ABSTRACT
The use of the Internet for commercial purposes has led to the emergence of a new trading platform called electronic commerce. Thus, the need for the establishment of a legal infrastructure for electronic commerce has emerged in our country.
I. INTRODUCTION
With the publication of the Regulation on Electronic Commerce Intermediary Service Providers and Electronic Commerce Service Providers (“Regulation”) in the Official Gazette dated 29.12.2022 and numbered 32058, the Law on Electronic Commerce Service Providers and Intermediary Service Providers published in the Official Gazette dated 26.08.2015 and numbered 29457 was repealed. The right to draft a regulation for the application of the Law on the Regulation of Electronic Commerce, granted to the Ministry of Commerce according to Article 13 of the Law (“Law on the Regulation of Electronic Commerce”), served as the foundation for the creation of the Regulation.
II. GENERAL INFORMATION ON ELECTRONIC COMMERCE
The Internet has been used for many reasons such as communication, information and trade for many years. The use of the Internet as an electronic commerce tool dates back to the 1990s. Accordingly, the Internet has achieved its main development with the increase in its commercial use1. The use of the Internet for commercial purposes has led to the formation of a new trading platform. This new platform, called electronic commerce, has been rapidly adopted and developed by both the production and consumption segments. The fact that the Internet eliminates distances in trade and enables simultaneous interactive transmission of audio, video and written text has led to the rapid adoption of electronic commerce by all segments2.
There are different definitions of the concept of “electronic commerce” in various sources. According to the World Trade Organization, electronic commerce is the production, advertising, sales and distribution of goods and services over telecommunication networks3.According to the definition made by the Organization for Economic Cooperation and Development, electronic commerce is “the performance of commercial activities by individuals and organizations based on the transfer of digital data including text, sound and visual images”4.
The High Council of Science and Technology (“HCST”) formed a working group to promote and extend electronic commerce in Turkey at its meeting on August 25, 1997, and the Electronic Commerce Coordination Board (“ECCB”) was created within this framework.5. The ECCB, on the other hand, defines electronic commerce as “the whole of the commercial transactions of individuals and organizations aiming to create a value by processing, transmitting and storing digital information in the form of text, sound and images on the internet or internet environments”6. In addition to the boards such as HSCT and ECCB that work to develop electronic commerce, the Law No. 6563 on the Regulation of Electronic Commerce was adopted by the Grand National Assembly of Turkey (“GNAT”) on October 23, 2014 and entered into force on May 1, 2015 after being published in the Official Gazette No. 29166 on November 5, 20147.
The growth of electronic commerce has been influenced by a wide range of other advancements. The development and spread of information technologies consisting of products such as computers and the internet, as well as globalization, contributed to the development and rapid growth of electronic commerce8. There are several electronic commerce technologies available at the same time, including the phone, television, and computer. Thanks to these tools, audio and video transmission is carried out without time and place limits, and commercial transactions are realized in a shorter time9.
As electronic commerce has become increasingly widespread in the world, many positive and negative effects of electronic commerce have emerged. With the increase in electronic communication, access to producers, consumers and businesses has become easier; it is now simpler for consumers to access the global market, speed and diversity have risen, and competitiveness has grown as a result of the decline in costs associated with manufacturing, marketing, and distribution operations in the electronic environment. Electronic commerce has negative sides as well as positive sides. The widespread use of electronic commerce has led to the elimination of certain elements of traditional commerce, which has resulted in a surplus of labor and increased unemployment10.
III. ELECTRONIC COMMERCE IN TURKISH LEGISLATION
In 2008, the “Electronic Commerce Directive Working Group” was established with the contribution of the Undersecretariat of Foreign Trade and relevant organizations in order to establish a legal infrastructure for electronic commerce in Turkey. The said group started to work on the preparation of an electronic commerce law and prepared the “Draft Law on the Regulation of Electronic Commerce” in 2010. Accordingly, the Law on the Regulation of Electronic Commerce was adopted by the Turkish Grand National Assembly in 2014 and entered into force in 2015. In this article, the Regulation prepared on the basis of the Law on the Regulation of Electronic Commerce will be evaluated11.
