What does the Platform to Business Regulation mean for fashion?
Updated: Nov 20, 2021
The new Platform to Business Regulation (P2B regulation) applies across the EU from 12 July 2020. This Regulation is part of the EU's Digital Single Market Strategy. As the EU press release explains, the P2B Regulation is the first-ever set of rules creating a fair, transparent and predictable business environment for smaller businesses and traders on online platforms.
The Regulation is intended to create a fairer balance between online platforms and online search engines. It covers marketplaces, search engines, social media, apps and collaborative marketplaces. It will impact all fashion businesses that operate online.
The new rules offer brands (and other traders on platforms) more predictable rules and procedures. Whilst it applies to EU businesses (ie businesses offering or receiving services in the EU) like the GDPR, due to the international nature of online business, the new rules will inevitably affect all international businesses including those that are not primarily based in the EU.
Smaller businesses have less onerous requirements but most businesses will need to revisit their terms and conditions to check if updates are required.
This Regulation will continue to apply to the U.K. after the end of the Brexit transition period (1 January 2021). So at least there is certainty on one aspect of Brexit...
There is certain obligatory information that must be included in platform terms under the Regulation. This includes:
Article 5 The parameters affecting ranking of products including whether own brands are treated differently and whether it is possible to influence the ranking position through payment of additional commission or similar.
Article 9 Much more precise information regarding data is required to be included in the terms. This includes details of what data is collected and how that data is used. Importantly this isn’t limited to personal data (but obviously where personal data is included, the GDPR will also apply to that data). Data doesn’t need to be shared under the Regulation. The important point is that if it is shared, this fact must be disclosed. In other words the focus of the Regulation is on transparency.
Article 11 Complaints handling must follow a particular approach under the Regulation. However this responsibility can be delegated to external providers if required.
Article 12 Specialist mediators must be identified in the terms and conditions. This is designed to resolve more issues out of court and save time and money. Importantly, it doesn’t limit the parties’ rights to issue legal proceedings at any time.
Article 4 If platforms want to restrict, limit or terminate a user’s account they now have to comply with Article 4. This includes the requirement to give a statement of reasons for the decision and give the user an opportunity to clarify the facts that led to that decision. For business brands, 30 days prior notice must be given prior to termination.
The enforcement of the P2B Regulation is left to Member States under Article 15.
To find out more contact Rosie Burbidge, Intellectual Property Partner at Gunnercooke LLP in London - firstname.lastname@example.org