Meeting with
, Amazon
Ref. Ares(2024)6672967 - 20/09/2024
14 September 2021, 11.30
MEETING
of Isabelle Perignon with
Amazon
Scene setter
• Amazon wants to discuss two separate issues, on which they have been in contact before
and over the summer with JUST (E2/E3)
Consumer Protection Cooperation (CPC) action on Amazon Prime:
• BEUC called on the CPC network in January 2021 to address a number of issues,
namely the cancelation process of Amazon’s Prime subscription, currently set to make it
unduly complicated for consumers to cancel their subscription (including complicated
navigation menus, skewed wording, confusing choices, and repeated nudging). The CPC
network concluded that this practice of Amazon is infringing EU consumer law and
mandated the Commission to enter into an informal dialogue with Amazon.
• Welcome that Amazon agreed to make changes to the Prime cancellation process by
October.
• Stress that the Commission and the CPC network expect substantial changes to the
cancelation process. Underline that hurdles to cancel a subscription are not in the interest
of consumers. Cooperation with the CPC network is necessary and in Amazon’s own
interest. Otherwise CPC authorities could enter into a formal procedure under the CPC
Regulation.
Amazon’s initiative on authentic reviews:
• Amazon is asking for Commission support for their idea of an
industry initiative on
ensuring authenticity of consumer reviews on platforms. Amazon provided a first
draft text on 13 July. The units concerned (JUST E2 and E3) are still analysing the
details.
• We fully agree with Amazon that it is essential to improve the reliability of user
reviews, which are highly relevant in some areas (such as travel, but also for products)
and in reality very often biased and influenced. The Commission is looking at this issue
carefully in various contexts, in particular within the consideration to broaden the
Product Safety Pledge to a broader range of issues and within the initiative on better
online fairness. We thus encourage Amazon to take part in these processes but would
refrain from formally joining the Amazon initiative. Where Amazon detects fraudulent
review intermediaries, they should report them the national authorities.
1
Meeting with
Amazon
14 September 2021, 11.30
Speaking points
CPC action on Amazon Prime
• We welcome that Amazon agreed to make changes to the Prime
cancellation process by October. The specific
practices that
require changes were
discussed in detail with the Commission
services (on behalf of the CPC network) in a couple of online
meetings. In addition, in the report of the Norwegian Consumer
Council it is clearly explained how the current design of the
cancellation process is discouraging consumers that want to cancel.
•
Substantial changes to the cancellation process need to be
implemented in order to address these concerns adequately. We
trust that Amazon will meet these expectations.
•
the network remains open
for dialogue.
• After Amazon has implemented the announced changes in October,
the
CPC Network will assess whether the Prime service now
meets the requirements of consumer protection law.
• The network will then decide on
possible next steps, following the
procedure of the CPC Regulation (EU) 2017/2394. It could for
2
Meeting with
Amazon
14 September 2021, 11.30
example adopt a common position in a formal procedure. However
we hope that this is not necessary and that the CPC network can
close this action and
communicate on the positive changes
Amazon has made in the interest of consumers.
Amazon authentic reviews initiative
• The authenticity of reviews is an important factor for
consumers’ trust in websites and, especially, in online
platforms.
• Effective implementation of the changes to the Unfair
Commercial Practices Directive introduced by the Directive
on better enforcement and modernization is very important
(to be transposed by 28 November 2021 and applicable
from 28 May 2022).
• The Commission has issued in 2016,
guidance on the
application of the Unfair Commercial Practices
Directive, including in the area of consumer reviews. The
revised version is in preparation and due to be
published
in November or December. It addresses in more detail the
traders’ obligations in the area of consumers in accordance
with the new specific transparency rules and prohibitions
3
Meeting with
Amazon
14 September 2021, 11.30
provided in the revised Unfair Commercial Practices
Directive.
• The updated guidance will also specifically address the
application of the Directive to the review brokers that
organise the posting of consumer reviews for the benefit of
their clients on online platforms.
• We welcome any industry initiative that can support
compliance to the said Directive including by third party
traders using such brokers and brokers themselves. In
particular, defining and spreading
best practices on
ensuring the authenticity of reviews, also whether there is
room for paid-for reviews carried out according to high
neutrality standards and that would be labelled as such.
Such schemes could address the fact that very few genuine
consumers take the time to provide reviews despite their
own interest in review. This could lay the ground for much
more transparency in a domain corresponding to high
consumer demand.
• We are aware of actions by Amazon against fraudulent
practices of fake reviews harvester. We encourage Amazon
to report businesses involved in fraudulent practices to
4
Meeting with
Amazon
14 September 2021, 11.30
competent national authorities and to delist the concerned
third party traders.
