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Omnibus Directive - how do new rules on publishing opinions affect the e-commerce market?

Katarzyna Chomąt
16/11/2023 | 7 min read
Omnibus Directive - how do new rules on publishing opinions affect the e-commerce market?

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    The day has come that will be a breakthrough in consumer rights protection. Of course, we are talking about the implementation of the Omnibus Directive into Polish law. What are the changes? What is prohibited? How to protect your shop from sanctions? We answer these questions in the article below.

     

    The Omnibus Directive is a response to unethical business practices

     

    Ensuring a high level of consumer rights protection is one of the main objectives of the regulations introduced by the European Union. Therefore, the aim of the Omnibus Directive is the elimination of unfair trade practices detrimental to consumers, as well as better enforcement of consumer protection laws. One of the actions taken is the fight against unethical practices related to manipulating reviews on websites.

     

    Why did the European Union pay attention to reviews? The reason is that ratings and reviews have a significant impact on how businesses are perceived and influence purchasing decisions made by the majority of consumers. Unfortunately, some companies take advantage of this fact by engaging in dishonest actions such as trading reviews or commissioning the creation of false reviews.

     

    So what does the Omnibus Directive change and how do the new regulations affect business operations?

     

    Greater transparency and an end to fake reviews

     

    The Omnibus Directive not only prohibits the creation or purchase of fake reviews, but also their manipulation (e.g. by removing negative reviews and displaying only positive ones). According to the new regulations, it is also considered an unfair market practice to claim that reviews come from consumers who have purchased the product if the business does not take steps to verify the reviews.

     

    In addition, the new regulations introduce the obligation to clearly inform consumers whether and how reviews posted on the website are verified by the company. The Directive does not explicitly require the verification of reviews, but it imposes the obligation to provide information on whether the company checks the authenticity of reviews and how it processes them.

     

    "It's no wonder that news of the directive has caused quite a stir among many companies, who have started looking for support and solutions among the products available on the market. No one wants to give up such an effective marketing tool as positive reviews from other customers. Fortunately, it is possible to prepare for the implementation of the regulations, and we are pleased to be able to support businesses in this regard," says Karol Bocheński, COO at Rating Captain.

     

    How to collect and display reviews in accordance with the Omnibus Directive?

     

    There are several ways to collect reviews, including sending email invitations and SMS messages after delivering an order or completing a service, using stickers with QR codes placed in visible locations in the company's premises or included with the shipment, as well as pop-ups and rating forms on the product page. It is best to test different solutions, as different methods work in different industries.

     

    However, the most important thing is to choose a method that allows reviews to be linked to real customers. This can be done by sending messages containing a link to the review submission page. Another solution is to provide the option to add a review only for logged-in users. It is also possible to include a requirement to enter the order or reservation number in the rating form.

     

    However, it is not enough for businesses to collect reviews. They should also provide information on how the reviews are processed, such as whether all reviews, both positive and negative, are published, whether the reviews are sponsored, where they come from, and how the average rating is calculated. This information should be placed in the same location where consumer reviews are published, such as on the product page (visible hyperlinks can also be used). The terms and conditions of the store or website are a suitable place to include information about the review processing method. It is worth noting that these issues are extremely important as they confirm the transparency of the company, which is emphasized by the Omnibus Directive.

     

    What happens in case of an inspection?

     

    In the event of a possible inspection by the President of the Office of Competition and Consumer Protection (UOKiK), a business displaying reviews on its website will have to prove that it has taken care to ensure that the displayed reviews come exclusively from real customers. To avoid penalties for oversights, companies should implement solutions that confirm the authenticity of reviews.

     

    Of course, one of the remedial measures could be not displaying customer reviews on the website. However, in this way, the business reduces the chance of making sales, as potential customers, relying on reviews, will choose a company that has been verified by other consumers - the competition.

     

    A more favorable solution is therefore to provide potential customers with the opportunity to familiarize themselves with reviews about the product or company before making a purchase. This requires verifying your own review systems and adding an appropriate message about the review origin verification process.

     

    UOKiK and penalties for non-compliance

     

    The Omnibus Directive introduces high fines for non-compliance with its provisions. The amount of the fine can be up to 4% of the annual turnover of the entity in the member state or at least EUR 2 million if turnover information is not available. The fine may be even higher if a member state introduces such a penalty into its legislation. In the case of cross-border infringements, national authorities of member states can cooperate. The amount of the fine will be graduated depending on the seriousness, duration, and scale of the infringement, as well as other circumstances. Consumers have the right to compensation for unfair trade practices. According to UOKiK, creating, acquiring, and posting fake reviews online can result in a financial penalty of up to 10% of turnover.

     

    It is also worth mentioning that the Office of Competition and Consumer Protection (UOKiK) announced in a statement that it has already conducted inspections of approximately 40 e-commerce platforms from various sectors in terms of compliance with the Omnibus Directive. As a result of the inspections, UOKiK noticed several irregularities, such as unclear presentation of sale prices and crossed-out prices without explaining what a crossed-out price is, as well as the use of formulations other than "the lowest price of the product in the 30 days before the price reduction." In the case of identified irregularities, UOKiK sent requests for explanations to the owners of the platforms and called for changes to questionable practices.

     

    "The Omnibus Directive is an important step towards ensuring consumer protection in the European Union. High fines and the possibility of compensation will motivate businesses to comply with the regulations, and cooperation between national authorities in the case of cross-border infringements will ensure effective enforcement," comments Mateusz Jakubik, Information Security Officer at iSecure.

     

    Summary

     

    The Omnibus Directive raises many emotions, but it is not as complicated as it may seem at first. For example, an information obligation regarding the verification of reviews has been introduced, which should result in the elimination of fake reviews and recommendations. Regarding reviews, prohibited trade practices that may mislead consumers have also been clarified.

     

    Despite stricter regulations, it is not advisable to give up presenting reviews to potential customers on the website. It is important to remember that consumer ratings and comments are a great advertising tool and an important factor in making purchasing decisions. Therefore, it is worth investing in dedicated tools, such as Rating Captain, which will collect genuine reviews and display them on the website in accordance with the directive, while also providing valuable information about customers and the products or services being sold.

     

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