Italian and European e-commerce regulations: what are the rules?

E-commerce is becoming more and more widespread and online sales are rising rapidly. A study by Netcomm in collaboration with the Politecnico di Milano estimates that consumer sales in 2023 will exceed the 45 billion euros of 2022, which had already seen a 14% rise compared to the previous year.

The business prospects for e-commerce are more than positive. However, every kind of online sales activity must comply with more than one regulation governing e-commerce at the Italian and European level.

In this article, we'll explore the e-commerce code in force at the national level and in the European Union, so as to understand how to operate within the law, avoid heavy penalties, and protect both consumers and retailers.

Here's the table of contents with what we'll analyze:

• Italian e-commerce regulations

• European e-commerce regulations

• Penalties for those who violate e-commerce regulations

• How to be compliant

• An integrated solution for your e-commerce

Italian e-commerce regulations

Although opening an online sales business may seem easier than a physical store, in our country there are very precise rules to follow if you plan to receive online transactions.

These obligations apply equally to all the different parties in the commercial relationship, that is:

• Business to Consumer (B2C)

• Business to Business (B2B)

• Business to Administration (B2A)

• Consumer to Consumer (C2C)

As well as for every type of service and good offered online:

• indirect e-commerce: selling physical products and material goods for which delivery is provided in the traditional way (that is, via carriers) to a physical point in the territory;

• direct e-commerce: cases in which the execution of the contract happens entirely online. It includes the buying and selling of intangible goods and IT services (for example, software or services downloadable from the web).

In Italy, online buying and selling relationships are mainly regulated by two measures:

1. Legislative Decree no. 70 of 9 April 2003, the so-called "E-commerce Decree", which provides for the Italian implementation of the European Directive on e-commerce.

2. The Consumer Code issued in 2005 to collect all the regulations that safeguard the consumer and establish fundamental rights and rules to consider in the online contract.

Let's discover them in detail.

1. E-Commerce Decree

E-commerce regulation governs the matter of e-commerce activities, defining them as: "the offer of goods or services made by a provider through the use of electronic communication networks".

The decree's objectives are mainly two:

1. to promote the free circulation and exchange of goods and services in the information society through IT technologies;

2. to practice the principle of fairness in exchanges to protect consumers from any fraud and ensure they make informed decisions.

The decree establishes some legal obligations for online sellers, including:

• providing the consumer with complete, clear, and detailed general information on the price, the product's or service's features, delivery times and costs, and payment and delivery methods;

• ensuring the security of the consumer's data, adopting the measures needed to prevent unauthorized access to personal information;

• making a withdrawal form available to the consumer within 14 days of the product's delivery, guaranteeing the ability to return the product and get a refund of the price paid.

In addition, for e-commerce activities that involve advance payment, the E-commerce Decree requires providing the consumer with written confirmation of the order placed.

This confirmation must contain all the information about the product or service purchased and the payment method chosen (via credit cards, electronic payment systems, cash on delivery, or bank transfers).

2. Consumer Code

The Consumer Code is made up of 170 articles that legally regulate and organize aspects such as:

• the essential information to specify on the e-commerce site;

• the obligations to comply with in commercial communications, including limitations;

• the rules of distance contracts, like the information the retailer must give the buyer before they actually complete the transaction and are bound by the purchase.

European e-commerce regulations

At the European level, the reference e-commerce regulation for governing online exchanges between member states is Directive 2000/31/EC of 8 June 2000, known as the E-commerce Directive.

This directive aims to harmonize the rules of European Union member countries on e-commerce, in order to promote the free movement of online services.

It establishes some fundamental principles that guide this form of distance commerce, including:

• the principle of the free provision of services, which provides for the ability of an online store to sell abroad in any European Union country without having to comply with further administrative requirements.

• The protection of personal data and compliance with the regulations for processing users' and customers' data.

• Equal access to goods and services within the EU, which prohibits platforms from redirecting customers of a different nationality from the e-commerce to interfaces that present, for example, the same items at different prices.

• Non-discrimination of the various payment methods chosen by the customer.

• The principle of limited liability of intermediary service providers, which provides that intermediary service providers (like hosting providers, ISPs, search engines) aren't responsible for the content spread by their users, unless they're informed of the illegality of such content and don't act promptly to remove it.

• The information principle, which requires online sellers to provide the consumer with clear, transparent, correct, and complete information on payment methods, prices, promotions, deliveries, returns management policies, and warranties.

