General conditions of contract in national and international online sales. What if the Vienna Convention applies?
The regulation of general terms and conditions in e-commerce involves not a few insignificant complexities.
If on the one hand it seems easy enough from a practical point of view to ensure that the general terms and conditions of sale are knowable by means of certain expedients, it is certainly more complex and less easy to ensure that vexatious clauses are expressly approved in writing in accordance with the dictates of the second paragraph of Art. 1341 of the Civil Code.
The notion of general terms and conditions of contract ("GTC") is included in our legal system in Art. 1341 of the Civil Code. General Terms and Conditions of Contract are to be understood as a set of contractual clauses, which are by their nature generalitiesas they are intended to apply to all contracts of a given series, and of one-sidednessas they are only prepared by a contractor, the so-called predisponent.
The formula general terms and conditions thus expresses the practical phenomenon of the prior and unilateral formulation of a uniform negotiating content intended to be used to regulate an indefinite series of relationships belonging to the predisposer.[1]
1) When are they valid?
Art. 1341 of the Civil Code lays down, in relation to the content of general terms and conditions, two different requirements of effectiveness. It provides, in para. (1), for the general requirement of effectiveness of knowledge or cognizability and, in para. (2), for the particular requirement of effectiveness of specific approval in writing in the case of so-called vexatious or so-called onerous clauses.
1.1. Knowability and knowledge.
Knowability consists in the possibility for the adherent to acquire knowledge through the use of ordinary diligence. Therefore, for all contracts that are concluded by means of uniform contractual terms and conditions prepared by the contracting party, the favourable principle dictated by the first paragraph of Art. 1341 of the Civil Code applies, according to which the actual content of such clauses is enforceable against the other contracting party even if the latter, without having knowledge of them, should nevertheless have known them by using ordinary diligence.[2]
This, however, presupposes an activity on the part of the predisposing party that is appropriate to permit knowledge, taking into account the diligence that is normal to expect of the average adherent with reference to the type of economic transaction performed.[3]
1.2. Written proof and unfair terms.
Para. (2) regulates the specific situation in which the terms themselves are vexatious and provides that they, in order to be binding on the other contracting party, must be approved particularly in writing, in the knowledge that an objectively onerous obligation is being undertaken.[4] The list of unfair terms (which is exhaustive and not subject to extensive interpretation)[5] is specifically concerned with:
- limitations of liability (Art. 1229);
- power to withdraw from the contract (Art. 1373) or to suspend its performance (Art. 1461), or impose forfeitures on the other contracting party (Art. 2965);
- limitations on the right to raise objections (Art. 1462);
- Restrictions on freedom of contract in relations with third parties (arts. 1379, 1566, 2596), tacit extension or renewal of the contract (arts. 1597, 1899), arbitration clauses (art. 808 of the Code of Civil Procedure) or exceptions to the jurisdiction of the courts (arts. 1370; 6, 28, 29, 30, 413 of the Code of Civil Procedure).
Since one of the characteristics of the GTC is their unilateral nature, the need for written approval of unfair terms is excluded whenever the conclusion of the contract was preceded by a negotiation which specifically addressed the terms that would otherwise require an independent signature, whereas the signature remains indispensable for terms with vexatious content to which the party has adhered without any discussion.[6]
As to the manner of approval, it is generally held that there is no need for a specific signature for each vexatious term and that the requirement of specific approval in writing is also fulfilled in the case of numerical references to terms provided that they are accompanied by an indication, albeit summary, of their content.[7]
2) 1341 of the Civil Code and electronic commerce.
Applying the principles summarised above to the electronic marketplace entails not a few insignificant complexities: in particular, the double signature of vexatious clauses in telematic contracts is a very complex problem that has been debated both in doctrine and in jurisprudence.
If in a sale onlineOn the one hand, it seems quite easily solvable from a practical point of view to ensure the cognizability under Art. 1341 para. 1 of the Civil Code of the general terms and conditions of the contract by means of certain expedients (e.g. the insertion of link on the site or within the order, which refer to the GTC), it is certainly more complex and less straightforward to ensure that vexatious clauses are expressly approved in writing in accordance with the dictates of the second paragraph of the aforementioned article.
The solution that is normally adopted on e-commerce is to set up two form separate, one of which is intended for the approval of the general terms and conditions as a whole (by ticking a box and accepting with a "click"so-called "click-wrapping") and one of the vexatious clauses, which are then separately accepted (albeit by means of a "click").
Jurisprudence has had several occasions to pronounce on whether acceptance by click complies with the formal requirements imposed by Art. 1341(2) of the Civil Code, recording for the time being quite opposing positions.
There is a ruling by the Justice of the Peace of Trapani stating that:
"checking a box by clicking cannot be equated with the double signature requirement of Art. 1341 of the Civil Code, since it cannot be equated with the signature of the contracting party who has not prepared the text of the agreement."[8]
This guidance echoed a somewhat less recent decision of the Court of Catanzaro in 2012,[9] in which the plaintiff had complained of the vexatious nature of the clause contained in the terms of use of the principal's (eBay's) website, which allowed the company to suspend or delete at any time, even without justification, theaccount with which the seller could use the platform.
The Court had upheld the application, finding the abusive nature of the clause and noting that eBay had not set up a valid double acceptance mechanism pursuant to Art. 1341(2) of the Civil Code, through specific approval of the adherent of the GTC by means of digital signaturesince only the latter would have guaranteed the actual acceptance of the provision and the identifiability of the subscriber.
In the writer's opinion, given that the text of Art. 1341(2) of the Civil Code does not require the specific signing of the unfair terms, but rather their approval, the digital signature should not be considered a necessary element to ensure the fulfilment of this requirement, but rather to overcome a different (and further) obstacle, i.e. relating to the proof of the traceability of the signing of an electronic contract to a well-identified person.[11]
To this end, given that such 'identification' can also be carried out in a more streamlined manner and more in line with the business needs of both parties, it could be considered that the validity of the acceptance of the general terms and conditions by click and their traceability to a particular party could be more 'strengthened' if this is collected, for instance, following a login with insertion of user name e password by the member.[12]
It should be noted, however, that more recently, in 2018, the Court of Naples, in a similar case (still concerning eBay's terms of use), instead adopted a very different orientation, considering it unnecessary to introduce the requirement of a digital signature to accept the vexatious clauses, since this solution would have led to:
"transforming all telematic contracts into binding form contracts as a matter of pretext, requiring for their conclusion the use of a sophisticated instrument, not yet massively widespread among the public, and thus effectively paralysing the development at national level of an entire sector of trade that is becoming increasingly important at planetary level".
Again in this sense, we read in a decision of the Justice of the Peace of Partanna,[10] which had held that the requirement of written form under Article 1341(2) of the Civil Code was sufficient through
"a double assent, by pressing the appropriate button: one of adhesion and the other of approval of the so-called vexatious clauses."
3) 1341 Civil Code and international trade
3.1. Waiver of Jurisdiction.
After having, albeit very briefly, analysed the main issues concerning the limits of the usability of the GTC in the context of e-commerce, we go on to examine the possibility of waiving jurisdiction in favour of the judicial authority of a Member State by simply inserting an extension clause in the general terms and conditions, to be submitted to the adherent for acceptance by a simple click.
Article 23 of the Regulation Brussels I bisprovides that the agreement conferring jurisdiction must be concluded:
- "In writing or orally with written confirmation,
- or in a form permitted by the practices established between the parties, or
- in international trade, in a form permitted by a usage which the parties knew or ought to have known [...].
- The written form includes any electronic communication that allows for a durable record of the clause conferring jurisdiction"
The European Court of Justice[13] was asked to answer whether the click-through procedure, by which a buyer has access to the general terms and conditions of sale appearing on an internet site by clicking on a hyperlink opening a window, fulfils the requirements of Article 23(2) of the Brussels I Regulation.
The case concerned a car dealer established in Germany who, after having purchased on the defendant's (a Belgian-based company's) website, sued the seller in the German court of Krefeld. The seller entered an appearance arguing that the German courts did not have jurisdiction, since Article 7 of the GTC contained a clause conferring jurisdiction in favour of the court in Leuven (Belgium).
