FinTech in Turkey: Overview
Ekin İnal and Ecem Naz Boyacıoğlu provide an overview of FinTech in Turkey.
On 9 January 2016, the Regulation on Consumer Online Dispute Resolution entered into force imposing new information requirements in e-commerce across the European Union:
On 9 January 2016, REGULATION (EU) No 524/2013 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 21 May 2013 on online dispute resolution for consumer disputes and amending Regulation (EC) No 2006/2004 and Directive 2009/22/EC (Regulation on consumer ODR or ODR Regulation) came into force (Article 22, paragraph 2). It is directly applicable and mandatory in every EU Member State.
The objective of the ODR Regulation is to set up a mechanism for resolving disputes stemming from online transactions without affecting the parties’ right to approach any state courts. Through creating a simple, efficient, fast and low-cost way of resolving disputes, the European legislators aim to strengthen consumer protection and at the same time, by boosting confidence in the digital Single Market, encourage cross-border transactions.
To this effect, an ODR platform at Union level will be created, offering a single point of entry for consumers and traders seeking to resolve disputes out-of-court. The ODR platform shall provide general information regarding the online resolution of contractual disputes and allow consumers and traders to submit complaints in all the official languages of the institutions of the EU. Complaints will then be transmitted to the competent alternative dispute resolution entity (ADR entity) in the relevant member state. The ADR entities may (without being obliged to) conduct the dispute resolution procedure with the parties through the ODR platform. The ODR Regulation should therefore be read in conjunction with the Directive on Alternative Dispute Resolution (2013/11/EU), which requires the EU member states to set up a mechanism similar to an “additional judiciary branch” for dispute resolution involving consumers. In Germany, this Directive will be implemented by enacting the Consumer Dispute Resolution Act (Verbraucherstreitbeilegungsgesetz or VSBG) which will also regulate the ADR entities.
The ODR Regulation generally applies to all traders established in the European Union who offer goods and services to and take orders from, among others, consumers within the European Union on a website or by using other electronic means. ”Presentation only” websites are excluded. The websites do not necessarily need to be owned by the traders. Rather, the ODR Regulation also applies to “open“ sales platforms and online marketplaces within the European Union.
The ODR Regulation primarily refers to disputes initiated by consumers against traders. Subject to some restrictions, it also applies to disputes initiated by a trader against a consumer (Article 2, paragraph 2), in so far as a competent ADR entity undertakes to handle the dispute resolution procedures against the consumer. Conversely, B2B disputes are generally not covered by the ODR Regulation.
The ODR Regulation also applies to purely domestic online transactions.
In order to ensure broad consumer awareness of the existence of the ODR platform, according to the first sentence of Article 14 of the ODR Regulation, traders and online marketplaces shall provide on their websites an electronic link to the ODR platform (http://ec.europa.eu/consumers/odr). This obligation applies irrespective of whether the traders actually consider entering into an out-of-court dispute resolution. Pursuant to Article 14, paragraph 1, sentence 3 of the ODR Regulation, traders are also obliged to state their email addresses. There are no particular requirements as to the specific positioning and/or the contextual framework of the information being made available. Article 14, paragraph 1, sentence 2 of the Regulation requires the link to be easily accessible for consumers. As similar requirements apply to the section of websites giving the mandatory publication details (“Impressum”), in practice it would be relatively simple to implement the information requirements in this (easily accessible) section which has to state the provider’s email address anyway. One should also consider the Commission’s delay in establishing the ODR platform as well as the fact that the latter is not operational yet. The platform is expected to become functional on 15 February 2016. According to the Regulation, this delay does not affect the general information requirements.
In the future, further information requirements may ensue from Article 14, paragraph 2 of the ODR Regulation. However, this provision affects only traders which are committed or obliged to use an ADR entity to resolve disputes with consumers, unlike Article 14, paragraph 1 of the Regulation. As Directive 2013/11/EU has not been implemented in Germany at the time of writing, despite being required by the EU law (discussed in more detail below), and as no ADR entities have been put in place under the Consumer Dispute Resolution Act, Article 14, paragraph 2 is, in practice, of no importance in Germany for now. However it may follow, that traders will be obliged under this provision to further inform consumers about the possibility of using the ODR platform for resolving their disputes. In case the offer is made by email, traders shall provide an electronic link to the ODR platform in that email as well. In addition, the information shall also be included in the general terms and conditions used by the trader.
For the sake of completeness, it is notable that the Consumer Dispute Resolution Act will soon impose further obligations to supply information. Under Section 36 VSBG, traders must state on their websites and in their general terms and conditions whether they are willing or obliged to take part in dispute resolution processes. In case they do, the traders must indicate the competent ADR entity, including its address and website, and must make a statement to the effect that they will participate in a dispute resolution procedure before this consumer dispute resolution entity. Section 37 VSBG includes further information requirements pertaining to the time after a dispute has arisen. Traders must provide information regarding the competent ADR entity, once again including its address and website, and state if they are willing to participate in dispute resolution proceedings. Because the Consumer Dispute Resolution Act was only adopted by the German Parliament in December 2015 and has not yet been approved by the Federal Council (Bundesrat) as required by law, for now there is no urgent need for action in this respect.
The ODR Regulation does not provide for specific penalties for infringement of information requirements. The Member States shall each lay down the rules on any penalties provided that the latter are “effective, proportionate and dissuasive“ (Article 18 of the ODR Regulation). From a German law perspective, such infringements may be viewed as a violation of competition law pursuant to the Act Against Unfair Competition (Gesetz gegen den unlauteren Wettbewerb or UWG) which may trigger competition law ”cease and desist” letters and/or legal actions. It is unclear whether the above applies at present, that is, before the ODR platform has become operational. To minimize the risk of being sanctioned, it is recommended that traders make a reference to the ODR platform and comply with the above information requirements as soon as possible.
Ekin İnal and Ecem Naz Boyacıoğlu provide an overview of FinTech in Turkey.
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