Shopify agrees to consumer safety tweaks in Europe

Shopify has agreed to make changes linked to shopper safety and combating fakes after a regulatory intervention in the European Union following a number of complaints, the Commission said today.

The changes agreed to include a commitment to create a “fast and effective” ‘notice and action’ procedure for national consumer authorities to report problems they spot; and an agreement to change its templates to encourage traders to be more transparent with consumers.

Per the EU, the complaints — which it said peaked during the COVID-19 pandemic — mainly related to web stores hosted by the B2B e-commerce platform which were found to have engaged in illegal practices, such as making fake offers and fake scarcity claims; supplying counterfeit goods; or not providing their contact details.

It said Shopify has agreed to take down shops when concerns are raised with it by national consumer protection authorities in the EU — and to provide “relevant company details” to the regulators.

As regards its templates, the EU said Shopify has committed to including fields for company information and contact details in templates for web shops’ contact pages and generators for Terms and Conditions, Privacy Policies and Refund Policies.

It has also agreed to provide clear guidance to traders on applicable EU consumer law, it added.

The background here is the EU launched a dialogue with Shopify in July 2021 in conjunction with the EU’s network of national consumer protection (CPC) authorities to press Shopify to make changes to address illegal practices of traders on its platform.

In a statement, justice commissioner Didier Reynders welcomed Shopify’s commitments:

Almost 75% of internet users in the EU are shopping online. This is a huge market for scammers and rogue traders to exploit, and they will continue to do so unless we act. We welcome Shopify’s commitment to ensure that traders operating on its platform are aware of their responsibilities under EU law, and are taken down if they break the rules.

The EU added that national consumer authorities in the region have also agreed to reinforce their cooperation with the Canadian Competition Bureau against Shopify traders that are not based in the EU/EEA — suggesting they will seek to alert Shopify’s domestic regulator to consumer protection issues that might affect users elsewhere.

The bloc said Shopify’s implementation of the commitments will be monitored by the CPC, adding that national consumer protection authorities could also decide to launch actions at a national level to ensure EU standards are upheld.

A similar EU-CPC dialogue procedure recently involving TikTok — also kicked off in response to a series of complaints — led the video sharing platform to make some commitments to beef up ad disclosures.

While Amazon also recently bowed to coordinated pressure from EU consumer protection regulators — agreeing to ditch Prime cancellation dark patterns in the region after another one of these CPC interventions.