The European Court of Justice confirmed the jurisdiction of the Leuven court, holding that the procedure of acceptance by clicking on the general terms and conditions of a contract of sale concluded electronically, which contain a clause derogating from jurisdiction, constitutes an acceptance in writing of those terms and conditions, since they are electronic communications that do not open automatically upon registration on the website, can be saved or printed before the conclusion of the contract and therefore constitutes an electronic communication within the meaning of Article 23(2) of the Regulation.
This issue was also recently submitted to the United Sections of the Supreme Court,[14] which have held that an extension of jurisdiction clause (pursuant to Article 23 of the Regulation) is valid even if it is contained in the general terms and conditions of a contract, expressly referred to in the purchase order signed by the customer and accessible from the web address referred to therein, and that prior to the conclusion of the contract, the text of those terms and conditions can be printed and saved.
The waiver of jurisdiction, therefore, does not require the specific written approval of the adherent, pursuant to Article 1341(2) of the Civil Code, since it does not fall within the vexatious clauses exhaustively listed therein. It should be noted that, according to a well-established jurisprudential orientation,[16] Article 1341 of the Civil Code dictates a criterion of jurisdiction and that this does not affect the different criteria of jurisdiction applicable to international disputes. The United Sections themselves[15] have recently pronounced themselves on this point, stating that:
"The requirement of written form, prescribed by Art. 23 of the Regulation [...], is fulfilled if the clause itself appears in the general terms and conditions of the contract, if the contractual document signed by both parties contains an express reference to the aforesaid general terms and conditions bearing that clause, without the need for a specific approval in writing pursuant to Art. 1341 of the Civil Code.
3.2. General Terms and Conditions and the Vienna Convention.
In the event that the general terms and conditions of the contract regulate international purchase and sale relations, the Vienna Convention (if any) is applicable,[17] the question arises whether or not the double signature requirement of Article 1341 of the Civil Code can be invoked.
Indeed, the Vienna Convention, like any other uniform contract law convention, does not regulate all questions that may arise in connection with the contracts it regulates; this is of no little importance if one considers that the questions that are not regulated will have to be resolved on the basis of the law applicable to the contractual relationship.[18]
On the contrary, all matters that are expressly regulated by the Convention will prevail over the rules of domestic law, which will be derogated from by it; in order to understand whether Art. 1341 of the Civil Code can be invoked in such a case, it is essential to understand whether or not the GTC are governed by such rules of uniform law.
According to more authoritative doctrine,[19] although the general terms and conditions of contract are not expressly regulated by the Vienna Convention, since in Part II thereof the "formation of the contract" is exhaustively regulated. it will be necessary to refer to the rules of the Vienna Convention in order to understand what formal requirements the GTC must comply with.
On the assumption that Article 11 of the Vienna Convention establishes the principle of the freedom of formpart of the doctrine[20] and case law[21] therefore held that in the event of the application of the Convention, the requirement under Article 1341 of the Civil Code that any vexatious clause drafted by one of the contracting parties be subject to specific written approval must be regarded as waived.
Following this principle and applying it to online sales, it can therefore be considered that, in the event of the application of the Vienna Convention, unfair terms included in general terms and conditions would not require specific approval, and could therefore also be accepted by 'click'; it would still be the duty of the originator (pursuant to Art. 9) to ensure that the adherent has been put in a position to become aware of them, by means of a 'proactive' attitude by virtue of a general obligation of good faith and commercial cooperation.[22]
[1] Bianca, Civil Law, Giuffrè, Third Edition, p. 340.
[2] Court Milan 18.6.2009.
[3] Bianca, The General Conditions of Contract, 1979, p. 2.
[4] Cass. civ. 2003, no. 1833.
[5] Cass. Civ. 2013, no. 14038.
[6] Cass. civ. 2020, no. 8268.
[7] Trib. Rimini, 4.4.2020; Cass. Civ. 2018, no. 17939.
[8] Giudice di pace Trapani, 14.10.2019, with note by Quarta La conclusione del contratto di albergo per via telematica: pagamento anticipato e revoca della prenotazione, Danno e responsabilità, 2020, 2; Giudice di pace Milano 28.01.2019, Tribunale di Catanzaro 30.4.2012, in Res. Civ. e prev., 2013, 2015 ff.
[9] Trib. Catanzaro 30.4.2012, in Contratti, 2013, 1, 41, with a note by V. Pandolfini, Contratto on line e clausole vessatorie: quale firma (elettronica)?
[10] Justice of the Peace Partanna 1.2.2002.
[11] The Court of Catanzaro itself argues that the contract is invalid because only the digital signature would have guaranteed the actual acceptance of the provision and the identifiability of the signatory.
[12] On this subject, see also Cerdonio Chiaramonte, Specific written approval of unfair contract terms, NGCC, No. 3, 2018.
[13] Court of Justice of the European Union, 21.5.2015, No. 322/14.
[14] Cass. Civ. Sec. Un. 2017, no. 21622.
[15] Cass. Civ. Sec. Un. 2020, no. 1871.
[16] On this point see Cass. Civ. Sec. Un. 1982, no. 6190, Cass. Civ. 2003, no. 17209, Cass. Civ. 2010, no. 14703.
[17] Article 1 of the Convention that it "shall apply to contracts of sale of goods between parties having their place of business in different States: a ) where those States are Contracting States; or b ) where the rules of private international law refer to the application of the law of a Contracting State."
[18] According to Italian case-law, issues relating to e.g. representation and prescription are not governed by the Convention (Trib. Padua 25.2.2004; Trib. Vigevano 12.7.2000).
[19] Ferrari, International Sale of Goods,
[20] Bortolotti F. ''Handbook of International Commercial Law'' vol. II L.E.G.O. Spa, 2010; Ferrari F. ''General Terms and Conditions of Contract in Contracts for the International Sale of Goods'' in Obb. e Contr., 2007, 4, 308; Bonell M.J. ''Le condizioni generali in uso nel commercio internazionale e la loro valutazione sul piano transnazionale'' in ''Le condizioni generali di contratto'' edited by Bianca M., Milan, 1981).
[21] Trib. Rovereto 24.8.2006; Cass. Civ. 16.5.2007, no. 11226.
[22] On this subject, Ferrari, General Terms and Conditions in Contracts for the International Sale of Goods, Obbligazioni e contratti, 2007, 308.
Agency agreement and online sales: exclusive, non-competition and indirect commissions.
If a manufacturer chooses to sell online via its own e-commerce, it will certainly have to reckon with the reactions of its agents, likewise if the manufacturer sells to wholesalers or distributors who decide to put the purchased products online. Not to mention if this strategy is implemented by some agent who decides to start promoting sales with the help of the web.
This article will analyse what legal impacts online sales have on the 'traditional' sales network, examined from three points of view, that of the manufacturer, the third party and the agent.
1. Online sales by the manufacturer and impacts on sales agents.
Before analysing what are the legal repercussions in the event of a decision to put contractual products online, the following question should be answered: can the manufacturer sell in the areas where its agents operate?
To answer this question, one has to take a few steps back and understand how the principal may actually operate within the area granted to the exclusive agent.
- Read also: Area exclusivity in the agency contract.
Exclusivity is governed by Art. 1743 of the Civil Code, which prohibits the principal, unless otherwise agreed, from using the services of other agents within the territory. According to settled case law, this clause, which constitutes a natural element of the contract, ((Civil Cass. 2012 n. 16432; Civil Cass. 2002 n. 5920; Civil Cass. 1994 n. 2634; Civil Cass. 1992 n. 5083.)) does not only bind the principal not to appoint more than one agent within the same territory, but is also intended to protect the agent from any interference by the principal within the area, including the conclusion of business within the territory itself.((Cass. Civ. 2004 No. 14667.))
On the other hand, the regulation also provides that the agent is entitled to commissions even on business concluded by the principal directly with customers '.belonging to the reserved area or category or group of customers"(Art. 1748(2) of the Civil Code); this provision would seem to confer on the principal a 'free mandate' to sell directly within the territory, on the sole condition that he pays the agent the so-called indirect commissions.
