January 28, 2019

Online marketplaces and comparison services (e.g. Amazon, eBay, AirBnb, Skyscanner) will have to disclose the main parameters determining how offers resulting from a search query are ranked and whether the authenticity of products’ reviews is checked, according to an amended proposal approved by the EU Parliament’s Internal Market and Consumer Protection Committee.

Consumers should also be able to know who is actually selling the product or service and should be provided with clear information prior to a purchase.

MEPs have added the following activities to the “blacklist” of the Unfair Commercial Practices Directive (Annex I, listing the practices prohibited in all circumstances):

• misleading consumers by stating that a review is truthful when no reasonable and proportionate steps have been taken to ensure that it is; and
• providing information in response to a consumer’s online search query in order to promote a product where a trader has directly or indirectly paid to promote or prominently place it, bypassing the main body of search results, without making that clear to the consumer.

The proposed legislation also tackles the so-called “dual quality of products” issue, i.e. when products marketed under the same brand differ in composition or characteristics. Creating the impression, by its appearance or description, that a good is seemingly identical to another good marketed in another Member State when it is not is to be considered a misleading practice, and has therefore been added it to the unfair commercial practices’ “blacklist”. MEPs agreed that goods could only differ “on account of clear and demonstrable regional consumer preferences, the sourcing of local ingredients or requirements of national law, while this distinction is clear and comprehensively marked so as to be immediately visible to the consumer”.

For cross-border infringements (i.e. those harming consumers in at least three EU countries or two countries other than that of the trader), the maximum amount of fines will be set at €10,000,000 or at least 4% of the trader’s annual turnover in the previous financial year in the Member State(s) concerned, whichever is higher.

MEPs rejected the Commission’s plans to reduce consumers’ rights to return goods. They reinstated the so-called “right of withdrawal”, i.e. the 14-day cooling-off period during which goods bought online can be returned.

The text will need to be approved by the full House in an upcoming plenary session before negotiations with the Council can start. To read the EU Parliament’s press release in full, click here.