New Year’s resolution: Make sure your online distribution chain is compliant
European product law is tailored to bricks-and-mortar retail. But of course products sold online should also meet the requirements for lawful placing on the European market. When applying and interpreting European product law, however, there are a few online-specific issues, which to date have only been touched upon briefly in the European Commission’s Blue Guide and which are controversial among legal practitioners.
The European Commission has now stated its position in a Notice (Commission Notice 2017/C 250/01) on some of the interpretation and application difficulties specifically in connection with online retailing. Although this Notice is not legally binding, over the next few months there is likely to be more checking of non-food products sold online by the European market surveillance authorities in line with the interpretation instructions of the European Commission.
One of the greatest difficulties authorities have encountered in monitoring products sold online over the past few years is tracing and identifying the economic operators responsible. What’s more, the economic operators involved in online retailing, such as fulfilment centres, have not been clearly addressed in European product law to date. The responsibility of such operators becomes relevant especially when the manufacturer is based outside of the EU and due to direct shipment to the end customer there is no EU importer. The European Commission now takes the position in its Notice that a fulfilment centre is normally to be considered a distributor. But of course it can also be an importer or even manufacturer with correspondingly greater product responsibility if it presents itself as such on the market.
Another focus of market surveillance in online retailing is the scope of obligations of online stores and online platforms. It is very uncertain whether and to what extent an online platform, for example, is required to search its offerings for non-compliant products and to remove them. Based on the Directive on Electronic Commerce 2000/31/EC, the European Commission highlights the option of excluding liability for third-party content, but this is tied to certain conditions.
Also, the Notice deals with the date of placing goods on the market in online retail and practical aspects such as strategies and organisation of online market surveillance.
In light of this, increased monitoring by the market surveillance authorities is likely, including by way of random checks at the economic operators involved. Each economic operator should therefore check whether its product compliance system meets the requirements set out in the Commission Notice.
Any Questions? Please contact: Dr. Susanne Wende, Prof. Dr. Thomas Klindt
Practice Group: Litigation, Arbitration & ADR, Commerce & Trade