6 Changes in European law that every Shopify store owner should know.

Do you own a Shopify store? Then read this blog carefully! Starting from the 28th of May 2022, we will get some new rules regarding online commerce. These rules are about reviews, pricing, sales and ‘free’ digital services. Read carefully which six changes are coming your way and how to prepare for them.

The rules are not just for The Netherlands but will be implemented as the new European guidelines. That does not mean that you have to wait to implement these rules on the 28th of May; the quicker you abide by these rules, the more consumer-friendly you are and the better you will be able to differentiate from your competitors!

Personalised offers (Personalisation)

Do you offer personalised deals/products to your customers? Using data collected from search history, geographic location, purchase history, et Cetera? In the future, you must let your customers know that you use personalisation by using a pop-up on the payment page.

This way, customers know that this is a personalised deal and can rationally decide if it is their best offer. It may sound like this is bad for business, but transparency has always been vital in e-commerce!

Reviews

Do you display reviews on your website, product pages, or social media? You must let your customer know these three things:

The way you check that these reviews are really from customers and have not been posted by bots or other methods by which people can post fake reviews.
You must prove that all positive and negative reviews are being shown
Also, you must give your customers notice if any is sponsoring amongst these reviews (Paid Reviews).

*On social media, it’s prohibited to post fake consumer reviews*

Since consumers base their decision-making on these reviews, it is essential that these reviews are genuine. Otherwise, it would be deception, which in the end only hurts the reputation of the company.

Most businesses are partnered up with Trustpilot or Kiyoh. If that is the case for your business, there’s nothing to worry about since these companies have already applied these rules. If you do not use a partner for your social proof, you should check if your way of showing reviews takes these new rules into consideration. Or look up the two companies mentioned above!

Discounts

From May 28, 2022, you can no longer take any ‘random’ price as the basis for giving a discount. You’ve probably seen some of these: “Amazing discounts from price X now for price Y”, while the base price has been tactically changed the day before.

If you’re advertising from-for-discount, you should assume the lowest price you used for that item at least 30 days prior to the discount promotion. This is, again, to protect consumers from being deceived.

You are allowed to show a discount compared to your competitor’s price or the suggested retail price of a certain product, as long as you use the actual prices.

‘Free’ digital services

Do you provide ‘free’ digital services in exchange for users’ personal information? Then you’ll have to provide details about how long clients are committed to the digital service. Consumers can discontinue the free digital service within 14 days. In that case, you must halt and erase that customer’s data storage.

The next couple of changes are not for Shopify stores per se, but good to know anyway.

Online marketplaces

Online marketplaces must inform consumers with whom they are condoning business. In addition, they must indicate whether it is a business or consumer and which conditions apply to the agreement. Businesses must clearly show this information on your payment page (they cannot put it in the fine print of the terms and conditions).

Marketplaces have to investigate in addition to the requirement to disclose information. As an online marketplace, you must seek information about the seller’s legal standing (business or private individual) and the terms and conditions of the seller who offers services or items through your platform.

This is all, again, to protect the consumer! Which we as businesses should have high on our list!

Comparison websites

If a comparison website has a search function, it must be upfront about how these search results come about. If the website alters the search results based on sponsoring, this has to be made known to the consumer.

You must provide this information on the page you show the search results, regardless of whether a visitor buys something from it.

What will happen if you do not abide by the rules?

The ACM (Autoriteit Consument en Markt) and AFM (Autoriteit Financiële Markten) can impose fines or give violators a term within which they must resolve the incorrect situation. The fines can amount to 4% of the annual turnover or to a maximum fine of 2 million euros. If a violation occurs more often, the percentage can rise to 10% of the yearly turnover.

If you want to know more about the new rules regarding e-commerce, you can consult these websites:

Till next time!