What Changes Does the Amended E-commerce Law Bring?

Introduction

The rules of e-commerce, which grow and develop with the digitalizing world, are changing. E-commerce has become the driving force of the digital economy.^[1] However, considering the growth rate of e-commerce and the transformation it has undergone in a short time, it is obvious that some protective and preventive legal mechanisms are needed. With this goal in mind, Law No. 6563 on the Regulation of Electronic Commerce (“E-commerce Law”) was amended and the Law Amending the Law on the Regulation of Electronic Commerce (“Amendment Law”) was published in the Official Gazette dated 07.07.2022 and numbered 31889. It is expected that the relevant provisions of the Amendment Law will enter into force beginning on 01.01.2023 and the compliance process to the relevant amendments will be completed in accordance with the periods stipulated in the Amendment Law.

Newly Introduced Concepts and Terms

One of the most important changes to the E-commerce Law are the new concepts and terms that have been added to it. These include "electronic commerce intermediary service provider," "electronic commerce service provider," "electronic commerce environment," "electronic commerce marketplace," "Electronic Trade Information System (“ETBIS”)", "net transaction volume" and "economic integrity." Some of the new concepts introduced in the e-commerce legislation are explained below:

• E-commerce intermediary service provider: An intermediary service provider that enables the conclusion of contracts, or places orders for the supply of goods or services of other e-commerce service providers, regardless of whether they sell in the e-commerce marketplace.^[2]
• E-commerce service provider: A service provider that makes a contract or takes orders for the supply of its own goods or services, either in the e-commerce marketplace or in its own e-commerce environment.
• The concept of economic integrity, which is familiar from competition law terminology, is also comprehensively defined in the Amendment Law. This is due to the fact that the Amendment Law creates comprehensive obligations for e-commerce intermediary service providers and it is important to determine which persons are responsible for them. According to the Amendment Law, economic integrity covers both horizontal and vertical control relations, real or legal persons, and commercial companies and enterprises connected with these persons.[3]

It is seen that these newly introduced concepts and terms that have entered the e-commerce legislation give clues about the actors who are responsible for them and the scope of their responsibilities.

Excluded Businesses

The Amendment Law provides that those whose establishment and activities are regulated by special laws and who operate exclusively in the areas which are covered by those laws shall not be considered to be e-commerce intermediary service providers or e-commerce service providers. Examples include businesses operating in the fields of travel agency, civil aviation, private pension, banking, insurance, financing, capital markets, payment services, betting and games of chance and electronic communication.

Obligation to Obtain an E-Commerce License

One of the most striking change brought to the E-commerce Law is the obligation to obtain an e-commerce license. E-commerce intermediary service providers and e-commerce service providers with a net transaction volume of ten billion Turkish Lira in a calendar year, and more than one hundred thousand transactions excluding cancellations and refunds, are required to obtain a license from the Ministry of Trade of the Republic of Turkey (“Ministry”) in order to continue their activities.

License fee is determined by a calculation made on the net transaction volume and the number of transactions in a calendar year. Although the procedures and principles regarding the calculation of the license fee, granting and renewal of the license are included in the Amendment Law, it is expected that the details regarding the implementation of the relevant article will be further determined by regulation. It seems that the license fee will constitute a significant amount and an important expense item for e-commerce actors.

E-commerce service providers and e-commerce intermediary service providers are obliged to obtain their licenses as of 01.01.2025. The aim of this licensing requirement is to bring undertakings of a certain size operating in the e-commerce sector under the supervision and control of the public.^[4]

Liability Arising from Unlawful Content

As per the Amendment Law, if the e-commerce intermediary service provider is aware that the content offered by the e-commerce service provider is unlawful, it is obliged to remove this content without delay and notify the relevant public institutions and organizations about the unlawful issue. In this respect, the prevention of possible grievances that might be experienced is seeked.

Under the new legal environment created by the Amendment Law, the e-commerce intermediary service provider is obliged to remove the product of the e-commerce service provider, which is the subject of the complaint, upon the complaint of the right holder, based on information and documents which demonstrate the violation of intellectual and industrial property rights. This provision demonstrates the importance given to the protection of intellectual and industrial rights of undertakings , as well as the aim to prevent the sale of products that may pose a threat to consumer health and to prevent unfair competition that may occur between undertakings.^[5]

Unfair Commercial Practices in E-Commerce

The Amendment Law also creates a new scheme for prohibiting unfair commercial practices in e-commerce. First, a conceptual clarification has been made with regard to what constitutes unfair commercial practices. Accordingly, practices of an e-commerce intermediary service provider that significantly disrupt the commercial activities of the e-commerce service provider to whom it provides intermediary services, reduce its ability to make a reasonable decision, or force it to take a certain decision which causes it to become a party to a commercial relationship that it would not normally be a party to, will be considered unfair commercial practices.

In addition, the examples of behaviors that are accepted as unfair commercial practices in all cases are listed in the Amendment Law. These include (i) forcing the e-commerce service provider to sell the goods or services with a campaign, including the unilateral change in the sales price by the e-commerce intermediary service provider, (ii) unilaterally or retrospectively amending an intermediation agreement that is to the detriment of the electronic service provider or including any provision into the intermediation agreement which may lead to these consequences, and (iii) relegation of the e-commerce service provider in the ranking or recommendation system when no objective criteria are included in the intermediation agreement, restricting, suspending and terminating the service provided by the e-commerce service provider.

