in association with United Nations. It’s been confirmed that another passenger from the cruise liner linked to the outbreak of hantavirus has contracted the disease, which has claimed the lives of three people on board and sparked an international alert coordinated by the UN World Health Organization (WHO). The individual, who is […]
This article is published in association with United Nations.

UN warns of worsening human rights crisis in Mali after deadly attacks

This article is published in association with United Nations. The human rights situation in Mali is rapidly deteriorating following coordinated attacks by armed groups across the country, with civilians killed, displaced and cut off from food and aid, UN rights office OHCHR said on Tuesday. The violence, which erupted on 25 and 26 April, saw large-scale […]
© UNICEF A damaged ambulance in Tebnine in southern Lebanon.

In Lebanon, the same fears and dangers persist despite ceasefire: UNHCR

This article is published in association with United Nations. Death and destruction have continued unabated in Lebanon while communities are still unable to return to their homes despite a ceasefire that began on 17 April, humanitarians said on Tuesday. “Civilians in the south of Lebanon and parts of the Bekaa [Valley] are really living with the […]
© Unsplash/Planet Volumes A computer-generated image shows the Strait of Hormuz.

Uncertainty continues over safety in the Strait of Hormuz

This article is published in association with United Nations. Amid claims and counter-claims of strikes and confrontations in the crucial Strait of Hormuz between Iran and the United States, UN maritime officials continue to urge vessels to exercise “maximum caution”. “We are aware of the reports but do not have further details. We continue to urge […]
© ADB/Ariel Javellana Women farmers in India sell wheat grain and buy fertilizer with the proceeds.

Middle East crisis puts aid, food, fuel further out of reach for millions already struggling – UN agencies

This article is published in association with United Nations. As the Middle East crisis continues the humanitarian fallout is worsening, with aid route disruptions and food and fuel price hikes wrecking the lives and the rights of the most vulnerable people worldwide, UN agencies warned on Friday. Heightened insecurity and instability around key Gulf routes, including […]
© Unsplash/Angus Gray Ship transits through the Strait of Hormuz have dropped by over 90 per cent since the crisis escalated in late February 2026.

Hormuz crisis strangling global economy, Guterres warns, demanding solutions to end stalemate

This article is published in association with United Nations. The escalating crisis in the Strait of Hormuz could push tens of millions into poverty, trigger a surge in global hunger and even tip the world towards recession, the UN Secretary-General warned on Thursday. António Guterres decried the restrictions on free passage through the crucial chokepoint which […]
This article is published in association with United Nations.

AI in advertising risks fuelling information crisis, UN warns

This article is published in association with United Nations. With spending on advertising topping $1 trillion a year worldwide, the United Nations on Wednesday highlighted the untapped power of major brands to shape the future of Artificial Intelligence, warning that a failure to act could deepen a global information integrity crisis. In a new brief titled […]
This article is published in association with United Nations.

2015 nuclear deal ‘no basis’ for any new agreement with Iran

This article is published in association with United Nations. The 2015 nuclear accord with Iran cannot be the starting point for a new agreement with the country, the head of the International Atomic Energy Agency (IAEA) said on Wednesday in New York.  Rafael Mariano Grossi was speaking during a press conference at UN Headquarters held on […]
Credit:Unsplash)

From Hormuz to Lebanon, crisis reverberates through trade routes, upending humanitarian networks

© WHO/Hanan Balkhy In Gaza displaced families are living in overcrowded tents and makeshift shelters, surrounded by waste and debris, with limited access to safe water and sanitation services. This article is published in association with United Nations. Disruptions in the Strait of Hormuz continue to send shockwaves through global food systems, the UN Food and Agriculture […]
© UNICEF/Mohamed Zakaria A displacement centre in El Fasher, North Darfur (file).

World News in Brief: Sudan drone attacks condemned, South Sudan violence, airstrikes in Ukraine, South Africa Freedom Day

This article is published in association with United Nations. The United Nations has condemned two recent drone attacks in Sudan, one of which left seven dead, Spokesperson Stéphane Dujarric said on Monday during his regular media briefing in New York. An aid truck from the UN refugee agency (UNHCR) that was carrying emergency shelter kits came under attack by […]
© IMO/Cihancan Tunay A ship makes its way across an ocean.

Chokepoints and conflict: How the Hormuz crisis is exposing global shipping vulnerabilities

This article is published in association with United Nations. The blockading of ships in the Strait of Hormuz as a result of the conflict between the United States and Iran has demonstrated how ships and seafarers have become “leverage in geopolitical disputes,” according to the head of the UN’s International Maritime Organization (IMO). Since conflict began […]
Middle East war: After oil and gas, concerns grow over minerals crunch

Middle East war: After oil and gas, concerns grow over minerals crunch

This article is published in association with United Nations. The shipping crisis in the Strait of Hormuz caused by war in the Middle East has exposed a new threat: a looming shortage of strategic minerals that drive economies all over the world – and a race by countries to obtain them. Until war erupted on 28 […]
This article is published in association with United Nations.

Ceasefire extension offers diplomatic opening, but tensions persist in Strait of Hormuz

This article is published in association with United Nations. The United States’ decision to extend a fragile ceasefire with Iran has kept a narrow window open for diplomacy, but fresh security incidents in the Strait of Hormuz on Wednesday underscore the volatility of the situation and the risks to global shipping and regional stability. The UN […]

Why don't you drop your comment here?

Go back up

Discover more from The European Sting - Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology - europeansting.com

Subscribe now to keep reading and get access to the full archive.

Continue reading

Discover more from The European Sting - Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology - europeansting.com

Subscribe now to keep reading and get access to the full archive.

Continue reading

The European Sting – Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology – europeansting.com