The Spanish Draft Bill aiming to ensure compliance with Regulation (EU) 2019/1150 (the “P2B Regulation”) has been published

Written on 22 Sep 2020

The Draft Bill, which is currently under discussion in the Spanish Senate until 31 October, would amend Act 34/2002, of 11 July, on information society services and electronic commerce ("LSSI") to include infringements of the P2B Regulation under its sanctioning regime, categorising such infringements as minor or serious infringements.

The P2B Regulation is directly applicable across EU Member States since 12 of July 2020. However, the P2B regulation contains a mandate for Member States to lay down appropriate national legislation and set out any applicable measures against infringements of the P2B regulation in order to ensure its enforcement. In this sense, the Spanish Parliament has decided to amend the LSSI (the Spanish law implementing the ecommerce Directive) and adapt it to the provisions of the P2B Regulation, as provided for in the Draft Bill regulating certain aspects of electronic trust services (the "Draft Bill").

By way of introduction, we recall that the P2B Regulation encourages a more transparent, fair and predictable environment for businesses offering their goods or services to consumers located in the EU through online intermediation services (called business users) vis-à-vis businesses providing such online intermediation services. As such, the P2B Regulation imposes multiple obligations on providers of online intermediation services to ensure such an environment (such as obligations for transparency on their terms and conditions that business users are forced to accept). The P2B Regulation brings more protection for European consumers, as these may be forced to ultimately bear the consequences of potential abuses of online intermediation services on professional users.

In this context, the third final provision of the Draft Bill modifies the LSSI, mainly in order to contemplate the various infringements included in the P2B Regulation and to cover them within a Spanish sanctioning regime, ensuring the enforcement thereof. In particular, the Draft Bill sets forth that infringements of the P2B Regulation will be subject to the sanctioning regime of the LSSI, and categorises such infringements as minor or serious (which means that infringements of the P2B Regulation in Spain may imply a maximum sanction of EUR 150,000). It is important to note that these sanctions may be adjusted in accordance with the criterion of moderation of the sanctions and the graduation of the amount of the sanctions envisaged in the LSSI.

Hence, the Draft Bill would add a considerable number of scenarios within Articles 38(3) and 38(4) of the LSSI (which refer to serious and minor infringements under the LSSI) in order to cover all potential infringements in relation with the obligations laid down by the P2B Regulation. We should note that the Draft Bill categorises the majority of infringements of the P2B Regulation as a minor infringement (implying sanctions of up to EUR 30,000), provided that such infringement is not persistent. However, it remains uncertain what would be the criterion to determine whether an infringement of the P2B Regulation is persistent, and whether it would be required that the infringement is committed against several business users in order to be considered as such. In any event, the LSSI would consider the following infringements as serious:

  • The infringement of the obligation not to impose retroactive changes to terms and conditions (Article 8(a) of the Regulation P2B).
  • The infringement of the obligation to establish an internal system for handling the complaints of business users that is free, where the infringer is not a small business (Article 11 of the Regulation P2B).
  • The infringement of the obligation to identify in the terms and conditions two or more mediators with which providers of online intermediation services are willing to engage to attempt to reach an agreement with business users, where the infringer is not a small business (Article 12 of the Regulation P2B).

The Draft Bill also modifies the text of the LSSI by transferring the supervisory and sanctioning competences (in relation with the enforcement of the LSSI) from the former Ministry of Industry, Energy and Tourism to the current Ministry of Economic Affairs and Digital Transformation (MAETD). In addition, the Draft Bill would also set forth that organisations and associations that have a legitimate interest in representing business users (that meet the requirements laid down in the P2B Regulation), may request directly to the MAETD to be included in the list of such organisations and associations drawn up by the European Commission (that serves as refutable proof of their legal capacity to bring any relevant actions on behalf of business users), which should also notify any sudden circumstance that may imply a failure to comply with the requirements established in the P2B Regulation for such entities to the MAETD immediately.

Regardless of whether the Draft Bill will ensure compliance with the P2B Regulation or not, we should note that the European Commission has announced further measures to strengthen confidence in the online platform economy, starting with guidelines on the ranking of business users within platforms (as to help platforms improve predictability and transparency to help business users consider how best to increase and manage their online visibility). Likewise, the European Commission has also announced that will take into account the impact of the P2B Regulation on the digital market (based on the feedback of the progress reports prepared by the expert group for the Observatory on the Online Platform Economy) to keep working on the Digital Services Act package.

The Draft Bill is not yet enacted and 17 amendments have been proposed for the text before the Senate, however, these amendments would not refer to the third final provision of the Draft Bill. Thus, we believe that the current wording of the Draft Bill, as far as the P2B Regulation is concerned, could see little further changes.