•
The Commission is however, currently not planning to
join the Amazon project of industry initiative on
reviews.
• Such an initiative should clearly go beyond applicable law,
for the Commission to be supporting it.
• Regarding the participation or support from national
consumer authorities to the initiative, Amazon could seek
an opinion from the network of Consumer Protection
Cooperation authorities managed by the Commission. It
could call on the CPC network to ensure a level playing
field across the EU in these matters. We could transmit
your request to the network.
• Maybe it is also good that you wait for some weeks, as we
are preparing further activities to boost compliance to
consumer law in digital markets including regarding
reviews. Of course, we would welcome your continued
cooperation in such activities.
5
Meeting with
Amazon
14 September 2021, 11.30
• We will know more towards the end of the month and this
could be a good moment for you to have a further meeting
with the colleagues in the services.
6
Meeting with
Amazon
14 September 2021, 11.30
BACKGROUND
Amazon Prime CPC action
Amazon Prime cancellation process
Amazon Prime offers special conditions (free shipping, access to promotion etc.) to
consumers for a monthly fee, as well as access to digital content services (Amazon video,
Twitch, egames etc.). Consumers are offered to join with a 30 days free trial, which then
turns into a subscription.
The Norwegian Consumer Council analysed the cancellation process for Amazon Prime. The
analysis shows that consumers who want to leave the service are faced with a large number of
hurdles as a result of dark patterns used by Amazon, including complicated navigation
menus, skewed wording, confusing choices, and repeated nudging. Throughout the process,
Amazon manipulates users through wording and graphic design, making the process
needlessly difficult and frustrating to understand.
The conclusion of the study is that consumers should not face undue burdens in order to
unsubscribe from a digital content service, which, simply put, means that unsubscribing
should not involve more effort than signing up in the first place (or when they could
reactivate their subscription with one click).
For the alleged practices of Amazon Prime the Unfair Commercial Practices Directive
(UCPD)1, particularly its Article 7 (misleading omission) and Article 9 (aggressive
commercial practice) are the most relevant. Article 9(d) provides that “any onerous or
disproportionate non-contractual barriers imposed by the trader where a consumer wishes to
exercise rights under the contract, including rights to terminate” should be taken into account
when determining whether a commercial practices uses harassment or coercion.
BEUC’s letter to the Commission
BEUC wrote to the Commission in January 2021 about Amazon Prime’s cancellation
practices and submitted the report of the Norwegian BEUC member that outlines how
Amazon discourages consumers from cancelling the subscription.
BEUC and partner organisations in the US (cooperating under the TACD - Trans-Atlantic
Consumer Dialogue) called on European enforcers (the CPC network) and US authorities to
address a number of issues in the practical way the cancellation windows is set.
Dialogue with Amazon
1 Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 concerning unfair
business-to-consumer commercial practices in the internal market
8
Meeting with
Amazon
14 September 2021, 11.30
Amazon initiative on authentic reviews
Following the DG JUST workshop with the leading online platforms on 12 January 2021 on
consumer reviews and other relevant subjects related to the Better enforcement and
modernization directive, Amazon approached E2 and E3 colleagues to discuss the
promotion
of best practices by the industry in ensuring authentic consumer reviews.
Two meetings took place on 1 and 24 June where Amazon presented to colleagues of E2 and
E3 its measures to fight abuse of consumer reviews and described the need for closer co-
operation with the public authorities in countering the fraudulent business of review brokers –
businesses that organize the posting of fake reviews for the benefit of their client business.
Therefore Amazon proposed setting up an industry self-regulatory initiative in this area. We
were generally supportive of such industry initiative and offered to comment on the draft text,
but also signalled that DG JUST would not drive the process.
On 13 July Amazon submitted their draft for the self-regulatory initiative to E2 and E3; we
have not yet provided feedback on substance due to the summer break.
9
Meeting with
Amazon
14 September 2021, 11.30
It is important to mention that the topic of consumer reviews is also included in the draft
proposal for a
“Pledge+”, but this will be unveiled only on 23 September 2021 at the meeting
with the signatories (including Amazon) at technical level. As this meeting will take place
very shortly after this meeting with Amazon, we suggest to include a general mention of the
forthcoming discussion on ‘Pledge+” and its topics.
DG JUST is planning to get back to Amazon with a proposal to have another technical
meeting after the presentation of “Pledge+” on 23 September.
Consumer reviews also remains a good topic to discuss with a wider audience at the “Digital
Event” which is currently being considered in the Digital Task Force.
10
