'Removing Illicit Products from Online Marketplaces: Private Enforcement Tools As Alternatives to Court Actions'

Abstract

According to the latest figures from Eurostat 65 % of internet users in the EU shopped online in 2015, and a large portion of this trade takes place through online marketplaces like eBay, Amazon, Allegro, Groupon and Zalando. The growth in the legitimate online trade is however being paralleled by a growth in the illicit trade where the marketplaces are used by vendors to sell illicit goods such as counterfeited software, clothes and mobile phones and unauthorized sale of subscription drugs such as growth hormones. Such illicit trade has significant, negative consequences for the holders of the rights that are being infringed by way of lost revenues and bad will. And this trade has reached a scale where rights infringements are listed as one of the three main concerns for businesses and business associations in relation to the role of online platforms in Europe. The sale of illicit goods on the online marketplaces also has serious negative impact on the consumers that are being misled and even risk buying harmful products, as well as for society as a whole in terms of lost jobs and lack of innovation. How to reduce or eliminate this trade are therefore an important and a prioritized issue for the decision makers as well as for the businesses that are affected by the illicit trade.The overall purpose of the Post Doc project is to provide input to the stakeholders that are engaged in these current efforts by analyzing and assessing one of the tools in the toolbox namely the “notice and takedown” procedures that are applied by most – if not all – of the operators of the digital marketplaces. These are procedures whereby a company can file a complaint (“notice”) to the operator of a marketplace and request the operator to remove (“takedown”) an illicit product that is offered for sale by an independent vendor on the market place. It is then the operator of the specific market place that decides whether to accept or to reject the complaint. Notice and takedown procedures are already being used in large numbers on a daily basis and they are being regarded as so efficient that they are foreseen by the European Commission to play a vital role in the creation of the Digital Single Market in Europe, i.e. a market within Europe where the present legal and practical obstacles for digital trade is removed. The notice and takedown tools are however based on the “terms of use” of the individual marketplaces, just as the decisions on and the execution of the concrete takedown actions are made by the private entity that is the operator of the market place. Further, the decisions are not immediately available to other than the involved parties. This is in contrast to court proceedings which are based on legislation, which are carried out by an independent public authority and whose decisions are made publicly available. Because of growing importance of the notice and takedown procedures and because of the outlined basic differences between these procedures and court proceedings, it will be essential for the stakeholders to know whether or not notice and takedown procedures can in fact be characterized as means of enforcement that are suitable to serve as alternative to court proceedings.