Online platforms become quasi-regulators

By Rutger Oldenhuis LLM

The rapid growth of e-commerce has transformed the way we shop, allowing us to purchase a wide range of products conveniently from online marketplaces. However, this convenience also brings certain risks, particularly when it comes to product safety. Too often, we see products sold through online platforms that do not comply with relevant EU product legislation. It is not uncommon to find products subject to recalls still being available on online marketplaces. The enforcement of product safety regulations on online marketplaces has traditionally posed challenges for authorities. However, this situation is anticipated to undergo a significant transformation with the implementation of the upcoming EU General Product Safety Regulation (GPSR). An entirely new section has been included with obligations for ‘providers of online platforms’. This seems to be a real game-changer, not only for providers of online platforms but also for companies who sell products through online platforms. Under the GPSR, online platforms will be obligated to implement a comprehensive set of due diligence measures. These measures will ensure that both the platforms themselves and the traders utilising their platforms adhere strictly to relevant laws and regulations when selling products. To get the gist, here’s an overview of the upcoming requirements:

Online marketplaces are required to establish a single point of contact for communication with market surveillance authorities in Member States and consumers regarding product safety issues. This contact will also be registered with the Safety Gate Portal, a new web portal to inform the public and enable them to submit complaints.
Online marketplaces must set up robust internal processes for ensuring product safety.
Online marketplaces are expected to remove dangerous product content from their platforms within two working days following an order from market surveillance authorities.
Providers are required to monitor information about dangerous products via the Safety Gate Portal and take appropriate actions, if needed. They must also report any voluntary measures taken to the authority that made the notification.
Online marketplaces must process product safety notices within three working days from receipt.
Platforms must organise their online interface such that it enables sellers to provide comprehensive information about their products and make it easily accessible to consumers. This includes information about the manufacturer, product identification details, and safety information.
Online marketplaces should have mechanisms that enable traders to provide the necessary information and a self-certification declaring their compliance with the regulation.
Providers of online marketplaces must suspend services to traders that frequently offer non-compliant products after issuing a prior warning.
Platforms are expected to cooperate with market surveillance authorities, traders, and other relevant parties to eliminate risks presented by products offered online.
Providers must inform consumers in a timely manner about product safety recalls and publish this information on their online interfaces.
The regulation also imposes obligations on providers to cooperate with market surveillance authorities by sharing data about dangerous products, accidents, and product recalls.

Including a bulleted list in a blog may not win the beauty contest, but I hope it clarifies the message that the forthcoming GPSR makes online platform providers quasi-regulators when it comes to product compliance and safety. A clever move if you compare the surveillance capacity of national authorities with the financial resources of Amazon and the like. The message for traders using platforms is really: be prepared. The GPSR will enter into force on 13 December 2024. And yes, that’s a Friday…