The Regulation on Electronic Commerce Intermediary Service Providers and Electronic Commerce Service Providers (the "Regulation") was published in the Official Gazette dated 29 December 2022 numbered 32058 and entered into force on 1 January 2023 in order to regulate the principles and procedures regarding implementation of the Law on the Regulation of Electronic Commerce dated 23 October 2014 and numbered 6563 (the "Law").

This Monthly Updates aims to provide a brief explanation on the Regulation and highlights the essential novelties introduced therein.

Scope of the Regulation

Within the scope of the Regulation, the obligations of electronic commerce intermediary service providers (the "ECISP") and electronic commerce service providers (the "ECSP"), and electronic commerce licence, unlawful content, unfair commercial activities, intermediary agreement in electronic commerce are regulated.

Definitions of the ECISP and the ECSP

In accordance with the Regulation, the ECISP is defined as an intermediary service provider that enables the execution of contracts or placing orders for the supply of goods or services of the ECSP in the electronic commerce marketplace; and the ECSP is defined as a service provider that makes a contract or receives an order for the supply of goods or services in the electronic commerce marketplace or in its own electronic commerce environment by the Regulation.

In addition, the Regulation has divided ECSP and ECISP into three groups according to their net transaction volumes and number of transactions excluding cancellations and refunds as (i) medium sized; (ii) large sized; and (iii) very large sized.

Obligations of the ECISP and the ECSP

The Regulation does not provide separate provisions for the ECISP and the ECSP, instead the Regulation regulates the obligations of the ECISP and the ECSP together. Unless specifically stated, these obligations shall apply to all the ECSP and the ECISP regardless of their size.

The information to be provided by the ECSP on its own medium and the information to be disclosed to the ECISP when they sell through marketplaces of the ECISP is specified in the Regulation. In line with this, the Regulation sets forth that the ECISP cannot provide intermediary services to the ECSP whose information cannot be verified.

The Regulation regulates the obligations of the ECISP and the ECSP regarding transactions. Accordingly, the ECISP and the ECSP are responsible for (i) the sale of secondhand goods in separate categories, (ii) seeing the total price to be paid by the customer before confirmation of the order, (iii) providing the summary order form to the customer before confirmation of order, (iv) providing the contract provisions to the buyer, either physically or electronically.

Not Offering ECIPS's Own Brands for Sale

The provision in the Law stating that the ECISP cannot sell goods bearing their own brand in electronic commerce marketplaces where they provide intermediary services does not regulate the situation where the manufacturers of these products are a different person. The Regulation clarifies that the obligation for not selling the ECISP's own brand is applicable regardless of the producer of the products. In addition, the Regulation provides two exemptions to this obligation: sale of (i) goods bearing the trademark of persons who derive more than half of the total sales revenue from sales other than electronic commerce; and (ii) periodical publications and devices that allow the reading/listening/use the digital copies of e-books.

Share Transfer Notification

Medium sized, large sized and very large sized ECISPs and ECSPs must notify to the Ministry of Commerce through the Electronic Commerce Information System (the "ECIS") the transfer or acquisition of shares of the shareholders, reaching 5% or multiples within the company, within one month from the date of the transfer or acquisition is registered in the share ledger.

Electronic Commerce License

Medium sized, large sized and very large sized ECISPs and ECSPs must obtain an electronic commerce license from the Ministry of Commerce in order to continue their activities and such licenses should be renewed every year. Accordingly, license applications shall be made through ECIS each year during March. Obligation to obtain such license shall be fulfilled as of 1 January 2025.

Unfair Commercial Activities

With the Regulation unlawful commercial activities are defined. Accordingly, the ECISP's activities that significantly affect the commercial activities of the ECSP, reduce its ability to make a reasonable decision, or force it to take a certain decision causing it to become a party to a commercial relationship that it would not normally be a party to are considered as unfair commercial activities.

Intermediary Agreement

According to the Regulation, the conditions of the commercial relationship between the ECSP and the ECISP are specified by the intermediary agreement made in writing or electronically. The Regulation introduces the provision regarding the minimum elements of the intermediary agreements.

The Regulation further sets forth the procedure for amendments and termination of the intermediary agreement. Accordingly, unless a longer period has been determined by the ECISP, the amendments on the agreements are put into effect at the end of 15 days from the date of notification made via internal communication system. The ECSP may terminate the intermediary agreement without compensation, by making a notification via the internal communication system before the expiry of this 15 days period. The termination will be effective from the date of the notification of termination. In addition, the provisions of the intermediary agreements executed before 1 January 2023 should be amended to be compliant with the Regulation until 1 July 2023, otherwise such provisions shall be deemed invalid.

Conclusion

The Regulation specifies the requirements that have been introduced by the Law relating to the ECISP and the ECSP and introduces various new obligations. In addition, the scope of intermediary agreements and the procedure regarding the amendment of such agreements are detailed under the Regulation. The ECSPs and the ECISPs are required to carry out the necessary compliance process stipulated by the Regulation.

Originally published February 2023

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.