IV. REGULATION ON ELECTRONIC COMMERCE INTERMEDIARY SERVICE PROVIDERS AND ELECTRONIC COMMERCE SERVICE PROVIDERS
A. Purpose of the Regulation
When the Law on the Regulation of Electronic Commerce, which constitutes the basis for the preparation of the Regulation, was prepared, it was aimed to expand electronic commerce, and in line with this purpose, firstly, it was aimed to ensure that users trust the electronic commerce system. The basic requirement for ensuring the trust of the users or consumers in electronic commerce is to ensure transparency and accessibility12. Therefore, taking into account the needs for regulation, transparency, and accessibility, the duties of electronic commerce service providers (“ETSP”) and electronic trade intermediary service providers (“EISPs”) have been regulated. It is aimed to prevent unfair practices of EISPs such as late payment, forcing the supply of goods or services from a certain person, charging a fee to sellers without providing a service, and unfairly highlighting ETPS’ own branded products.
B. New Definitions
In addition to the definitions under the Repealed Regulation, the Regulation introduces several new definitions and expands the scope of some definitions. Some of these definitions are as follows:
1. Electronic Trade Intermediary Service Provider (EISPs)
Pursuant to subparagraph 4/1(f) of the Regulation titled “Definitions”, an EISP is defined as an intermediary service provider that enables the execution of contracts or placing orders for the supply of goods or services of ETSPs in the electronic commerce marketplace. In this context; (i) mediumsized EISPs are defined as ETSPs whose net transaction volume in a calendar year is over TRY 10.000.000.000.000 (ten billion Turkish Liras), (ii) largescale EISPs are defined as EISPs whose net transaction volume in a calendar year is over TRY 30.000.000.000. 000 (thirty billion Turkish Lira) and the number of transactions, excluding cancellations and returns, is over one hundred thousand, and which also fulfills the obligations set forth in the Regulation for mediumsized EISP; (iii) very largesized EISP is an EISP whose net trading volume in a calendar year exceeds 60. 000.000.000.000 TL (sixty billion Turkish Lira) in a calendar year and the number of transactions excluding cancellations and returns is over one hundred thousand, and which also fulfills the obligations specified in the Regulation for medium and largescale EISP.
2. Electronic Commerce Service Provider (ETSP)
Pursuant to Article 4/1(h) of the Regulation titled “Definitions”, an ETSP is defined as a service provider that concludes contracts or takes orders for the supply of goods or services in an electronic commerce market place or in its own electronic commerce environment. In this context; (i) medium sized ETSP is defined as an ETSP whose net transaction volume in a calendar year exceeds 10.000.000.000.000 TL (ten billion Turkish Liras) and the number of transactions excluding cancellations and returns is over ten million, (ii) large scale ETSP is defined as an ETSP whose net transaction volume in a calendar year exceeds 30.000.000.000. 000 (thirty billion Turkish Lira) and ten million transactions excluding cancellations and refunds in a calendar year and which also fulfills the obligations specified in the Regulation for medium sized ETHSs, (iii) very large sized ETSP is defined as an ETSP with a net trading volume of more than 60.000.000.000.000 TL (sixty billion Turkish Lira) and ten million transactions excluding cancellations and refunds in a calendar year and which also fulfills the obligations specified in the Regulation for medium and largesized ETSPs.
3. Intermediary Service
Pursuant to Article 4/1(b) of the Regulation titled “Definitions”, intermediary service is defined as any service provided by the electronic commerce intermediary service provider to the electronic commerce service provider or the buyer in the electronic commerce marketplace for the purpose of realizing electronic commerce transactions and delivering the order.
4. Electronic Trade Information System (ETBIS)
In Article 4/1(g) of the Regulation titled “Definitions”, the electronic commerce information system is defined as the information system created by the Ministry of Trade for the purpose of registering ETSP and EISPs, collecting electronic commerce data, processing this data and generating statistical information, and enabling registration and notification under the Law on the Regulation of Electronic Commerce.
C. Obligations
1. Obligations of the Electronic Commerce Service Provider
a. Obligation to Provide Informa - tion
Article 3 of the Law on the Regulation of Electronic Commerce states that service providers are obliged to provide information on introductory and technical steps, information on confidentiality rules, and information necessary for the correction of errors in data entry. In the Regulation, the obligation to provide information is explained in more detail and the information that must be provided in full is regulated in order. Therefore, the trade name, central registry registration system (MERSIS) number and headquarters address for merchants, name and surname, tax identification number and headquarters address for tradesmen and craftsmen, registered electronic mail (KEP) address, electronic mail address, telephone number and, if any, business name and registered trademark, the professional chamber to which it belongs, the code of conduct related to the profession and the information on how to access them electronically are included within the scope of the information that the ETSP must keep in its electronic commerce environment.