This newly introduced provision to the Amendment Law enables e-commerce service providers to make decisions with their free will and not to be force to becoming a party to any contract.^[6] Therefore, the aforementioned behaviors in e-marketplaces, which are frequently subject to the investigations conducted by the Turkish Competition Authority and foreign competition institutions  have been regulated under the Turkish e-commerce legislation.

Obligations of the E-Commerce Intermediary Service Providers

The Amendment Law imposes important obligations on e-commerce intermediary service providers. In addition to the obligations that all e-commerce intermediary service providers must comply with, additional obligations have been imposed on undertakings whose annual net transaction volume and transaction number exceeds certain thresholds.

Obligations Brought to All E-Commerce Intermediary Service Providers

Firstly, electronic commerce intermediary service providers are prohibited from offering or intermediating in the sale of goods bearing their own brands^[7] or for which they have the right to use a brand in the e-commerce marketplaces where they offer intermediary services. The aim of this provision is to prevent e-commerce intermediary service providers from benefiting from their advantageous position in the market, and to prevent e-commerce service providers from using the data obtained from their sales in a way to gain advantage while competing with these e-commerce service providers.^[8]

In addition, all e-commerce intermediary service providers are obliged to enable the information in the documents required to be provided within the scope of the Tax Procedure Law to be placed in the e-commerce marketplace where the sale is made, and to verify the introductory information of the e-commerce service provider through the documents they obtain from them or from the electronic systems open to access of the relevant institutions.

The Amendment Law prohibits e-commerce intermediary service providers from engaging in marketing and promotion activities in online search engines using registered trademarks (which constitute the main element of the domain names registered in ETBIS) of the e-commerce service providers without having their prior affirmative consent. The aim of this provision is to prevent e-commerce intermediary service providers from promoting themselves on these platforms by using certain brands in online search engines without the knowledge or approval of the brand owners.^[9]

Additional Obligations of Above Threshold E-commerce Intermediary Service Providers

Other changes include significant obligations for e-commerce intermediary service providers with an annual net transaction volume of more than ten billion Turkish Lira, such as (i) using the data obtained only for the purpose of providing intermediary services, instead of using them while competing with other undertakings, (ii) carrying the data obtained by e-commerce service providers free of charge due to their sales, (iii) not providing access between their own e-commerce environments, not promoting each other, (iv) notification of company establishment and share transfer transactions to the Ministry, (v) determination of unlawful portions of the content provided by the e-commerce service provider, and notifying the Ministry.

In addition to the above-mentioned obligations, new obligations are imposed on e-commerce intermediary service providers with an annual net transaction volume of thirty billion Turkish Lira and transaction number (excluding cancellations and returns) over one hundred thousand. E-commerce intermediary service providers exceeding the specified thresholds are subject to limitations on advertising spending. Also, promotions, rewards, points, coupons, gift vouchers and similar opportunities to make under-cost sales and cross-subsidies are prohibited. In addition, provisions which prohibit the limitation of the commercial relations of the e-commerce intermediary service providers, their ability to offer goods or services at the same or different prices through alternative channels or to advertise, are introduced. Last but not least, provisions are introduced in order to prevent the fact that e-commerce intermediary service providers are compelled to supply goods or services including services by themselves such as courier services, from certain persons.

Similar obligations have been imposed on electronic commerce intermediary service providers with an annual net transaction volume of sixty billion Turkish Lira and transaction number (excluding cancellations and returns) over one hundred thousand. It is aimed to prevent e-commerce intermediary service providers exceeding the aforementioned thresholds from transferring their market power to the markets related to financial services, cargo and logistics services.

In addition, in case of providing an electronic environment for the publication of the announcements related to the goods or services, it is prevented to make a contract or place an order for the supply of goods or services in the same environment.

Obligations of the E-Commerce Service Providers

A significant part of the comprehensive obligations imposed on e-commerce intermediary service providers will also find application for e-commerce service providers by analogy.

Authority of the Ministry

The authority of the Ministry, which has been authorized to take measures and control the implementation of the E-commerce Law and the development of e-commerce, has been expanded with the Amendment Law. Thus, the Ministry has been authorized to maintain an effective and fair competition environment, to make regulations regarding the activities of service providers and intermediary service providers, and to determine the mandatory elements to be included in brokerage agreements.

Conclusion

It would not be an exaggeration to state that the new provisions brought to the E-commerce Law will seriously change the future of the e-commerce ecosystem. It is seen that the new provisions aiming to prevent unfair competition, monopolization and anti-competitive practices in e-commerce aim to restrict the movement areas of undertakings with high market power and to bring them under the supervision and control. Also, the secondary regulation regulating the details of the new obligations brought by the Amendment Law is expected to clarify the e-commerce practice in Turkey. From the perspective of competition law, even if it is considered that the new e-commerce provisions do not directly prevent competition law probes, the current situation necessitates a delicate balance between the authorities of the Ministry and the Competition Authority.