Italian Consumer Law Update - Amendments to the Unfair Commercial Practices Directive
21 September 2022
21 September 2022
On 26 August 2022, the European Delegation Law 2021 (Law 127/2022, the "EDL") was published in the Italian Official Gazette. The EDL implements the Omnibus Directive (Directive (EU) No. 2019/2161) which is designed to modernise consumer protection rules and improve enforcement of these rules in the EU. The EDL will enter into force on 10 October 2022.
Pursuant to Article 4 of the EDL, the Italian Government shall adopt legislative decrees to implement the necessary changes to the Italian Consumer Code within 12 months of the EDL entering into force.
- The Omnibus Directive introduces amendments to four Directives which offer protection to consumers when purchasing goods and services.
- A number of these changes reflect the growth in e-commerce, including expanding key definitions to cover digital services and digital content.
- One of the key goals of the amendments is to promote transparency by reducing the scope for misleading information. Key changes include ensuring: (i) consumers using online marketplaces understand with whom they are contracting, (ii) consumers have access to information about how rankings are determined and (iii) consumers understand whether reviews are written by genuine customers and if any contractual relationship may have influenced the review.
- The Omnibus Directive also introduces a blacklist of commercial practices that will be considered to be unfair, including commissioning fake reviews.
The Omnibus Directive is part of the New Deal for Consumers in the EU and aims to strengthen consumer protection, by amending the following four Directives:
In this post, we will provide a brief overview of the key changes to the Unfair Commercial Practices Directive by the Omnibus Directive.
The Unfair Commercial Practices Directive defines the unfair business-to-consumer commercial practices that are prohibited in the EU. It applies to any act or omission directly related to the promotion, sale or supply of a product by a trader to consumers and protects the economic interests of consumers before, during and after a commercial transaction has taken place.
In line with the evolution of technology, the definition of "product" has been amended to include "digital services" (e.g. video and audio sharing services and other file hosting, word processing or games offered in the cloud, cloud storage, webmail, social media and cloud applications, etc.) and "digital content" (e.g. web-streaming of video clips). Similarly, the definition of online marketplaces now includes "software" and "apps" and is not limited to websites only.
The new provisions seek to enhance transparency in relation to information that may affect a consumer's decision-making process. The types of key information set out below must now be disclosed, particularly by online marketplaces:
The list of practices that will be considered unfair (the so-called "blacklist") includes:
The new provisions are primarily designed to strengthen consumer rights in the online context and will greatly impact online intermediaries and traders. As will be discussed in a subsequent alert, the Autorità Garante della Concorrenza e del Mercato (Italy's consumer protection authority) will have enhanced powers, including the ability to impose significantly higher fines. The Italian authority has always been very active in consumer protection cases, and we expect this trend to continue in the future, with higher fines being imposed for the most pernicious conduct.