Tuesday, 4 April 2017

Online sales platforms as consumer information providers - CJEU in Verband Sozialer Wettbewerb (C-146/16)

Misleading omissions are always problematic to define, as it needs first to be decided whether the information that is missing classifies as 'material information'. The case Verband Sozialer Wettbewerb (C-146/16) addressed the issue of misleading omissions, with an additional complication of information being provided within the sharing economy (understood as involving the use of online sales platforms).

DHL Paket has an online sales platform 'MeinPaket.de' (in the meantime it changed its name to de.allyouneed.com) facilitating conclusion of contracts between traders and purchasers, some of whom might be consumers. DHL Paket does not sell any of its own products there, which means that no sales contracts are concluded between them and consumers. In December 2012 DHL Paket took out an advertisement in a weekly newspaper Bild am Sonntag, in which advert they presented five different products available for purchase on their platform and mentioned providing access to over 5 million products and more than 2500 traders. Any person interested in the purchase of these five products could visit the online platform, enter the code corresponding to the product, as referred to in the advert. Only upon entering the product's code on the platform the consumer would be transported to a separate website, which would identify the trader selling this product. Under the heading 'Supplier information' further details of the trader, such as geographical address and the trading name, would be mentioned.

Competitors of DHL Paket complained that the identity of traders and their geographical address should be mentioned already in the advertisement, in order for it not to mislead consumers, on the basis of Article 7(4)(b) Unfair Commercial Practices Directive ("UCPD"). Therefore, they claimed that material information was missing from the advertisement and that the DHL Paket engaged in misleading omissions. One of the arising questions is, however, whether if the advertisement is printed but the product may only be purchased online, it would not suffice to provide this information on the website instead of in print, provided the printed advertisement refers to the website and it was easy to find this information on it. This would depend on whether consumers should receive material information pre-contractually (entering a website does not oblige consumers to conclude a contract) or prior to taking any transactional decision at all (entering a website counts as taking a transactional decision).

The CJEU confirms that an advertisement as mentioned above, clearly identifying the product and its price, should be seen as an invitation to purchase pursuant Article 2(i) UCPD (para 25). This means that it should contain all the material information necessary for consumers to make transactional decisions, provided, however, that there is space to present such information considering the medium used to give it to consumers, pursuant to Article 7(1) UCPD and previous CJEU's case Ving Sverige (paras 26-27). The CJEU confirms in this case that in the sharing economy sphere, where an online sales platform offers many products on sale by different traders and this is advertised in a print medium, there may be limitations of space within the meaning of Article 7(3) UCPD (para 29). In such a case thus, it may suffice for the online sales platform to refer to the website on which the material information will be provided to consumers, rather than to place this information already in the print advertisement (para 30). However, it is for the national court to determine whether the context of the invitation to purchase and the means of communication used for the advertisement justified this delay in providing material information to consumers. The CJEU confirms, however, the obligation of the online sales platform to provide information to consumers on the name and address of the supplier of individual products (para 31). Finally, the online sales platform needs to ensure that the material information on its websites is provided to consumers simply and quickly (para 32). This refers back to the transparency principle, adding a new requirement to the traditional ones, namely of 'quick' provision of information to consumers.


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