Italian jurisprudence has arrived at a compromise that takes into account the opposing interests of the parties, as governed by the above-mentioned rules, holding that the freedom of the principal must be limited to the exercise of occasional sales within the territory, as it must be excluded that the principal may carry out systematic and organised sales there sales activities. ((One reads, for example, in a recent Supreme Court ruling that: "in matters of agency relationships, the principal may not operate, on a continuous basis, in the agent's area of competence but, pursuant to Article 1748(2) of the Civil Code, is only entitled to conclude, directly, individual deals, even if of significant size, the performance of which gives rise to the agent's right to receive so-called indirect commissions. It follows that, where the proponent's intervention is merely isolated, the right to payment of the commission is, in turn, episodic and not periodic in nature, and, as such, is subject to the ordinary limitation period under Art. 2946 of the Civil Code and not to the 'short' limitation period under Art. 2948(4) of the Civil Code. (Cass. Civ. 2008, no. 15069); see also Cass. Civ. 2009 no. 8948, Cass. Civ. 1993 no. 5591; on this subject cf. Bortolotti, Distribution Contracts, 2016, Walters Kluver.))
Following this orientation, if the contract does not expressly recognise the principal's right to make direct sales (even in a structured manner) within the exclusive territory, the principal who decides to set up a sales strategy through channels online subject itself to the risk of being challenged by its agents, for breach of exclusivity, especially if the trade via web generates a substantial amount of sales.((See Cass. Civ. 2009 no. 8948 where it was "ruled out the existence of just cause for the agent's termination without notice from the agency relationship on the sole basis of the principal's failure to pay the small commissions on only nine contracts concluded directly and of a marginal total amount."))
Very interesting is the cue promoted by a part of the doctrine, ((Baldi - Venezia, Giuffrè Editore, pg. 73 et seq.)) (which probably considers the orientation of the jurisprudence referred to above as too aleatory and not in line with the literary normative dictate of Art. 1748, para. 2 of the Civil Code) on the basis of which the principal should only be prohibited from carrying out an actual promotional activity, instead deeming lawful the answering of questions from customers who spontaneously address the principal, thus extending also to this hypothesis the distinction between active and passive sales of antitrust law.
2. Online sales within the exclusive agent's territory through third-party distributors.
A somewhat different problem is to understand when sales by third parties within the agent's territory may constitute a breach of exclusivity.
As analysed above, unless otherwise agreed, the exclusive agent is entitled to formerly Art. 1748(2) of the Civil Code to commissions also on all sales that the principal makes within its territory; it is therefore common ground that if the principal makes sales to a wholesaler based in the contract territory, the agent may claim the right to payment of indirect commissions. In order to understand whether the customer (legal entity) may be considered to be within the territory, it is appropriate to refer to a fairly old judgment of the Court of Justice, ((Judgment Kotogeorgas v Kartonpak of 12.12.1996, Case C-104/95.)) more recently confirmed by the Court of Cassation,((Cass. Civ. 2012 no. 5670.)) which clarified that any legal entity having its head office in the territory in which the agent enjoys exclusivity belongs to the zone.
It is less clear and obvious whether this third party, once it has purchased products from the principal, makes sales online directly to customers in the agent's reserved area, the agent may claim the right to commission from the principal.
Also responding to this question was a more recent ruling of the European Court of Justice:
"Article 7(2), first indent, of the Council Directive 86/653/EEC of 18 December 1986on the coordination of the laws of the Member States relating to self-employed commercial agents, must be interpreted as meaning that a commercial agent entrusted with a specific geographical area is not entitled to commission for transactions concluded by clients in that area with a third party without the direct or indirect intervention of the principal."It follows that there will only be a breach of exclusivity and the agent will only be entitled to an indirect commission if there has been direct or indirect intervention by the principal in sales made in the territory by third parties, ((Cass. civ. 2017 No. 2288.)) with the aim of de facto depriving the agent of business that the latter could have concluded.((See the principle established by the Court of Cassation sez. Lav. in judgment 2011 no. 11197.))
3. Online sales by commercial agents.
In contrast to distribution contracts, in agency contracts the principal may prevent the agent from carrying out online sales promotion activities (unless the agent, due to the manner in which he or she carries out his or her activities, is to be regarded as subject to antitrust law).
- Read also: Can a manufacturer prevent its distributors from selling online?
The question then arises, is the agent free to decide to start promoting online sales?
In fact, should an agent decide to do so, he or she will run afoul of what is the typical prerogative of the webi.e. that it is by its very nature visible everywhere and that any limitation aimed at preventing unjustified geographical blocks would even be contrary to European law.
- Read also: Geoblocking: what is it and when does it apply?
On the other hand, as already explained at the beginning of this article, the agency relationship provides as a natural element of the contract the obligation of exclusivity to which the parties are bound and which any breach entails contractual offences. In particular, if the agent makes out-of-area sales, it will be in breach of the exclusivity covenant vis-à-vis the principal, since in such a case it will not be able to claim any commission being reserved exclusively for the agent of the area where it made the sale.
If, on the other hand, the contract provides for such out-of-area sales, the exclusive agent where the sale was made may bring an action against the principal for breach of the agreements between them.
Placing these principles in the online market, the question that arises is whether the mere existence of a website where sales of contractual products are offered (which by its nature is also visible outside the agent's assigned area) should be considered as a sales promotion activity that infringes the exclusivity of other agents.
To date, there appear to be no case law precedents that have answered this question, and in order to find a (at least plausible) solution, it is necessary to go back over the general principles on the subject of agency, recalling the principles dictated by antitrust law, taking into account the peculiarities of the market online.
Based on the Orientations of the Commission, the mere existence of an Internet site must in principle be regarded as a form of passive selling. Indeed, it reads:
"If a customer visits the Internet site of a distributor and contacts him, and if that contact results in a sale, including actual delivery, this is considered a passive sale. The same applies if a customer decides to be informed (automatically) by the distributor and this results in a sale."((LGC No. 52.))
Otherwise, it must be considered an active sale:
"Online advertising specifically targeted at certain customers [...]. Banners showing a territorial link on third party websites [...] and, in general, efforts made to be found specifically in a certain territory or by a certain group of customers".((LGC No. 52.))
It would therefore be consistent with antitrust law and European competition law to hold that the agent's breach of exclusivity only arises in the case of 'active' sales promotion activities, since otherwise it would have to be held that the mere answering of questions from customers outside the area, who spontaneously approach the agent, would only result in the agent's commission not being recognised.
In view of what would in any case be the impact on the sales network of the establishment of an online distribution system, it is advisable to consider very carefully regulating contractual relations in a manner consistent and aligned with the actual distribution strategies to be implemented.
The legal nature of online platforms: the Uber and Airbnb cases
With the Airbnb and Uber judgments, the Court of Justice ruled on the legal qualification of two very important online platforms. In this article, we are going to understand to what extent an online platform can be qualified as an 'information society' and when not.
One of the founding principles of the EU internal market is the free movement of goods and services. As we have already discussed some of the problems that the European legislator has had to deal with in trying to find a balance between the principle of free trade in goods and the interest of producers in creating competitive distribution networks (The mixed system: when the manufacturer chooses to adopt both exclusive and selective distribution), this article intends to focus attention on how the principle of free movement of services coordinate with the operation of platforms onlinewhich increasingly characterise the economic fabric of the internal market.
To do so, one must probably start from the origins of European law, which, with the introduction of the internal market (Art. 26 of the TFUE), aimed at guaranteeing any entity operating in a Member State to carry out an economic activity in another Member State (Art. 54 - Freedom of establishment) and offer its services there (Art. 56 - Services)[1].