The telephone number, central address, and email address must all be provided to EISP by the ETSP. If any of these details change, ETSP must notify EISP by the end of the day after the change.
b. Order Related Obligations
Pursuant to Article 4 of the Law on the Regulation of Electronic Commerce, the service provider is obliged to ensure that the terms of the contract are clearly understood by the buyer at the stage of order confirmation and before entering payment information. In addition to the obligations imposed on the service provider under the Law on the Regulation of Electronic Commerce, another obligation added under subparagraph (a) of Article 8 of the Regulation obliges the ETSP to ensure that secondhand goods are sold by placing them in a different section and to show the total price, including tax and delivery costs, to the buyer before entering the payment information.
In this context, the ETSP is obliged to notify the buyer that the order has been received and the transaction has been made through the electronic commerce environment and by means such as electronic mail, text message or telephone call without delay.
2. Obligations of the Electronic Commerce Intermediary Service Provider
a. Verification Obligation
Pursuant to Article 6 of the Regulation, the EISP is obliged to verify the information of the ETSP through its electronic systems open to access, or in the absence of such systems, through the documents obtained from the ETSP. EISP will only be able to provide intermediary service to the ETSP whose information has been verified. In addition, the EISP is obliged to provide the ETSP with the necessary facilities to display and update the information that the ETSP is obliged to maintain.
b. Obligation to Provide Informa - tion
Article 6 of the Regulation stipulates that the trade name, central registry registration system (MERSIS) number and headquarters address for traders, name and surname, tax identification number and headquarters address for merchants and craftsmen, registered electronic mail (KEP) address, electronic mail address, telephone number and, if any, business name and registered trademark, the professional chamber of which it is a member, the rules of conduct related to the profession and information on how to access them electronically are among the mandatory information that the EISP must keep in its electronic commerce environment.
c. Order Related Obligations
Article 8 of the Regulation obliges EISP to ensure that secondhand goods are sold by placing them in a different section and to show the total price, including tax and delivery costs, to the buyer before payment information is entered.
In addition, the EISP is obliged to notify the buyer of the receipt of the order and the execution of the transaction without delay through the electronic commerce environment and by means such as electronic mail, text message or telephone call.
d. Obligations Regarding the Internal Communication System
Article 18 of the Regulation obliges EISP to establish an internal communication system to receive the applications made by the ETSP’s to which it is obliged to provide intermediary services and to conclude the applications made through this system within fifteen days. Pursuant to Article 35/a of the Regulation, this provision will enter into force on July 1, 2023.
e. Restriction on EISP’s Inability To Offer Its Brands For Sale
Pursuant to Article 19 of the Regulation, EISP will not be able to offer for sale or mediate the sale of goods bearing its own trademarks or those of its affiliated persons in electronic commerce marketplaces. Goods belonging to brands that generate more than half of the total revenue from sales outside of electronic commerce, periodicals such as magazines and devices that allow reading and listening to digital copies of electronic books are excluded from Article 19.
D. Illegal Content and Unfair Commercial Practices in Electronic Commerce
1. Illegal Content
Article 10 of the Regulation states that in the event that unlawful content is provided by the ETSP, the EISP is not held liable for the use and existence of such unlawful content, unless otherwise stipulated. Counterfeit products and content that infringes the rights of trademark rights, industrial designs, intellectual and artistic works belonging to others are considered as unlawful content within this scope. As a matter of fact, pursuant to Article 9 of the Law on the Regulation of Electronic Commerce, in the event that there is an unlawful content in the content offered, the intermediary service provider is not responsible for the unlawful content, unless otherwise stipulated. As regulated in Article 10/2 of the Regulation, the responsibility of the EISP regarding unlawful content consists of removing the content in question within fortyeight hours from the moment it becomes aware of it and notifying the ETSP and the relevant institutions and organizations of the unlawfulness.
2. Unfair Commercial Practices
Additional Article 1 of the Law on the Regulation of Electronic Commerce and Article 11 of the Regulation prohibit unfair activities within the scope of electronic commerce.
