On 12 July 2020, the P2B Regulation (Regulation 2019/1150 on promoting fairness and transparency for business users of online intermediation services) became applicable in the UK.
This is directed at online marketplaces and search engines, with the intention of encouraging these platforms to deal with the businesses that use their platforms in a more transparent and fair way.
What is the main aim of the P2B Regulation?
The aim is to strengthen the rights of small and medium-sized enterprises against the powerful online intermediaries and search engines.
Many platforms have become so significant that businesses need to be listed on them in order to compete within their market and survive against bigger players.
The purpose of this Regulation is to level out the playing field for these smaller businesses, and to require platforms to be more transparent and fairer in their dealings with business users.
Who does this new regulation apply to?
The P2B Regulation will apply to undertakings offering online intermediation services or search engines with websites available within the EU, even if their registered offices are outside of the EU.
There are a number of relationships and businesses that are excluded from the scope of the P2B Regulation:
- Pure business-to-business online intermediation services that do not aim to initiate direct transactions with consumers;
- Peer-to-peer online intermediation services that does not involve business users;
- Online advertising tools and 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;
- SEO software services as well as services which revolve around advertising-blocking software; and
- Online payment services.
What are the main provisions that businesses affected should be aware of?
- Transparent Terms & Conditions
Standard terms and conditions must be in plain language and easily available. Any changes to terms and conditions must be announced in advance, with at least 15 days’ notice required to business users.
2. Controls on suspension and termination
Platforms must now do the following before terminating a business user:
Platforms must provide all business users with details of the main parameters used to rank search engine results and provide a high-level overview of the operation of the search engine.
However, there is no obligation to provide any algorithms or sensitive information regarding the search engines, only whether and how certain businesses receive higher listings than others in certain categories.
If a website is demoted or delisted from a platform’s search as a result of a notification from a third party (e.g. an allegation of IP right infringements), the website owner should be able to view such notifications.
4. Dispute resolution
Platforms are required to offer business users a variety of dispute resolution methods, including internal complaints handling procedures, and the option of mediation. Platforms are also required to follow additional transparent rules in relation to disputes.
What does this mean for your business?
If your business is an online platform trading with other businesses, you will need to ensure your terms and conditions are compliant with the P2B Regulation. You will need to maintain certain information on your site in line with the Regulation, and will need to have the correct complaints procedures in place.
If you are a business user operating via an online platform affected by this Regulation, you may not have any direct actions to take, but it is important to know your rights under the Regulation. If your business relies on these platforms for its existence, being aware of, and able to enforce, these rights could be vital to your success!
If want to discuss how your business is affected and what your new rights or obligations are under the P2B Regulation, give us a call! The Devant team will be happy to help you work through the various options you may have.