With the 2006/123/EC[2] (relative
services in the internal market) Europe wanted to strengthen the principle of the
freedom to provide services[3], considering
that the pursuit of this objective "aims to establish increasingly
between the states and peoples of Europe and to ensure economic progress
and social"[4]as well as
to eliminate "barriers in the internal market [that] prevent the
providers, in particular small and medium-sized enterprises, to expand beyond the
national borders and make full use of the single market. "[5]
To understand whether the services offered by the platforms online, who increasingly play the role of intermediaries with the end user, fall under the definition of 'services" referred to in Article 56 TFEU and Article 4 of Directive 2006/123 and are therefore addressees of the protections guaranteed by those rules, it is first necessary to give a definition of 'platform online". Indeed, if one searches within the European legislation, the only definition provided to us is that of "online brokerage"referred to in Article 2 of Regulation 2019/1150[6]this rule qualifies this activity as that performed by "information society services', pursuant to Article 1(1)(b) of the directive 2015/1535[7]which in turn is taken from Article 2(a) of the Directive 2000/31[8] on e-commerce.
It is therefore at the term 'information society service" that one must resort to in order to begin to give legal status to such entities; it is qualified (by the above-mentioned directives) as any service "normally provided for remuneration, at a distance[9]electronically[10] and at the individual request of a recipient of services."
The EU after having defined, albeit generically, the concept of information societywith Directive 2000/31 considered it appropriate to ensure that the free market for services is also ensured for entities operating online and, in order to induce Member States to remove restrictions on the cross-border movement of services rendered by the information societyArticle 2 stipulated that Member States may not adopt measures restricting this exercise unless they are necessary for reasons of public policy, public health, public security or consumer protection (Art. 3).
Furthermore, it provided that the Member State must (subject to nullity of the measure)[11] having previously notified the Commission and the Member State in whose territory the service provider in question is established of its intention to take the restrictive measures in question (Article 3(b), second indent).
It follows from this that it is of paramount importance to understand whether a platform online may or may not be qualified as information societysince only in the latter case will the person enjoy the above-mentioned specific protections recognised by European law on the free movement of services.
On this point, it should be noted that the Court of Justice was recently asked about this very issue, in relation to the mediation services provided by the digital platforms Uber Spain, Uber France and Airbnb Ireland. We will now briefly analyse these rulings in order to try to understand what is the ratio which led the Court to take opposite decisions on (apparently) very similar situations.
1. The Uber Spain and Uber France cases.
With two 'twin' decisions, Uber Spain of 20.12.2017[12] and Uber France of 10.4.2018[13]the Court of Justice was called upon to decide whether the UberPop service, which is provided via an international platform, should be assessed as transport service and in that case subject to national legislation making the carrying out of that activity conditional on the hauliers obtaining a licence, or a service of the information societywith the consequent requirement of prior approval by the Commission of national regulatory measures prohibiting such activity.
The European Court of Justice in its first analysis acknowledged that:
"an intermediary service enabling the transmission, by means of a smartphone application, of information relating to the booking of a transport service between the passenger and the non-professional driver, who, using his own vehicle, will carry out the transport, meets, in principle, the criteria to be qualified as an 'information society service'."[14]
In any case, the
Court continues its reasoning by analysing in a
detailed what brokerage services actually are
provided through the use of the Uber application, noting that the company did not
is limited merely to putting in contact (and thus mediating) the
carrier and the transported, but also:
- select non-professional drivers
using their own vehicle and with the help of theapp of Uber,
provide a transport service to persons intending to make a
movement in the urban area, which otherwise they could not have resorted
to these services; - fixed if nothing else the price
maximum running; - receives payment of the customer and subsequently
pays it to its driver; - exercises control on the quality of
vehicles and their drivers and their behaviour; - in some cases may exercise against
their drivers exclusion from service.
The Court, having analysed the report in its entirety, therefore came to the conclusion that:
"the brokerage service in
discussion [must] be considered as an integral part of a service
total of which the main element was a transport service, and
therefore fulfilling the qualification of 'information society service' not
[...] but to the service aspect of 'transport quality'.Pursuant to
Article 2(2)(d) of Directive 2006/123'.[15]
In view of this
legal classification of the service provided by Uber, the Court held
legitimate regulatory measures that the Spanish and French states had
enacted to prohibit and repress the exercise of this activity, taking into account
that transport services are explicitly excluded from the scope of
implementation of directive 2006/123[16] (and therefore
neither subject to the obligation to inform the Commission under Article 3
of Directive 2000/31).
2. The caso Airbnb of 21.12.2019
The same procedure
argumentation was followed by the Court in a similar case,[17] where one
found itself engaged in deciding on the legal framework of the
intermediation service provided by Airbnb Ireland through the
its electronic platform, with which they are put in contact, behind
remuneration, potential tenants with landlords, professional or otherwise, who
offer short-term accommodation services.
The issue had arisen because the French Association for Accommodation and Professional Tourism (AHTOP) had filed a complaint against Airbnb Ireland, complaining that the Irish-registered company was carrying out a real estate mediation activity on French territory, which is subject under domestic law (Law Houget) to a licensing obligation.
Airbnb Ireland, denying that it was acting as a real estate agent, entered an appearance claiming the right to freedom of establishment and arguing that the law was inapplicable to it Houget because of its incompatibility with Directive 2000/31, claiming to operate in French territory only as information society.
The Court, echoing what was decided in the previous Uber rulings, again affirmed the principle of law that in order to be able to recognise the legal nature of information societyit is not enough that they are only if the four conditions are met cumulative as referred to in Article 1(1)(b) of the aforementioned Directive 2015/1535, but it is also necessary to verify whether it appears that:
"said
mediation service is an integral part of an overall service the
which main element is a service to which a different
legal qualification".
The Court held that the services provided by the platform related to presenting offers in a coordinated manner, with the addition of tools for searching, locating and comparing them, constitutes themain element of the service and cannot therefore be considered merely ancillary to a service to which the different legal guise of provision of accommodation must be applied.[18] In contrast, all these services (analysed in detail in recital 19 of the judgment)[19] represent the real added value of the electronic platform that allows it to stand out from its competitors.[20]
Following this reasoning, the Court held that Airbnb Ireland cannot be classified as a real estate agentThe purpose of its activity is not only to rent accommodation, but to provide an instrument facilitating the conclusion of contracts concerning future transactions. It is stated on this point that:
"a service such as that provided by the
Airbnb Ireland is not at all indispensable to the realisation of
accommodation services from the point of view of both tenants and landlords
who have recourse to it, since both have numerous other channels [...].
The mere fact that Airbnb Ireland enters into direct competition with
the latter channelsproviding its users, i.e. both landlords and
to tenants, an innovative service based on the particularities of a business
information society business does not allow us to derive from this
the indispensable character for the provision of a service of
accommodation."
Given the legal nature of Airbnb Ireland's information societythe Court declared that it was not subject to the licensing requirement imposed by French law (Loi Houget), as restricting the free movement of services, also noting that this regulatory measure had in any event not been notified to the Commission in accordance with Article 3 of Directive 2000/31.
Very interestingly, the Court came to a different decision to the Uber case, recognising the nature of information society serviceon the assumption that Airbnb Ireland does not exert a decisive influence on the conditions of the provision of accommodation services to which its mediation service relates, taking into account that the same neither directly nor indirectly determines prices of lettings, nor does it carry out the selection of landlords or accommodation offered for rent on its platform.[21]
From the study of the two judgments, it can therefore be seen that it is the independence and the failure to control on the entity using the electronic platform to promote its service, a central element in understanding whether the platform online whether or not it provides an intermediary service, which can be classified as service of information society and that this must be assessed by analysing the relationship in its entirety.
The above rulings are certainly of great significance not only from a legal point of view, as they lay the foundations for framing figures who increasingly occupy a fundamental role in our economic and social fabric.
[1] Art. 56
TFRUE "Within the framework of the following provisions, restrictions on the free
provision of services within the Union are prohibited in respect of the
nationals of Member States established in a Member State other than the one
of the recipient of the service. "
[2] Directive
2006/123/EC of the European Parliament and of the Council of 12 December 2006,
on services in the internal market.
[3] This directive
defines in Art. 4(1) as "service' means any activity
unpaid economic activity referred to in Article 50 of the Treaty provided normally
against remuneration. "
[4] Id.
Recital 1.
[5] Id.
