Make online marketplace operators responsible for dishonest vendors

The Yomiuri Shimbun

13:00 JST, April 3, 2021

Online marketplaces have become an important foundation of our daily lives, but there have been cases in which consumers have had no choice but to put up with problems. It is only natural that operating companies that provide an arena for shopping online should be held responsible in cases of online shopping trouble.

According to the National Consumer Affairs Center of Japan, the number of consultations regarding online shopping in fiscal 2020 exceeded 260,000, an increase of more than 30,000 over the previous fiscal year. The center said there were many complaints such as, “I did not receive what I ordered,” or, “I was tricked into buying a fake product.”

In one reported case, problems arose over compensation after a mobile battery purchased from an online marketplace caused a fire in a house. Contact with the vendor was lost and the online marketplace operator did not respond appropriately.

With the widespread use of personal computers and smartphones, plus the effects of the novel coronavirus pandemic, online shopping will likely continue to increase in the future. Strengthening measures to protect consumers is an urgent task.

The current law focuses on the regulation of vendor companies, requiring them to display their names and addresses. If a malicious vendor makes a false representation, the company that operates the marketplace is not held directly responsible because it is positioned as merely the provider of the shopping platform.

This means that consumers cannot shop with peace of mind and it is difficult to eradicate problems. As long as the operators are earning profits through the sites, they should be required to play a certain role in avoiding and controlling problems by providing a safe environment for shopping.

The government has started a process to enact a new law to regulate marketplace operators. The bill submitted to the current Diet session imposes an obligation on the operating companies to make efforts to take appropriate measures so that consumers can smoothly contact vendor companies.

If counterfeit goods are offered for sale on an online shopping site, the government will be able to ask the marketplace operator to remove them.

However, the bill stopped short of including penalties in the event that the operators do not fulfill their obligations. Questions remain as to how effective such consumer protection will be.

After the bill is enacted, it is said the government will set up a public-private council consisting of marketplace operating companies and consumer groups to share information on malicious vendor companies.

While assessing the effects of the new law, discussions must be continued on how to effectively regulate the industry, including whether or not to introduce penalties.

The new law does not cover companies operating websites that mediate transactions between consumers. Given the significant scale of transactions on such sites, shouldn’t regulations to cover those companies be considered without delay?

It is also important for consumers to take measures to protect themselves. It is important for them to compare the consumer protection measures of major online marketplaces, check the product descriptions of the vendor companies and read reviews by other shoppers. Consumers should make sure they understand various matters before deciding to shop.

— The original Japanese article appeared in The Yomiuri Shimbun on April 3, 2021.