Practices that significantly impair the commercial activities of ETSP, impair its ability to make a reasonable decision or force it to decide, or cause it to become a party to a commercial relationship to which it would not normally be a party, have been recognized as unfair.
The Law on the Regulation of Electronic Commerce regulates which situations are considered unfair commercial practices. In the Regulation, in addition to the situations deemed unfair commercial practices in the Law on the Regulation of Electronic Commerce, two more situations have been added. Accordingly, determination of the right of withdrawal periods above the periods specified in the Law No. 6502 on the Protection of Consumers without obtaining the prior approval of the ETSP and making misleading statements by the EISP to the ETSPs about its products and activities that do not reflect the truth are considered unfair commercial practices.
E. Violation of Intellectual and Industrial Property Rights
Article 12 of the Regulation regulates the procedure for filing a complaint against infringement of intellectual and industrial property rights. Complaints may be filed to the EISP by the ETSP whose product has been withdrawn from publication via notary public or registered electronic mail (REM).
EISP is obliged to remove the product subject to the complaint from publication within fortyeight hours at the latest upon receipt of the complaint application and to notify ETSP and the right holder.
A complaint is the remedy to be applied against the violation of intellectual and industrial property rights. In this context, the objection may be filed to EISP by the ETSP whose product has been removed from publication via internal communication system, registered electronic mail (REM) or notary public. EISP will not process objection applications that do not include the issues specified in Article 13. In the event that the ETSP is found to be justified in its complaint, the EISP shall republish the product and notify the right holder and the ETSP within twentyfour hours at the latest upon receipt of the appeal.
F. Intermediary Agreement
Within the scope of the intermediary agreement, the conditions of the commercial relationship between the ETSP and the EISP are determined by a written or electronic agreement. Article 15 of the Regulation sets forth the minimum elements of the intermediary agreement regarding the information on the intermediary service provided to the ETSP, restriction, suspension and termination of the intermediary service.
Furthermore, some additional elements required to be included in the intermediation agreements to be executed by medium, large and very largescale EISP are listed in Article 15/2 of the Regulation. Accordingly, the information stating that the ETSP can transfer the data listed in Article 21/c of the Regulation efficiently and without charge, and that the required technical facilities will be made available to access such data throughout the duration of the intermediation agreement, as well as the information stating that the ETSP will fulfill requests for data access and transfer within fifteen days by anonymizing the recipient information, are among the information.
Notifications regarding amendments to the intermediation agreement are made by EISP to ETSP. Pursuant to Article 16/2 of the Regulation, the amendments are put into effect within fifteen days following the date of notification. The fifteenday window is increased to thirty days in situations where the ETSP is required to make technical improvements, commission rates and other service fees are raised, intermediary services are restricted, suspended, or terminated, the ETSP is subjected to new legal sanctions, and the balance of rights and interests shifts against the ETSP. The ETSP has the right to terminate the intermediary agreement without compensation before the expiry of the thirtyday period, provided that the notification is made via the internal communication system.
As regulated in Article 17/1 of the Regulation, EISP cannot restrict, suspend or terminate the intermediation service, except in cases where the objective criteria set out in the intermediation agreement are met. In case of circumstances requiring the restriction, suspension or termination of the intermediary service, EISP requests the ETSP to provide a clear and comprehensible explanation with in at least three business days; if the explanation is insufficient, the intermediary service may be restricted, suspended or terminated by notifying the ETSP within seven business days from the date of receipt of the explanation or at the end of the three business days given for the explanation if the explanation is not provided. The intermediary agreement is deemed to be terminated as soon as the notification is made to the ETSP.
In the event of restriction, suspension or termination of the intermediary service, ETSP is obliged to continue business and operations only for its existing orders.
G. Electronic Trade License
Article 30 of the Regulation stipulates that largescale and very largescale EISP, and medium, large and very largescale EISP, whose net transaction volume in a calendar year is more than 10.000.000.000 TL (ten billion Turkish Lira) and whose number of transactions excluding cancellations and returns is more than one hundred thousand, and ETSP that obtains more than half of its to tal sales revenue from electronic commerce sales, must obtain a license from the Ministry of Trade and renew its license in order to continue its activities.