Recital 2.
[6]
Regulation of 20 June 2019, promoting fairness and transparency for the
commercial users of online brokering services, effective as of
from 12.7.2020.
[7]
Directive that repealed and replaced the previous directive
98/34/ECwhich defined services
[8]
Directive 2000/31/EC of the European Parliament on certain legal aspects
of information society services, in particular trade
electronic commerce in the internal market ('e-commerce directive')
[9] La
directive definesremotely"a service provided without the
simultaneous presence of the parties.
[10] La
directive defines: "electronically": a service sent originally
and received at destination by means of electronic processing equipment
(including digital compression) and data storage, and that it is
entirely transmitted, forwarded and received by wire, radio, optical means
or other electromagnetic means.
[11] Cf.
on the point Judgment
of 19.12.2019 Airbnb Irland UC vs. Association pour un hébergemen et un
tourisme professionnels (AHTOP).
[12] Judgment
of 20 December 2017, Associación Profesional Elite Taxi vs. Uber Systems
SpainSL,
[13] Judgment
of 10 April 2018, Uber France s.a.s.
[14] Id. 19
[15] Id. 40.
[16] Cf.
Art. 2(2)(d) Directive 2006/123
[17] Judgment
of 19.12.2019 Airbnb Ireland UC vs. Association pour un hébergemen et un
tourisme professionnels.
[18] Judgment
of 19.12.2019 Airbnb Irland UC vs. Association pour un hébergemen et un
tourisme professionnels (AHTOP), No. 54
[19] Id. In
recital 19 lists in an analytical manner the services actually offered by
Airbnb that are "In addition to the service of connecting
landlords and tenants via its electronic centralisation platform
of the offers, Airbnb Ireland proposes a number of other
services, such as a scheme defining the content of their offer, in
option, a photography service, likewise as an option, insurance for
liability as well as a guarantee for damages up to an amount of
to EUR 800 000. In addition, it provides them with a service
optional to estimate the price of their rental in the light of the averages of
market from that platform. Moreover, if a lessor accepts a
lessee, the latter transfers to Airbnb Payments UK the price of the
lease to which must be added an amount, ranging from 6% to 12% of said
amount, by way of fees and service charged to Airbnb Ireland.
Airbnb Payments UK holds the funds on behalf of the lessor after which, 24
hours after the tenant enters the accommodation, it transmits them to the landlord
by bank transfer, thus enabling the tenant to be sure of the existence
of the asset and to the lessor the guarantee of payment. Finally, Airbnb Ireland has
established a system whereby the lessor and the lessee can
make a judgement by means of a grade ranging from zero to five stars, grade
available on the electronic platform in question. "
[20] Id. 64
[21] Id. 68
Selling online abroad: applicable law, geoblocking and antitrust law.
The purpose of this article is to provide the reader with ideas for structuring an online sales strategy aimed at foreign markets, taking into account the EU regulations on geoblockingregulations of the countries to which one intends to export and, last but not least, antitrust law.
1. Geoblocking: what is it and when does it apply?
Firstly, one must
analysing the recent European discipline, introduced with Reg.
28 February 2018, No 302/2018in force since 3 September 2018, containing
measures to prevent unjustified geographical blockades (also known as
as "geoblocking").
The geoblocking was introduced by the EU with
to ensure that it is also correctly applied to the market
one of the founding principles of the European Union: free movement
of goods.
The new Regulation, si
therefore proposes to prevent unjustified geographical blockades or other forms of
discrimination based, directly or indirectly, on nationality, place
of residence or establishment of customers.
Article 3 of that regulation states
in fact that:
"A professional [i.e. an entrepreneur/company].
cannot block or restrict through the use of technological tools or
otherwise, a customer's access to its online interface for
reasons related to nationality, place of residence or place of establishment
of the customer."
This article continues:
"A professional
cannot for nationality reasonsplace of residence, or to the
place of establishment of a customer, redirect that client to a version
of its online interface other than the one the customer wanted
log in initiallybecause of the structure of the language used or of
other features that make it specifically intended for customers with
a particular nationality, place of residence or place of establishment, a
unless the customer has explicitly consented thereto. "
From a concrete point of view, the
Rules prohibits the practice whereby a user is prevented, to
French example, to buy a product on an Italian site, as it is redirected
automatically to another site designated to handle French customers.
Warning, this does not mean
intends that the professional may not use different versions of its
interface onlinein order to address customers from
Different Member States[1]
(e.g. the German language version, for the German market, the
French for France, etc.), but requires that the different versions designed for the
different markets, be accessible from all EU countries (a
French, you can see the Italian site and the conditions of sale there).
On this point, Art. 3(2),
point 2 of the Regulation makes it clear that:
"in case of redirection with the explicit
consent of the client, the practitioner's version of the online interface
which the customer initially wished to access must remain easily accessible
to the customer in question."
As a result, the professional will not only be free to use different versions of their interface online to address customers from different Member States, but also to automatically redirect the customer to a certain version of the interface if the user has given his or her explicit consent[2] and provided that the user is still free to access all other versions of the same interface.
2. Does geoblocking mean that I have to sell everywhere?
One point must be clarified: the new Regulation
clears the block, but does not oblige you to sell outside your country.
The geoblocking does not limit the possibility of deciding
to market their products online in certain countries, but prohibits
that if the site only provides for delivery to certain countries (for
simplify, in Italy), the customer from another EU country (Germany) is prevented
to buy online that product if you accept delivery in Italy.[3]
Furthermore, if marketing is envisaged
price differentiation is allowed in several countries to take into account, for example,
of the different costs to be incurred for the delivery of the goods, as long as the choice
does not take place in a discriminatory manner.
In fact, Art. 4(1) of the Regulation
provides that the geoblocking:
"does not prevent traders from offering general terms and conditions, including net selling prices, that differ between or within Member States and that are offered to customers in a specific territory or to specific groups of customers on non-discriminatory basis. "
3. Who do I sell to?
Given that the proposal of
sale entered online on its website implies that it is visible
by all users of the network, in the absence of clarification, it is
would apply the general rule that if the professional directs
its sales activity in a given foreign country, implicitly makes
assume that the sale is also aimed at customers domiciled in that particular
Country.
It follows that if the site is
translated into German it is implied that the sale is directed against Germany,
Austria, Lichtenstein and Luxembourg, as well as if it is translated into English, that the
same is promoted to (almost) the whole world.
Although the choice of 'maximum
opening' may seem very commercially viable, we invite you to evaluate it
prudently, as it has considerable legal repercussions (mainly
related to the law applicable to individual sales contracts and the
violation of any foreign rules), tax (in particular with
reference to the transaction being subject to VAT in the purchaser's country of domicile)
and customs (in the case of non-EU sales).
Therefore, for the avoidance of doubt, once you have assessed which countries you actually intend to sell to, it is advisable to state this directly on the site and in the general terms and conditions of sale.
4. By what law is the sale regulated?
If sales are only aimed at
to a market (e.g., to simplify, Italy), with delivery of the goods
in the territory of that country and the purchaser is a consumer domiciled in a different
country (e.g. Germany), which requires the delivery of the goods to take place in
Italy, such a sale will be governed by Italian law, without the need to worry about
to provide in the general terms and conditions of sale for compliance with any regulations
imperative provided by Germany. [4]
A different matter, however, if the order originates in Germany and the delivery of the goods takes place on German territory, in which case the law applicable to the contract of sale will be German law and, if the end user is a consumer, this may not be derogated from, even with the written consent of the parties.[5]
5. Violation of information obligations and foreign regulations.
If the site provides for the sale
also in countries other than Italy, it will be necessary to organise it by ensuring
that:
- the general sales conditions respect the obligations of
consumer information, as referred to in Art. 6, para. 1 of the Directive
2011/83/EU;[6] - the general terms and conditions of sale comply with any mandatory regulations
of the countries to which they intend to export, different and/or additional to those
provided for by Italian law; - commercial information required by the
State of export.
