E-commerce sector inquiry: a new round of questionnaires has been distributed

comp blogEven though Brussels feels abandoned, certain areas resembling a movie set from a post-apocalypse movie, the E-commerce sector inquiry is ongoing. Chasing down all competition concerns in the e-commerce sector, the Commission has sent out a new round of questionnaires focusing on online marketplaces that act as hubs for independent traders (e.g Amazon.com or eBay).

As you might have followed, the Commission has launched the long awaited sector inquiry on 06 May 2015 to determine potential barriers erected by companies to cross-border online trade in goods and services where e-commerce is most widespread, as well as in digital content. The Herculean task will focus on vertical restraints in distribution agreements affecting online cross-border sales. In pursuit of information, the Commission has already sent two rounds of questionnaires to retailers and owners of digital content to determine how products are sold and distributed over the web.

A new round of questionnaires has been sent last week to gain understanding of how online platforms work and how they compete for sellers. More specifically the Commission hunts for information on contract terms between platforms and sellers, pricing practices and the handling of data. Concerned that online marketplaces are artificially divided up nationally through contractual barriers and that consumers are barred from making cheaper purchases in another country, the Commission inquires into clauses that set a minimum price, include exclusivity or stop sellers offering lower prices over other sale channels. The gathering and use of data on users is also of interest to the Commission as it believes the data could not only be shared or sold to traders but also re-utilized to reroute customers or deny purchase.

In light of the recent heterogeneous decisions of several national competition authorities regarding parity clauses (Booking.com, Expedia…), the sequel to this round of questionnaires could lead to the opening of very interesting EU competition cases.

Note that all responses to the new round of questionnaires will be due mid-September. The preliminary report followed by a public consultation will be out mid-2016 and companies can expect the final report in the first quarter of 2017.

Sarah Cumming is a Consultant in FTI Consulting’s Competition practice.

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