E-Commerce Regulations Published!
On July 7, 2022, significant changes were introduced to the Law on the Regulation of Electronic Commerce with the law published in the Official Gazette. With this legislative amendment, new obligations were imposed on sellers conducting sales on the internet and online marketplaces. Especially when considering the changes made for online marketplaces, it can be said that this legislation will reshape the e-commerce market.
With the Regulation on Electronic Commerce Intermediary Service Providers and Electronic Commerce Service Providers published in the Official Gazette on December 29, 2022 (“E-Commerce Regulation” or “Regulation”), the procedures and principles of the changes introduced by the Law were detailed. We briefly summarize the new obligations that concern not only online marketplaces but also all parties engaged in online sales below.
1- Seller’s Information Obligation
All sellers conducting sales through their websites on the internet must have complete information, which can be directly accessed under the “contact” heading on the homepage of their website, including their trade name, MERSIS number, and headquarters address; for traders and craftsmen, their name and surname, tax identification number, headquarters address, KEP address, email address, phone number, and registered brand, if applicable.
Sellers on online marketplaces are also required to include their trade name, KEP address, tax identification number, or MERSIS number in the space provided for them. In addition, some information must also be reported to online marketplaces.
Online marketplaces must verify the identifying information of sellers from publicly accessible electronic systems of relevant institutions or, if this is not possible, from the documents they obtain. If verification is not performed, intermediary services should not be provided.
2- Transaction Guide
Online marketplaces and sellers conducting sales on their own websites are obliged to prepare a transaction guide that can be accessed from the homepage. This guide should include information such as order stages, the storage period of the contract, technical tools that can be used by the consumer in case of incorrect data entry before confirming the order, and alternative dispute resolution mechanisms.
3- Obligations Related to Orders
Online marketplaces and sellers conducting sales on their own websites must provide a separate category for second-hand goods to be sold, ensure that the consumer can clearly see the total price to be paid and other terms of the contract during the order, and provide technical tools necessary for the consumer to identify and correct errors in data entry before confirming the order. In addition, online marketplaces and sellers conducting sales on their own websites must inform the consumer of the order through the website where the transaction was made and at least one other communication channel.
4- Unlawful Content and Infringement of Intellectual and Industrial Property Rights
As mentioned in the law, online marketplaces are not responsible for illegal content provided by sellers. However, online marketplaces are obliged to remove the content within 48 hours after becoming aware of illegal content.
Regarding intellectual and industrial property rights on online marketplaces, a new regulation has been introduced. According to the Regulation, intellectual and industrial property rights holders will apply to online marketplaces through the internal communication system, notary, or KEP. Various information and documents must be included in the application. Online marketplaces must take action within 48 hours regarding these applications.
Sellers whose products are removed due to the complaint mentioned above can also object to this application. Sellers must provide evidence that the product removed from the market does not violate the intellectual and industrial property rights of the complainant, such as documents showing that the product is original, invoices or equivalent documents suitable for proving that the product is authentic, contracts, other documents, and evidence showing the persons who have introduced the product into the market with the permission of the intellectual and industrial property right holder, if any.
If the complaint is found to be valid, the product will be made available for sale again, and if the intellectual and industrial property rights holder does not provide new documents, new applications related to this matter will not be considered by online marketplaces.
5- Unfair Commercial Practices in Electronic Commerce
It is emphasized in the Law and Regulation that online marketplaces are prohibited from engaging in unfair commercial practices that significantly disrupt the commercial activities of sellers, reduce their ability to make informed decisions, or compel them to make a certain decision. Various examples of these practices are provided. For example, forcing sellers to sell discounted goods or services, making retroactive or unilateral changes in intermediary contract provisions, and reducing the seller’s ranking or recommendation system in the absence of any objective criteria in the intermediary contract.
6- Sale of Branded Products by Online Marketplaces
Online marketplaces, regardless of who produced them, cannot offer for sale or act as intermediaries for the sale of goods bearing the brand of themselves or the persons they are economically linked to or having the right to use the brand. Online marketplaces have been given until January 1, 2024, to comply with this rule.
7- Data Sharing
Online marketplaces are obliged to provide the necessary means for sellers to carry certain data effectively and free of charge. This data includes sales and return data, characteristics, descriptions, and visuals of products offered for sale; information such as questions, answers, and evaluations related to these products, data on the most preferred products based on periods, special days, categories, and product bases, gender, age group, city and district distribution of buyers, and purchase day and time data, and evaluation score regarding the performance of the ETHS.
This data, carried by the sellers, is published by indicating the name or brand of the online marketplace where the source data was first created. It should be noted that the relevant marketplace is obliged to make the performance evaluation score comply with the five-point scale, even if it has a different rating system in its own system, and include a comma and two decimal places after the whole number in the five-point scale.
This provision will come into effect on January 1, 2024.
8- Electronic Commerce License
Online marketplaces with a net transaction volume of over ten billion Turkish liras in a calendar year and a transaction count of over one hundred thousand, excluding cancellations and returns, and sellers of medium, large, and very large scale that generate more than half of their total sales revenue from electronic commerce sales must obtain a license from the Ministry to continue their activities and renew their licenses. All internet players must check the thresholds specified in the Law and Regulation. Obtaining a license will be possible by paying quite high fees.
9- Other Provisions
As stated in the Law, very large-scale online marketplaces will not be able to engage in the transportation of goods and postal services other than the sales they make on their own website. Likewise, these marketplaces will not be able to allow the publication of advertisements for goods or services on the same platform that enables the conclusion of contracts or the placement of orders for the purchase of goods or services.
For large and very large-scale online marketplaces, limitations have been introduced on advertising and discount budget based on various mechanisms. How these limitations will affect the e-commerce market is a matter of curiosity.
CONCLUSION
- Following the Law change that significantly affected the electronic commerce market, the Regulation detailing the procedures and principles of these changes was published in the Official Gazette on 29.12.2022.
- The Regulation explains the new obligations imposed on all sellers operating on the internet in detail. Both companies selling on their own websites and sellers on online marketplaces are required to comply with this Regulation.
- Sellers are obligated to provide various information specified in the Regulation on their website, create a transaction guide, and provide the necessary technical tools for orders.
- A new mechanism has been introduced concerning intellectual and industrial property rights violations on online marketplaces.
- Starting from January 1, 2024, sellers on online marketplaces will be able to transfer all their information and consumer reviews/ratings received to other platforms.
- Unfair commercial practices of online marketplaces have been banned. These platforms will no longer be able to sell their products starting from January 1, 2024.
- Online marketplaces or sellers selling through their websites exceeding the thresholds specified in the Law are obliged to obtain a license.