With reference to the above
disclosure obligations, it should be noted that:
- the restriction on delivery of the goods must be clearly stated
since the beginning of theprocedure leading to the conclusion of the contract, formerly Art. 8(3) of the
Directive 2011/83/EU;[7] - must be in the language of the consumer (Art. 8 para. 1 of the Directive
provides for the obligation to 'inform the consumer in plain and intelligible language').[8]
The penalty in case of
breach of consumer information obligations consists in the extension of
of the right of withdrawal from fourteen days to twelve months and fourteen
days.[9]
In addition to the risk of such a sanction, in some European countries there is also the risk of being subject to a warning and, in the most serious cases, an injunction action before the competent court: German law, for example, provides that in the case of ineffective clauses in the general terms and conditions of sale and violation of consumer protection rules, the warning and/or injunction action may be brought not only by the consumer, but even by a competitor, i.e. a consumer protection association.[10]
6. Can distributors and retailers sell online?
In the event that the manufacturer also makes use of third-party distributors and resellers to market its products, it is worth briefly recalling what are the powers of control over these entities, referring, for further details, to the section antitrust of this blog.
The Vertical Sales Regulation 330/2010 and recent judgments of the European Court of Justice[11] provided that a manufacturer may not prohibit its distributor/reseller from sell purchased products through their own websitenor market through the digital platforms of third parties.
The only way to limit this possibility by third parties is (for high-end, luxury and technically developed products) to create a selective distribution networkin which the distributors and resellers undertake to sell the contract goods only to distributors selected on the basis of objective criteria of a qualitative nature established indiscriminately and non-discriminatorily for all persons belonging to the network.
In that case, according to the most recent case law of the Court of Justice,[12]a manufacturer is authorised to impose a clause on its distributor allowing it to sell products via internet, but on condition that such sales activity online is realised through an 'electronic shop window' of the authorised shop and that the aura of luxury and exclusivity of these products is thereby preserved (on this point, see the Amazon Case e The mixed system: when the manufacturer chooses to adopt both exclusive and selective distribution).
[1] Compare recital 20
of the Regulation on geoblocking.
[2] Consent, once given, may be considered valid
even for subsequent visits by the same customer to the same interface
online, provided that the customer is given the opportunity to revoke it when he or she considers
appropriate. On this point, see recital 20 of the Geoblocking Regulation.
[3] On this point, see Stefano
Dindo, E-Wine, Legal-economic aspects of wine communication and distribution
online, G. Giappichelli Editore, p. 41, 2018.
[4] According to Art. 6(1),
(a) and (b) of Regulation 593/2008.
[5] See previous footnote.
[6] Directive 2011/83/EU of
european parliament and the council of 25 october 2011 on the rights of
consumers. Importantly, since this is a Directive (and not a Regulation), the
it must be transposed by national laws, while leaving the
Member countries free to choose the most appropriate regulatory path to achieve the
objectives set therein; it follows that each country is free to insert
information obligations in addition to those set out in the directive itself.
[7] Art. 3 Directive 2011/83/EU:
"E-commerce sites shall indicate clearly and legibly, at the most
late at the beginning of the ordering process, if restrictions apply
delivery and which means of payment are accepted."
[8] Attention! These parameters
language must also be complied with for the application of the provisions
of the GDPR. On this point, see Recital 20 of that Regulation.
[9] Art. 10 para. 1 of Directive 2011/83.
[10] Cf. Robert Budde, E-Wine,
Legal-economic aspects of online wine communication and distribution, G.
Giappichelli Editore, p. 51 ff., 2018.
[11] See judgment of the Court of
Justice in the Pierre Fabre case C-439/09.
[12] Judgment of 6 December 2017, C-230/16 Coty Germany GmbH.
Can a manufacturer prevent its distributors from selling online?
When is it possible to block the online sales of distributors or members of one's own sales network? Active sales, passive sales, geoblocking... Let's have some clarity!
L'e-commerce is undoubtedly a tool with extraordinary potential: it makes it possible to address a very wide range of users, to target offers with great precision at well-defined customer categories, and for the end consumer, let's not forget, it is undoubtedly convenient!
In view of its potential, this tool must be used with great awareness by any entity wishing to operate in the e-commerce sector; a strategy must be carefully worked out marketingIt is necessary to take into account the logistical complexities involved and to comply with increasingly complex and binding regulatory requirements (think only of the privacycertainly made more complex following the entry into force of the GDPR).
Furthermore, given the transversality of the webthe use of e-commerce contributes significantly to making the increasingly transparent prices and this not infrequently clashes with the manufacturer's distribution strategies, often aimed at protecting the brand and creating a pricing policy that is as controlled as possible.
1. The European Commission's analysis of the impacts of e-commerce.
The European Commission recently carried out an investigation into the trade impacts that thee-commerce has on the market and consumers, concluded with the drafting of the "final report on the e-commerce sector enquiry."[1] Here are some insights into the conclusions reached by the Commission:
[Through e-commerce, price transparency has] increased [and] consumers are [...] able to immediately obtain and compare product and price information online and quickly switch from one channel (online/offline) to another."[2]
[...]
The ability to compare product prices between different online retailers leads to increased price competition for both online and offline sales[3] and alternative online distribution models, such as online marketplaces, have enabled retailers to reach customers more easily [...] with limited investment and effort."[4]
This analysis paints a very effective picture of the reality of sales online, leading increasingly to one:
- greater transparency on prices;
- easier to reach a very large customer base, even beyond the territorial limits possibly imposed by the distributor.
2. Can the manufacturer block the online sales of its distributors? Regulation 330/2010.
Aware of these risks, the manufacturer, in order to defend its strategy, often decides to impose limits on its distributors' use of this medium, prohibiting them from selling online (sometimes also requiring distributors to apply the same restriction to their buyers), or preventing them from selling online outside the territory assigned to them (on this subject see also The mixed system: when the manufacturer chooses to adopt both exclusive and selective distribution).
At this point, the question arises: can the manufacturer prevent its distributor from selling online?
To answer this question, one must start with theArticle 101(3) of the Treaty on the Functioning of the EU (TFEU). This rule ban agreements and concerted practices of enterprises "which have as their object or effect the prevention, restriction or distortion of competition within the common market"This prohibition includes agreements that prevent the distributor from selling to customers domiciled outside the territory.[5]
In any case, European legislation derives specific exceptions which are fixed in the Regulation No 330/2010 concerning the so-called '.vertical agreements', i.e. agreements for the distribution and supply of goods or services concluded between undertakings each operating at a different level of the production or distribution chain. This regulation must be interpreted and supplemented in the light of the Commission Guidelines (LGC), published on 20 April 2010, which, among other things, expand on the topic of restrictions on e-commerce.
The European legislation referred to above prohibits theArticle 4 of the Regulation agreements that prevent the distributor from selling to customers domiciled outside the territory. In any event, in order to prevent a manufacturer from dividing its network of distributors into different territories, it allows restrictions only on the so-called '.active sales"[6] in the exclusive territory or to the exclusive customer base of the supplier, while not allowing the so-called '.passive sales. "[7]
As for the online salesthe Guidelines (point 52) specify that they are generally to be regarded as "passive", with the consequence that, in principle, no distributor may be prevented from using internet to sell their products. In particular, it is made express prohibition to negotiate agreements whereby the distributor agrees to:
- redirecting consumers to the site internet of the manufacturer or other distributors with territorial exclusivity;
- interrupting transactions online of consumers following the ascertainment of their geographical area of residence through their credit card data;
- limit the proportion of total sales made via internet;
- pay a higher price for products intended for resale online compared to those for traditional outlets (para. 52 LGC).
It is therefore not possible to prevent a distributor or retailer from setting up its own site for sales onlinelet alone use digital platforms (e.g. Amazon, E-bay, Alibaba, etc.) for marketing.[8] The manufacturer can find its products online, supplied by the distributor or by the shop itself supplied by the distributor, without being able to prevent this process, let alone control it (on this topic see also article "Exclusivity clauses and vertical economic agreements in the European context: e-commerce and territorial exclusivity"by colleague Vittorio Zattra).
