In developing e-commerce regulation, the European Union (EU) has adopted a number of directives to improve the regulation of transactions and online commerce in digital goods and services, including Directive 2019/770, Directive 2019/771 and the “Omnibus Directive”.
Amendments to the Consumer Rights Protection Law (CRPL) and related regulations of the Cabinet of Ministers, which will set new requirements for agreements on the supply of digital content or digital services, and to the Unfair Commercial Practices Prohibition Law (UCPPL) which will set new requirements for online commerce are expected to be adopted and enter into force in 2022,. In its turn, certain norms of directives have already been adopted in such regulatory enactments as the Cabinet Regulations No. 178 “Procedure for Indicating the Prices of Goods and Services”.
The main changes included in the amendments are described below. As the amendments are not yet final, the provisions contained therein are subject to change during the legislative process.
Ensuring transparency and fairness on online marketplaces
The amendments stipulate that consumers should have easy access to general information on the main parameters of how the goods or services searched for are ranked (displayed) on a website. Among other things, it must be indicated it must be indicated whether goods or services from sellers that have paid or given other benefits to the online marketplace are more visible when searching for goods on the website.
New obligations for online marketplaces to inform the customers
As it is possible to buy goods online both from businesses and from individuals, providers of online marketplaces will now have to inform consumers that the seller is not a legal person and that consumer protection laws will not apply to the transaction.
Online marketplaces will also need to inform the consumers whether the provider of the online marketplace or the merchant using the online marketplace is responsible for delivering the goods and exercising the right of withdrawal.
Data as a form of payment
The new rules requires that consumer rights should be ensured through the provision of digital services such as applications, clouds and social networks, for which consumers do not make a payment but provide their data as an equivalent means of payment.
New types of misleading commercial practices
Fake consumer feedback
The merchant shall not provide false or misleading consumer feedback or recommendations. In turn, the provider of an online marketplace must take reasonable steps to ensure that the feedback displayed has been provided from consumers who have actually used the goods or services in question.
Resale of tickets
It is planned to include a norm in the law that the resale of event tickets to consumers will be considered a misleading commercial practice if they were purchased by automated means, circumventing the established restrictions on the number of tickets that a person may purchase or other rules applicable to the purchase of tickets.
A commercial practice shall also be regarded as misleading if, if goods sold in one member state are shown to have significant differences in their composition or characteristics compared to apparently identical goods sold in other member states. The aim is to ensure that consumers are not misled and that seemingly identical goods are indeed identical in quality, regardless of the country in which the product is purchased.
Consequences in the case of non-compliance
The amendments to the UCPPL provide for a change in the penalties for unfair commercial practices by removing the EUR 100,000 limit for a fine; however, they maintain the current approach that the supervisory authority is entitled to impose a fine of up to 10% of turnover for unfair commercial practices. In cases where it is not possible to obtain information on the turnover of a commercial practice, it is possible to impose a fine of up to EUR 2 million.
DIGITAL CONTENT AND SERVICES
Amendments to the CRPL provide that digital content and services will be separated from goods that have digital elements. The applicable requirements vary depending on the distinction.
The amendments introduce new requirements for the supply, proper integration and modification of digital content or digital services, as well as rules on the right of withdrawal when purchasing such content or services.
- The seller or service provider must ensure that the consumer is provided with the updates necessary to maintain the compliance of the digital content or service for a specified period of time.
- The new rules give the seller or service provider the right to modify the digital content beyond what is necessary to maintain the digital content or digital service accordingly: for example, to implement updates of the mobile application. However, such modification must comply with legal requirements: such an option must be provided for in the agreement with the consumer and the consumer must be clearly and understandably informed of the modification.
- The two-year period of liability on the part of the seller or service provider for any lack of conformity existing on the date of delivery is extended to the supply of digital content or services.
A consumer to whom a non-compliant digital content or digital service has been supplied has the right to require the seller or service provider to remedy the non-conformity of the digital content or digital service, reduce the price proportionately, or cancel the agreement and reimburse the consumer for the digital content or digital services.
New requirements for price indication
In order to prevent artificial price increases before sale, clearer rules have been laid down for how the seller must notify the consumer of price reductions. Namely, the initial (basic) price, defined as the lowest price during a period of not less than 30 days before the price reduction was applied, must be indicated.
New term for burden of proof
The term during which the seller is required to prove that the lack of conformity did not exist at the time of delivery if a claim is submitted from a consumer has been extended from six months to one year.
The amendments replace the concept of “guarantee” with “commercial guarantee”. The reason for this is a confusion between different concepts. Namely, in practice, it has been observed that when a consumer purchases a product, it is indicated that the product has a two-year guarantee, which is in fact not a guarantee but a right under the law for consumers to request for compliance of the good with the agreement to be ensured. The guarantee is, in turn, an additional promise to perform any activity in accordance with the characteristics specified by the commercial guarantee or characteristics specified by the advertisement which is available at the time of concluding the agreement or before concluding the agreement. In addition to the statutory right of claim, a commercial guarantee for a product may be obtained if it is offered by the manufacturer, seller or service provider.
Conclusions and suggestions
- The changes will bring along a number of new obligations for merchants and rights to consumers.
- If you sell your goods or services to consumers, make sure that your advertising and the information provided complies with the new regulations.
- Revise your existing sales agreements, general terms and conditions, and the process for concluding agreements.
- For marketplace operators and merchants that sell goods and/or services online, it is advisable to assure that all notification obligations are being fulfilled.
- Personal data can be considered a form of payment.
- The presumption of a fault in an item at the time of sale will be prolonged from six months to one year in case of consumer sales.
- Amendments to UCPPL provide for a change in the calculation of fines for unfair commercial practices, by removing the EUR 100,000 limit for a fine. However, the content of the amendments may change during the legislative process.
 European Parliament and Council Directive (EU) 2019/770 On Certain Aspects Concerning Contracts for the Supply of Digital Content and Digital Services.
 European Parliament and Council Directive (EU) 2019/771 On Certain Aspects Concerning Contracts for the Sale of Goods, Amending Regulation (EU) 2017/2394 and Directive 2009/22/EC and Repealing Directive 1999/44/EC Transposition of Requirements into National Law.
 European Parliament and Council Directive (EU) 2019/2161 Amending Council Directive 93/13/EEK and European Parliament and Council Directive 98/6/EK, 2005/29/EK and 2011/83/EU as Regards the Better Enforcement and Modernisation of Union Consumer Protection Rules. Available at: https://ec.europa.eu/info/law/law-topic/consumer-protection-law/review-eu-consumer-law-new-deal-consumers_lv
 Draft law No. 1179/Lp13 “Amendments to the Law on Consumer Protection”. On 16 December 2021, the Saeima has yet to carry out the third reading and consider the amendments to the CRPL on the second reading, implementing the above-mentioned EU directives for regulating the digital market and strengthening consumer protection. The Saeima has yet to consider the amendments on the third reading.
 Draft law VSS-639 “Amendments to the Unfair Commercial Practices Prohibition Law”. Available at: http://tap.mk.gov.lv/lv/mk/tap/?pid=40505108
 Amendments to the Cabinet Regulations No. 178 “Procedure for Indicating the Prices of Goods and Services”. Available at: https://likumi.lv/ta/id/328529-grozijumi-ministru-kabineta-1999-gada-18-maija-noteikumos-nr-178-kartiba-kada-noradamas-precu-un-pakalpojumu-cenas-