Start of new year under the sign of Omnibus Directive - eCommerce news #no. 36

Are e-consumers being safe while making online transactions? How do the decisions of the President of the Polish Office of Competition and Consumer Protection affect the formation of competition in the industry? And finally - what changes for eCommerce have been brought by the newly implemented regulations implementing the Omnibus Directive into Polish law? Answers to these questions await you in the first edition of this year's Advox Press Release. Stay tuned to the news right from the start, as there are many indications that 2023 will be full of surprising news from the world of eCommerce! Ready for new challenges?

How do the Omnibus Directive regulations affect eCommerce operations?

The beginning of 2023 proved to be full of challenges for the eCommerce industry. From January 1st, acts implementing the provisions of the Omnibus Directive into the Polish legal order came into force. For this reason, owners of sales platforms have had to make changes to their eCommerce sites both in terms of adapting their platforms' interfaces to the newly applicable requirements and reformulating their business regulations.

What areas in particular are affected by the regulations?

• Informing about price changes of products under promotion - when a promotion is announced, eCommerce owners are required to present the lowest price of the product from the period of 30 days from the discount introduction, in addition to the current price.
• Product positioning - from now on, entrepreneurs should inform about the main parameters on the basis of which the display order of search results is determined.
• Price profiling - a similar regulation also applies to pricing based on individual customer characteristics (such as location, age or browsing history). The user must be clearly informed about the use of measures towards him/her to adjust the offer individually.
• Verification of reviews - the publication of reviews should be accompanied by information on whether the rating issued has been verified and whether it comes from a person who actually purchased the product. If the opinion meets these conditions - the site should also include precise guidelines related to how to verify it. Omission of the above steps will be considered as an unfair practice that misleads consumers.

The purpose of the Omnibus Directive is to adjust consumer protection to rapidly changing economic reality, including technological progress. The beginning of the year in the industry will certainly be marked by adapting to the new regulations and learning how they apply in practice. We can assure you that we will keep an eye on how the market reacts to the changes, so that we can inform you all about it in future issues of the Press Release!

You can read more about the impact of EU regulations on eCommerce operations here. Does your online store meet the requirements dictated by the new regulations?

President of the Office of Competition and Consumer Protection vs. unfair eCommerce practices

Protecting competition and consumer rights is essential for the proper functioning of the economy, and thus eCommerce - at the end of 2022, the President of the Polish Office of Competition and Consumer Protection imposed 2 sanctions totaling 210 million zlotys for violating competition and weakening the position of buyers. The decisions were aimed at marketplace Allegro. What exactly do they concern?

After accepting complaints from sellers operating inside the platform, and as a result of its own observations culminating in an antitrust investigation, the authority confirmed that the company was taking unauthorized advantage of its position in the market. Allegro, in order to improve the positioning of products from the brand's official store offer, used information unavailable to others regarding the functioning of the site and its algorithms. Independent sellers were not able to use this knowledge, which negatively affected the effectiveness of their sales.

The second decision, in turn, concerns the situation of consumers using the Allegro Smart! solution, which allows, among other things, free delivery of orders. According to the President of the Office of Competition and Consumer Protection, the provisions contained in the terms of service limit the rights of buyers. This is because the company reserved the possibility of modifying the terms of the agreement depending on technological changes and economic and market conditions. If the above situations arise, there would be a risk of one-sided changes in the provisions without precisely specifying their circumstances - it would be impossible for the customer to foresee such a situation at the time of entering into the agreement.

The decisions issued are an example of how abuse of a dominant position can affect the market. However, in analyzing the above situation, it is worth noting that simply having a larger market share is not forbidden. Only the use of this advantage for the purpose of gaining an advantage is the subject of prohibition.

You can read more about the ruling here. How do you assess the current level of competition in the eCommerce industry?

Poles' safety during e-shopping - Santander report

In 2022, as many as 33,000 internet domains were added to the list of alerts containing addresses of dangerous websites by CERT Polska, which is an increase of as much as 250% compared to the previous year. The results of Santander's study titled: "Polaków Portfel Własny”: Bezpieczni na e-zakupach 2022" show that 9% of respondents have fallen victim to fraud while shopping online. Most often, fake e-shops offered goods from the following categories: clothing and footwear (52%), drugs and dietary supplements (15%) and electronics (15%).

What are the most common methods of cybercriminals?

• Phishing, which is the impersonation of individuals or institutions (e.g., banks or courier companies) to defraud sensitive data
• Creating fake sales campaigns on marketplace portals to obtain phone numbers or payment card codes
• Asking for order payment outside the store's website
• Sending messages (e.g., as part of a newsletter) containing suspicious links

Customers take a number of actions to avoid scams themselves. To do this, they most often analyze other buyers' reviews and compare product prices. In addition, more than 30% pay attention to the terms of returns and complaints of goods. Despite this, eCommerce consumers are still a group especially vulnerable to scam attempts, while being one of the most important links in eCommerce security. Providing them with a sense of security is therefore crucial to the stable operation of individual online stores and the industry as a whole. Achieving this state is certainly facilitated by taking educational efforts in the field of cyber security and keeping abreast of dangerous situations in the market.

Is your online store responsive to your customers' security needs? Reading full raport may be helpful in answering this question.