On the 12th July 2020, the EU P2B Regulation (Regulation (EU) 2019/1150) came into force in the European Union (EU). The new rules aim to facilitate the proper functioning of the internal market by laying down rules to ensure that business users of online intermediation services and corporate website users in relation to online search engines are granted appropriate transparency, fairness and effective redress possibilities. Since the new rules are set-out in a Regulation rather than a Directive, they are directly applicable across all EU member states. Within scope entities will need to make some changes to their current business practises and terms and conditions, as further explained below.

To whom does the EU P2B Regulation apply?

The Regulation applies to online platforms (referred to as providers of online intermediation services) and search engines that provide their services to business and corporate users established in the EU, where those businesses offer goods or services to consumers located in the EU.

The Regulation does not apply to online payment services or to online advertising tools or 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.

Terms and Conditions

Online platforms must ensure that their terms and conditions:

(a) are drafted in plain and intelligible language;

(b) are easily available to business users at all stages of their commercial relationship with the provider of online intermediation services, including in the pre-contractual stage;

(c) set out the grounds for decisions to suspend or terminate or impose any other kind of restriction upon business users;

(d) include information on any additional distribution channels and potential affiliate programmes through which providers of online intermediation services might market goods and services offered by business users;

(e) include general information regarding the effects of the terms and conditions on the ownership and control of intellectual property rights of business users.

Changes to Terms and Conditions

Any changes to the online platform’s terms and conditions must be notified to business users in a “durable medium” and shall not (unless exempted in terms of the next paragraph) be implemented before the expiry of a notice period which cannot be less than 15 days from the date of notification. Furthermore, online platforms shall grant longer notice periods when this is necessary to allow business users to make technical or commercial adaptations to comply with the changes.

Online platforms need not give notice where (a) the online platform is subject to a legal or regulatory obligation which requires it to change its terms and conditions in a manner which does not allow it to respect the notice period, or if the online platform (b) has exceptionally to change its terms and conditions to address an unforeseen and imminent danger related to defending the online intermediation services, consumers or business users from fraud, malware, spam, data breaches or other cybersecurity risks.

Notice of restriction or suspension from the platform

When the online platform decides to restrict or suspend the use of its platform to a given business user in relation to individual goods or services offered by that business user, it shall provide the business user concerned, 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.

Notice of termination from the platform

Where the online platform decides to terminate the provision of the whole of its online intermediation services to a given business user, it shall provide the business user concerned, at least 30 days prior to the termination taking effect, with a statement of reasons for that decision on a durable medium. During this time, the business user shall be given the opportunity to clarify the facts and circumstances in line with the online platform’s internal complaint-handling process.

The above mentioned notice period of 30 days shall not apply where the online platform:

(a) is subject to a legal or regulatory obligation which requires it to terminate its services to a given business user in a manner which does not allow it to respect that notice period; or

(b) exercises a right of termination under an imperative reason pursuant to national law which is in compliance with EU law;

(c) can demonstrate that the business user concerned has repeatedly infringed the applicable terms and conditions, resulting in the termination of the provision of the whole of the online intermediation services in question.

Ranking Transparency

Online platforms must set out in their terms and conditions the main parameters determining ranking and the reasons for the relative importance of those main parameters as opposed to other parameters.

Similarly online search engines must set out the main parameters, which individually or collectively are most significant in determining ranking and the relative importance of those main parameters, by providing an easily and publicly available updated description, drafted in plain and intelligible language. For example, here one can see how Google’s search algorithms work. Google explains that its search algorithms look at many factors, including the words of your query, relevance and usability of pages, expertise of sources and your location and settings. The weight applied to each factor varies depending on the nature of your query.

Where it is possible to influence one’s ranking by making payment to the online platform or search engine, that provider shall also set out a description of those possibilities and of the effects of such remuneration on ranking. It should be noted, however, that online platforms and online search engines are not required to disclose algorithms or any information that, with reasonable certainty, would result in the enabling of deception of consumers or consumer harm through the manipulation of search results.

Ancillary goods and services

Where ancillary goods and services, including financial products, are offered to consumers through the online intermediation services, either by the online platform itself or by third parties, the online platform shall set out in its terms and conditions:

• a description of the type of ancillary goods and services offered; and

• a description of whether and under which conditions the business user is also allowed to offer its own ancillary goods and services through the online platform.

Disclosure of differentiated treatment

Online platforms and search engines must disclose any differentiated treatment given to their own group’s goods and services. Such differentiated treatment may include access to specific settings or functionality that influences consumer access to those goods or services, sharing of personal data, etc.

Specific contractual terms

In order to ensure that contractual relations between online platforms and business users are conducted in good faith and based on fair dealing, online platforms shall:

(a) not impose retroactive changes to terms and conditions, except when they are required to respect a legal or regulatory obligation or when the retroactive changes are beneficial for the business users;

(b) ensure that their terms and conditions include information on the conditions under which business users can terminate the contractual relationship; and

(c) include in their terms and conditions a description of the technical and contractual access, or absence thereof, to the information provided or generated by the business user, which they maintain after the expiry of the contract between the online platform and the business user.

Internal complaint-handling system

Online platforms that are not ‘small enterprises’* are required to provide an easily accessible and free internal system for handling the complaints of business users.

Mediation

Online platforms that are not ‘small enterprises’ (i.e., an enterprise which employs fewer than 50 persons and whose annual turnover and/or annual balance sheet total does not exceed EUR 10 million) must also identify in their terms and conditions two or more independent and impartial mediators with which they are willing to engage to attempt to reach an agreement with business users on the settlement, out of court, of any disputes between the provider and the business user arising in relation to the provision of the online intermediation services concerned, including complaints that could not be resolved by means of the internal complaint-handling system referred to in the preceding paragraph.

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