CTO issues first fines for P2B regulation violations: What does this mean for online platforms?

For the first time, the Czech Telecommunications Office (CTO) has enforced the P2B (Platform to Business) regulation, which is intended to ensure fair and transparent conditions for businesses using online platforms such as marketplaces, search engines and other digital intermediaries. After more than a year of monitoring, the authority has completed ten inspections and imposed fines in five cases, with a total amount of nearly CZK300,000.

What is the aim of the P2B Regulation?

The P2B regulation came into force in 2020. It's part of a broader European plan to protect entrepreneurs who rely on online platforms. In today's digital era, many entrepreneurs depend on intermediary services from big players and various online marketplaces. P2B is designed to ensure these platforms don't abuse their often dominant position to the detriment of smaller business users, indirectly protecting consumers as well.

Under the regulation, the CTO can impose fines of up to CZK10 million and can also publish decisions on infringements. The highest fine imposed was CZK120,000 and the lowest was CZK16,500. The main factors influencing the amount of the penalty are the seriousness of the offence, the financial circumstances of the offender, and the harmful impact of their conduct.

Most common violations: Incomprehensible terms and conditions, non-transparent sorting and user data issues

According to the results of the inspections, the most frequent breaches of the P2B Regulation relate to three main areas: lack of transparency of contractual terms and conditions, non-transparent ranking of goods and services and insufficient information on data access.

• Contractual terms (Article 3): the P2B Regulation requires that contractual terms are clear and easily accessible to business users throughout their business relationship with the platform. But some providers only provide terms and conditions for consumers, neglecting business users, which violates the rules. Another common issue is when the terms are only available upon request or after registration. This undermines the basic principle of transparency and can lead to unequal conditions between businesses.
• Ranking of offers (Article 5): Entrepreneurs should be able to understand how the platform determines how their offers are ranked in the search results or product list. This obligation is intended to increase predictability and allow businesses to better optimize their strategies. This requirement aims to increase predictability and allow entrepreneurs to better optimize their strategies. Information on these parameters must be included directly in the contractual terms, not hidden in other documents or only "understandable" from the interface design.
• Access to data (Article 9): Platforms must inform business users about their access to personal and non-personal user data, such as data on purchasing behaviour or product popularity. While the P2B regulation doesn't require platforms to provide this data, it mandates transparent disclosure regarding which data is accessible or that no access is granted. A common mistake is confusing this obligation with GDPR data protection, although it's a completely different issue.

Conclusion: Why should all entrepreneurs care about P2B?

The P2B regulation isn't just an overly formal piece of legislation adding another layer of rules. It's a crucial tool for protecting entrepreneurs in the digital environment. Transparency and fair conditions can have a huge impact on the success of businesses that increasingly rely on online platforms. So it's essential for not only providers but also entrepreneurs to understand their rights and how they can demand fair conditions.

By issuing fines, the CTO is sending a clear signal that non-compliance will not be tolerated. This also opens the door for discussion on how platforms can better protect the interests of their users and contribute to a fairer digital marketplace.