The application for obtaining and renewing a license is made through the Electronic Trade Information System (“ETBIS”) by paying the fee in advance. ETSP and EISP, which are in the application process, can continue their electronic commerce activities during this period and the application process must be finalized within fifteen days.
The license fee to be paid and how the monetary thresholds will be calculated are stipulated in detail in Article 31 of the Regulation. These provisions will enter into force on January 1st, 2024 pursuant to Article 35/c of the Regulation.
H. Other Provisions
Article 20 of the Regulation states that it is not possible for an ETSP or EISP to engage in marketing and promotional activities in online search engines by placing advertisements on keywords consisting of registered trademarks that exclusively constitute the main element of domain names registered in ETBIS of persons with whom it is not in economic integrity without obtaining their affirmative declaration of will in advance.
Medium, large and very largescale EISPs are obliged to comply with the procedures and principles set out in Article 21 of the Regulation when using the data obtained, and the provision will enter into force on January 1, 2024 pursuant to Article 35/c of the Regulation.
Articles 28 and 29 of the Regulation regulate the advertising and discount budget. It is stipulated that the advertising budgets of EISP and ETSP shall be restricted in order to eliminate the negativities caused by excessive advertising activities using all kinds of tools. Pursuant to Article 29 of the Regulation, the costs incurred by the EISP on behalf of the buyers and ETSPs, and the costs incurred by the ETSP on behalf of the buyers, promotions, awards, points, coupons, gift vouchers and similar opportunities provided to them, and other economic benefits are considered within the discount budget.
According to Article 26 of the Regulation, EISP will not be able to engage in goods transportation, transportation organizer, postal service provider activities, except for the sales in which EISP provides intermediary services, sales as an ESTP and sales other than electronic commerce, and this regulation will enter into force on January 1, 2024.
All other provisions of this Regulation not specifically mentioned in Article 35 shall enter into force on January 01, 2023.
V. CONCLUSION
With the Regulation, many important definitions that were not included in the repealed Regulation on Service Providers and In termediary Service Providers in Electronic Commerce, the relationship between ETSP and EISPs and the obligations they must comply with, the obligations of ETSP and EISPs in case of unlawful content and unfair commercial practices, the measures to be taken to prevent violations of intellectual and industrial property rights, the definition of the intermediary agreement and the cases of restriction, suspension, termination, the application processes for obtaining and renewing an electronic commerce license, the advertising and discount budget to prevent excessive activities, and the effective dates of the provisions in the Regulation are included. The Regulation aims to address the scope of the developments in electronic commerce as a result of the development of technology day by day and to act in harmony with these developments.
BIBLIOGRAPHY
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FOOTNOTE
1 Gazanfer Erbaşlar/ Şükrü Dokur, Electronic Trade E-Commerce, 2nd Edition,Ankara 2012, p. 3.
2 Neslihan Coşkun, “Basic Dynamics in the Development of Electronic Commerce and Barriers to its Development”, Çukurova University Journal of Institute of Social Sciences, C. 13, S. 2, Adana 2004, p. 243-245.
3 Caner Delitay, Electronic Commerce: Evaluation of Turkey in Terms of Export, Master Thesis, Ankara 2020, p. 3, ASO, Asomedya, Ağustos 1998, p. 29.
4 Delitay, s. 3’ten naklen, Çak, M. Electronic Commerce and Taxation in the World and Turkey, ITO Publications, İstanbul 2022, p. 76.
5 Delitay, s. 47’den naklen, ekonomi. gov.tr.
6 Erbaşlar/ Dokur, p. 4.
7 Delitay, p. 52.
8 Coşkun, p. 256.
9 Önder Canpolat, E-Commerce and Developments in Turkey, Report of the General Directorate for the Protection of Consumers and Competition, Ankara 2001, p. 14.
10 Canpolat, p. 21-22.
11 Mehmet Demirdöğmez/ Nihat Gültekin/ Hacı Yunus Taş, “The Development of E-Commerce Sector in Turkey by Years”, OPUS-International Journal of Community Research, C. 8, S. 15, 2018, p. 2223.
12 Lütfü Başöz/ Ramazan Çakmakcı, The Law on the Regulation of Electronic Commerce and Related Laws with Reasons, Commission Reports and Minutes of the Grand National Assembly of Turkey, 1st Edition, Istanbul 2015, p. 9.