The distributor, by the way, will not be obliged to accept all orders from customers outside its territory: in order to avoid the risk that foreign customers might assume that the offer is directed at them, for the sole reason that they have visibility of the offer on their device, it is advisable to indicate directly on the site that the offer does not concern sales involving the delivery of goods abroad. This clause is also in line with the new regulation 302/2018 on the CD. geoblockingon measures to prevent unjustified geographical blockades and other forms of discrimination based on the nationality, place of residence or place of establishment of customers within the internal market.
This regulation (mentioned here only briefly), aims to prevent unjustified geographic blockades or other forms of discrimination based directly or indirectly on the nationality, place of residence or establishment of customers: the regulation in fact removes the blockade, but does not oblige customers to sell outside their own country or to have the same prices for the whole of Europe.[9]
3. Court of Justice rulings on online sales.
3.1. The Pierre Fabre Case.
However, the Court of Justice in the case Pierre Fabre C-439/09 decided that the absolute ban on the use of internet imposed by a manufacturer on a distributor, constitutes a restriction that is not in line with the provisions of Regulation 330/2010, provided that the manufacturer demonstrates that this prohibition does not is objectively justified.
One (other) question arises: when is such a restriction justifiable and to what extent?
3.2. The Coty Germany GmbH case.
The Court in its recent judgment of 6 December 2017, C-230/16 Coty Germany GmbH clarified that in a system of selective distribution[10] of luxury products, a manufacturer (in this case Coty) is authorised to impose a clause on its distributor allowing it to sell the products via internet, but on condition that such sales activity online is realised through an 'electronic shop window' of the authorised shop and that it is thus preserved the luxurious connotation of the products.
In that case, the Court decided that a clause preventing the dealer not so much from using internet to sell/promote the goods purchased from the manufacturer, but to market them through digital platforms such as Amazon and the like. This is because the quality of the products:
"results not only from their material characteristics, but also from the style and image of prestige that gives them an aura of luxury, because such an aura constitutes an essential element of these products in order for them to be distinguished by consumers from other similar products."
In conclusion, it can be said that the manufacturer/supplier, once it has authorised a distributor to handle its goods, may not prevent the latter from using e-commerce to sell them also beyond the pre-established boundaries, invading the exclusive territory reserved for other distributors, provided that the end customer's request can be considered as spontaneous and not specifically solicited by the distributor.
There is also the possibility for the supplier to impose, in any case, on its distributors certain quality standards for the presentation of products, or specific sales methods consistent with its distribution system, provided that these conditions do not directly affect the quantity of goods marketable via internet or on the prices practicable on that platform.
_____________________________________
[1] Report from the Commission to the Council and the European Parliament, Final Report on the E-Commerce Sector Inquiry, 10.5.2017.
[2] Id. No. 11
[3] Id. No. 12
[4] Id. No. 14
[5] On this point See Bortolotti, Distribution Contracts, Wolters Kluwers, 2016, p. 746 ff.
[6] The LGCs, paragraph 51, define active sales as: "active contact with individual customers, e.g. by mail, including by sending unsolicited e-mails, or by visits to customers; or active contact with a specific group of customers, or with customers located in a specific territory through advertisements in the media or via the Internet or other promotions specifically addressed to that group of customers or to customers in that territory.
Advertising or promotions that are only attractive to the buyer if they (also) reach a specific group of customers or customers in a specific territory are considered active sales to that group of customers or customers in that territory. "
[7] The LGCs, paragraph 51, define passive sales as: "the response to unsolicited orders from individual customers, including the delivery of goods or the provision of services to such customers. Passive sales are advertising or promotions of a general nature that reach customers within the (exclusive) territories or customer groups of other distributors, but which are a reasonable way to reach customers outside those territories or customer groups, for instance to reach customers within one's own territory.
General advertising or promotions are considered a reasonable way to reach these customers if it is attractive for the buyer to make such investments even if they do not reach customers within the (exclusive) territory or (exclusive) customer group of other distributors'..
[8] On this point see Stefano Dindo, E-Wine, Legal-economic aspects of wine communication and distribution online, G. Giappichelli Editore, p. 47, 2018.
[9] On this point see Stefano Dindo, E-Wine, Legal-economic aspects of wine communication and distribution online, G. Giappichelli Editore, p. 41, 2018.
[10] There is no definition of selective distribution, however the Metro judgement, Court of Justice, 25.9.1977, already indicates the criteria for its identification: a) the products must be products whose quality or technological content require a selective distribution system, which safeguards their quality and correct use; b) the choice of distributors is made according to objective criteria of a qualitative nature; c) the defined criteria must not go beyond what is necessary.
Exclusivity clauses and vertical economic agreements in the European context: e-commerce and territorial exclusivity
Territorial exclusivity clauses, constituting a pactual limitation on free competition, are subject, in addition to Italian law, to the strict European rules on the subject.
In particular, theArticle 101(3) of the Treaty on the Functioning of the EU (TFEU) sets a general ban concerning all agreements and concerted practices of undertakings "chand may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market".
Among prohibited agreements, this provision mentions in particular those aimed at
- directly or indirectly fix the prices of purchase or sale or other terms of transaction;
- limit or controlling productionoutlets, technical development or investment;
- share markets or sources of supply;
- apply, in trade relations with other contractors, dissimilar conditions for equivalent performance;
- make the conclusion of contracts conditional on the acceptance by the other contracting parties of additional benefitswhich, by their nature or according to commercial usage, have no connection with the subject matter of the contracts.
From this framework, European legislation derives specific exceptions which, as far as we are concerned, are set out in the Regulation No 330/2010 (in force since 1 June 2011 replacing the previous Reg. No 2790/1999) concerning so-called 'vertical agreements', i.e. agreements for the distribution and supply of goods or services concluded between undertakings each operating at a different level of the production or distribution chain.
The regulation, in essence, draws the boundaries within which a distribution agreement between undertakings may be exempted from the general prohibition of restrictive business practices and must be interpreted and supplemented in the light of the Commission's Guidelines (LGC), published on 20 April 2010, which among other things expand on the subject of restrictions on e-commerce.
The Regulation No 330/2010 (in force since 1 June 2011 replacing the previous Reg. No 2790/1999) relating to so-called "vertical agreements", i.e. agreements for the distribution and supply of goods or services concluded between undertakings each operating at a different level of the production or distribution chain, essentially draws the boundaries within which a distribution agreement between undertakings may be exempted from the general prohibition of commercial agreements. It must be interpreted and supplemented in the light of the Commission's Guidelines (LGCs), published on 20 April 2010, which, inter alia, expand on the subject of restrictions on e-commerce.
Regarding specifically the Restrictions to share the market by territory group of customers by guaranteeing the exclusive use of certain distributors, they are only allowed when they restrict
i) so-called 'active sales' (defined below) in the exclusive territory or exclusive customers reserved to the supplier or allocated by the supplier to another buyer, but without imposing any limitation on sales by the buyer's customers;
(ii) sales to end users by wholesalers;
(iii) sales by members of a selective distribution system to unauthorised distributors in the territory that the supplier has reserved for that system; and
(iv) the buyer's ability to sell components, supplied for the purposes of incorporation, to customers who would use those components to manufacture goods similar to those produced by the supplier (Article 4 of the Regulation).
In the case before us, the first of the four cited exceptions, which introduces the distinction between so-called 'active' sales e 'passive'allowing territorial restrictions to be negotiated only with regard to the first of the two categories.
According to the Commission Guidelines, the active' sales designate practices of direct solicitation aimed at a specific territory or group of customers through mailings or the use of targeted advertising and promotions; they are defined as 'passive'on the other hand, sales in response to unsolicited orders from individual customers or the use of general advertising and promotions which constitute a reasonable way to reach customers also outside one's own territory (even in territories entrusted to the exclusivity of other distributors), provided that the customers in one's own territory remain the main and sufficient objective to justify the investment (para. 51 LGC).
As for the online salesthe Guidelines specify that they are generally to be regarded as 'passive', with the consequence that, in principle, no distributor may be prevented from using the Internet to sell its products.
