In short. An online comparison service must make general information about its main ranking parameters and their relative importance directly accessible from its results page.
Definition: Under Article 7(4a) of the EU Unfair Commercial Practices Directive, a comparison service that lets consumers search across different sellers' products must explain its main ranking parameters and their relative importance. Ranking means the prominence given to products, and the explanation must be directly and easily accessible from the search results page.
Key facts
- Article 7(4a) of the Unfair Commercial Practices Directive treats the main ranking parameters and their relative importance as material information for consumers.
- Article 7(1) of Directive (EU) 2019/2161, which introduces this requirement, sets 28 May 2022 as the date for applying the national implementing measures.
- The European Commission's guidance, section 4.2.3, identifies online marketplaces and comparison tools as covered services; a trader searching only its own offers falls outside this particular requirement.
Which searches does the rule cover?
Article 7(4a) of the directive covers queries expressed as keywords, phrases or other input, wherever the final transaction takes place. Under Article 2(c), products include goods and services, including digital services and digital content. A comparison service can therefore fall within the rule even when it sends consumers elsewhere to buy.
The Commission's guidance distinguishes results generated by a consumer's query from the default arrangement of an interface displayed without a query. The latter falls outside Article 7(4a). The article also excludes online search engines as defined by the Platform-to-Business Regulation, Regulation (EU) 2019/1150; the guidance explains that these engines already have a publicly accessible ranking-description duty under that regulation.
What must the explanation contain?
Recital 22 of Directive (EU) 2019/2161 describes parameters as criteria, processes, signals incorporated into algorithms, or adjustment and demotion mechanisms used in ranking. The explanation covers the main default parameters and their importance relative to other parameters. Recital 19 also identifies visual highlights as a way of giving offers prominence.
Recital 23 calls for a general description. It expressly leaves the detailed functioning of ranking mechanisms, including algorithms, outside the disclosure requirement and allows an explanation that applies across individual queries.
Where must consumers find the information?
Article 7(4a) of the directive specifies a dedicated section of the online interface, directly and easily accessible from the results page. Article 7(2) also addresses material information presented unclearly or too late where that presentation causes, or is likely to cause, a transactional decision the consumer would otherwise avoid.
The Commission's guidance requires a clear, comprehensible explanation appropriate to the communication medium. It expressly includes searches made through voice commands: the information remains available for consultation in a specific section of the trader's website or application.
How does this differ from paid-placement disclosure?
Annex I, point 11a of the directive separately prohibits search results that fail to disclose paid advertising or payment specifically for higher product ranking. The Commission's guidance says the paid-placement disclosure is additional to the general ranking explanation. It calls for advertisements and results promoted through such payments to be clearly and prominently identified alongside the relevant result.
Related terms
FAQ
Does the rule apply if customers buy on another website?
Yes. Article 7(4a) of the directive expressly applies irrespective of where transactions are ultimately concluded.
Must the service explain the reasons behind each parameter's importance?
The Commission's guidance says the consumer-facing requirement covers the main parameters and their relative importance. Unlike the business-facing P2B requirement, it does not require the reasons for that relative importance.
Must you publish a separate explanation for every query?
No. Recital 23 of Directive (EU) 2019/2161 allows a general explanation of the default main parameters without customising it for each individual query.
Sources
- European Parliament and Council, "Unfair Commercial Practices Directive", consolidated text, 28 May 2022
- European Parliament and Council, "Directive (EU) 2019/2161", 27 November 2019
- European Commission, "Guidance on the interpretation and application of Directive 2005/29/EC", 29 December 2021
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