E-Commerce Marketplaces – Identifying Your Third-Party Sellers
If you operate an e-commerce marketplace in the European Union (EU) you must provide certain pre-contractual mandatory information about the third-party sellers (sellers) on your e-commerce platform to consumers.
Even where your marketplace acts as a mere intermediary, i.e. you don’t sell on your marketplace and you don’t provide services to sellers, you must ensure that the consumer is properly informed about the identity of the actual sellers offering products on your marketplace before the conclusion of the contract.
1. Identity of the sellers: you need to provide the consumer with the identity of the seller on the basis of the information provided by the seller itself. This should include, at least, the name of the seller and her/his contact details, phone number and email address. If you don’t provide this information you run the risk of creating an impression that the marketplace is the seller which may make it liable for the obligations of the seller.
2. Sellers status: based on the information provided by the seller, you must also inform the consumer whether the seller is a trader (business or professional seller) or non-trader (amateur seller not selling in the course of business). The recently updated EU Consumer Rights Directive suggests that this identification should be done on the basis of a self-declaration by the seller. You may need to change your registration process so that this information about the seller is collected, or updated, where applicable. In any event, the status information should be made available to the consumer in a prominent, clear and accessible manner before the conclusion of the contract, preferably along with the seller’s contact details.
3. Information about consumer protection: as well you must warn the consumer of the consequences of this seller classification. Notably, where the seller is not a trader, you must inform your customers that consumer protection law does not apply to the contract. For example there is no right of withdrawal i.e. consumers can’t change their mind and return the product for any reason within 14 days and get a full refund. This information should be visible and easily accessible, not “hidden” only in the general sales terms.
4. Communication channel: you must provide a way for the consumer to contact the seller and provide for an online communication channel between the seller and consumer, for example an on-line chat or contact email. The consumer should have the ability to keep a record of the communication with the seller through this channel.
5. Shared responsibility: you must also let consumers know how the obligations related to the contract are shared between the seller and you when applicable. For example responsibility for delivery or dealing with complaints. This information depends on the contract you have with your sellers, and applies only where there are shared responsibilities in place.
It is important for the marketplace to provide the above information on their website and e-commerce selling channels. Failure to do so may now expose the marketplace operator to stiff fines up to 4% of the marketplace’s annual turnover in the EU member state(s) in cases of serious non-compliance or unfair commercial practices.