In particular, it is made express prohibition to negotiate agreements whereby the distributor agrees to:
(a) redirect consumers to the website of the manufacturer or other distributors with territorial exclusivity;
(b) interrupt consumers' online transactions as a result of ascertaining their geographical area of residence through their credit card data;
(c) limit the proportion of total sales made via the Internet.
(d) pay a higher price for products intended for resale online than for traditional outlets (para. 52 LGC).
Here are some examples of such as contents can validly form the subject matter of vertical agreements:
- the restriction of practices categorised as 'active sales', including, in particular, the electronic commerce,
- the online advertising specifically targeted at certain customers,
- i banner showing a territorial link to third-party Internet sites online,
- the payment of a fee to a search engine or to an online advertising provider to present advertisements specifically directed at users located in a particular territory
- more generally, any effort made to be found specifically in a given territory or by a particular group of customers (para. 53 LGC);
- the publication on the distributor's website of a series of link to the Internet sites of other distributors and/or the supplier;
- the fixation of an absolute minimum quantity (in value or volume) of products to be sold off-line to ensure the efficient operation of its traditional point of sale. This absolute amount of required off-line sales may be the same for all buyers or may be set individually for each buyer on the basis of objective criteria, such as the size of the buyer in the network or its geographic location;
- the setting a fixed fee (i.e. not a variable fee that increases according to the turnover achieved off-line as this would indirectly represent double charging) to support the buyer's off-line or on-line sales efforts;
- the possibility for the supplier to demand compliance with quality standards in connection with the use of Internet sites for the resale of its goods (as it may do in connection with a point of sale or catalogue sale or advertising and promotional activity in general). As regards selective distribution, the supplier may for instance:
- require its distributors to have several 'non-virtual' points of sale or showrooms as a condition for becoming a member of its distribution system (this must not, however, lead to an indirect restriction of online sales),
- agree with their distributors terms and conditions of use of third-party distribution platformse.g. by preventing access to a distributor's site through another site bearing the name or logo of the third party platform (para. 54 LGC).
In conclusion, it can be said that the manufacturer/supplier, once it has authorised a distributor to handle its goods, may not prevent the latter from using e-commerce to sell them also beyond the pre-established boundaries, invading the exclusive territory reserved for other distributors, provided that the end customer's request can be considered as spontaneous and not specifically solicited by the distributor.
On the other hand, limitations aimed at regulating the possibility of the distributor using e-commerce to carry out promotional activities or direct solicitation within an area exclusively entrusted to other purchasers or reserved to the supplier are permissible.
There is also the possibility for the supplier to impose, in any case, on its distributors certain quality standards for the presentation of the products, or specific sales methods consistent with its own distribution system, provided that these conditions do not directly affect the quantity of goods tradable via the Internet or the prices practicable on that platform.
Defamation on the Internet in Germany and Italy. Comparing legal systems
Some time ago I addressed the issue, now of general interest, of the legal consequences in the case of defamation via the Internet.
I would like to briefly recall that the Court of Livorno recently ruled on this point, giving rise to a new orientation jurisprudential. The Court decided the conviction of a woman for "defamation", with the aggravating circumstance ".print media"for insulting his former employer on his Facebook profile.
On this issue, the Court of German Supreme Courtwhich stated in a recent judgment of 17.12.2013 that a violation of a person's rights through an internet publication has the same value as a press violation.
According to the judges of Karlsruheviolation of a person's right is also considered to be violated if a person puts harmful material on the Internet and that material is then disseminated by third parties.
The comparison of the two rights does not have a purely theoretical value, but a strongly practical one. Consider the example where:
an Italian puts material on the net that infringes the rights of a German citizen resident in Germany. The question arises as to whether the latter has the right to sue the Italian in a German court and request the application of German law to resolve the dispute.
Regarding jurisdiction, i.e. which court is competent to decide on the case, one is reminded of the ruling of the Court of Justice of 25.10.2012 by which it granted the aggrieved party the possibility of bringing an action before the court where it has its centre of interests.
As regards the applicable law, however, the general principle of the Rome II Regulation on the law applicable to non-contractual obligations, which in Article 4 provides that it is applicable the law 'of the country in which the damage occurs irrespective of the country in which the event giving rise to the damage occurred and irrespective of the country or countries in which the indirect consequences of that event occur."
In the present case, therefore, a German citizen whose personal rights have been violated by a publication put online by an Italian citizen, resident in Italy, could potentially sue the latter in Germany, requesting the application of German law.
Software protection. Patentability or copyright?
[:en]How is software protected? Is it patentable? What is copy-right protection?
These questions were answered by the Court of Justice in a landmark judgment of 2.5.2012 (Case C-406/10)with which it interpreted Directive 91/250/EEC.
Specifically, the Court stated that:
- the programming language and file format of data used within this programme are not protected by copyright on programmes;
- he who licences a copy of software may, without the authorisation of the copyright holder, observe, study or experiment with the operation of said programme.
Underlying this decision is a policy adopted by Italy and Europe several years ago, which have chosen the path of the software protection through copyrightonly software that produces a technical effect should be considered patentable.
To briefly understand the difference between the two approaches, suffice it to say:
- copyright is automatically granted to the author under Article 2575 of the Civil Code;
- the granting of a patent (Art. 2585 of the Civil Code), on the other hand, must be explicitly requested from a patent office, carrying out a prior search to verify the originality of one's creation.
European and Italian legislators have opted for copyright protection of software, at the in order to balance the conflicting interests at stakeon the one hand the technological progress and, on the other hand, the software producers.
In this way, the author was granted the possibility of economic exploitation of the intellectual creation and, at the same time, everyone is allowed to enjoy the progress achieved (post the non-patentability of the product) avoiding the creation of stable positions of cultural and technological monopoly.
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The use of CEM in the context of third-party enforcement
[:en]As from 1 January, it is mandatory for the enforcement creditor to indicate the certified mail address in the attachment deed.
Starting from 1 January 2013apply to foreclosures against third parties The amendments to the Code of Civil Procedure introduced by Article 1, Paragraph 20 of Law No. 228 of 24 December 2012 in Official Gazette No. 302 of 29 December 2012.
Specifically, the reform provides that the claimant creditor must indicate the certified mail address(a.k.a. PEC), in the attachment deed (Art. 543 of the Code of Civil Procedure) and, moreover, the indication that the third-party creditor may also make the declaration pursuant to Art. 547 of the Code of Civil Procedure by means of PEC.
It should be recalled, briefly, that already with the amendments adopted by Law 52/2006, the third party was allowed, in cases of non-employment claims, to make the declaration also by registered mail. With the reform, therefore, the third party may decide to make said declaration by certified mail, thus avoiding costs and complications.
It is perhaps worth emphasising that the garnishee third partycalled upon to declare, if in possession of things of the enforceable debtor or if it is owed money by the latter, it does not assume the capacity of a party in the enforcement proceedings, whereas, in the event of a failed, negative or contested declaration, it becomes a defendant in any action to be brought to ascertain its obligation towards the debtor. The legislature also amended arts. 548 and 549 of the Code of Civil Procedure. It is stated in the new text of Art. 548 of the Code of Civil Procedure that, in the case of work credits (545 para. 3 and 4 CCP), the third party's failure to make a statement or to appear at the hearing set by the creditor is equivalent to non-contestation of the claim. Indeed, for claims other than labour claims, the new paragraph 2 of Section 548 of the Code of Civil Procedure provides that if the aggrieved party declares that it has not received any statement from the third party and, in addition, the third party does not appear at the hearing set by the aggrieved party, the court shall fix a new hearing by order, to be notified to the third party; if the third party does not appear at this second hearing either, the claim is considered uncontested. Finally, the new Section 549 of the Code of Civil Procedure provides that if objections to the third party's statement arise, they are resolved by the court by order based on appropriate findings. The order is, in the event, contestable pursuant to Art. 617 Code of Civil Procedure.
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Jurisdiction for contracts concluded on the Internet by the consumer.
[:en]What happens if one concludes a contract on the Internet, through a foreign site, and, following the conclusion, one finds problems with the contract concluded?
Which judge should I turn to? Who has jurisdiction. Read more