The European Directive particularly insists on the need to inform users clearly and understandably about:

• the accepted payment options;

• the seller's identity, details, and contact information;

• the features of the products or services for sale;

• shipping, delivery, and return policies (right of withdrawal);

• prices and any additional costs borne by the consumer (taxes, delivery costs, etc.).

In addition, the E-commerce Directive requires online sellers to designate a legal representative within the European Union, who can represent the seller before national supervisory authorities.

But there's another fundamental principle regarding European and Italian e-commerce regulation: the protection of online buyers in B2C channels.

Protecting online consumers' rights

The rules governing online sales have as their main goal the protection of the rights of consumers who buy online, guaranteeing them maximum transparency and security in transactions.

At the base of these protections is the Consumer Code, which over the years has been flanked by a series of Italian legislative decrees and EU directives with increasing protections for those who buy goods or services online.

Among the most important protections guaranteed to consumers are, for example:

• the right of withdrawal within 14 days of the product's delivery;

• the guarantee of conformity of the goods;

• the ability to obtain a refund in case of unauthorized payment.

Penalties for those who violate e-commerce regulations

Those who breach e-commerce regulations can incur penalties, both at the national and European level.

In Italy, the law on the matter is constantly evolving and, to date, provides monetary penalties that can range from about 250 euros, to million-euro fines, to percentages of turnover depending on the violations committed.

Among the infractions that can cost sellers dearly, we can mention:

• non-compliance with the rules on consumer information,

• failure to indicate the information on the right of withdrawal;

• violation of personal data protection.

• failure to publish the VAT number on the site;

• omission of the privacy notice or its incorrect insertion;

• unfair or hidden advertising toward an audience of minors;

• insertion of unfair clauses in the terms and conditions of online services;

• non-transparent handling of price reductions and sales;

• publication of false online reviews.

The highest penalties are those imposed by the AGCM (Italian Competition Authority), in case the company has carried out an unfair commercial practice by breaching the information obligations toward users provided by the e-commerce code.

These penalties can add to the equally high ones (up to 4% of turnover) given by the Data Protection Authority in case the site violates cookie regulations and the GDPR.

As for Italian sellers who decide to ship abroad in Europe, EU Directive 2000/31 provides monetary penalties also for those who provide intermediary services that don't adopt measures to remove the illegal content spread by their users. Or that don't respect the protections provided for consumers. These penalties can reach up to 10% of the intermediary service provider's global annual turnover.

How to be compliant

To make sure you're compliant with all the regulations, check that your shop meets the points listed below:

Footer showing the seller's identity

A section to structure carefully is the footer, which is visible from every section of the site and, to avoid even very high monetary administrative penalties, must contain information such as:

• seller details (name, VAT number, registered office, email and phone contact, paid-up share capital, REA number)

• link to the General Terms of Sale

• link to the Privacy Notice and the Cookie Policy

• Accepted payment systems

• Ways to contact the shop

• In the case of online pharmacies, information on the professional association of membership.

• Withdrawal, warranty, and e-commerce shipping policies.

Mandatory information in product pages

Every product page too must comply with information obligations, indicating:

• a description of the product for sale. This varies by product, but generally includes the materials or ingredients of the composition, available colors, models, sizes.

• The price and conditions of sale.

• Whether or not it's available in stock.

• In case of a discount: the initial price, the discount applied, and the final discounted price;

• The wording: "VAT included".

The price must be shown inclusive of taxes and duties, and the product page must contain a summary of the withdrawal policies and delivery costs.

General Terms and Conditions of Sale

The General Terms of Sale represent the legally binding agreement between seller and buyer. They must therefore be easily accessible on the site and contain some mandatory information regarding:

• the process to follow to complete the sales contract;

• how to store and access the completed contract;

• means available to users to correct any data-entry errors before submitting the order;

• any codes of conduct;

• the languages available for the contract (in addition to Italian);

• the tools to resolve disputes.

E-commerce stores that target B2C consumers are also required to display some other content here:

• rates inclusive of taxes

• shipping, delivery, and other additional costs;

• delivery and payment methods;

• conditions for exercising the right of withdrawal

• the deadline by which one commits to delivering the goods;

• legal guarantee of conformity.

Privacy policy and cookie policy

The privacy notice must contain information about the e-commerce owner and the ways of processing and protecting data established by the European General Data Protection Regulation (GDPR).

The GDPR requires that the following be clearly indicated:

• the identity of the data controller;

• the data protection officer, or DPO;

• the contact details to reach them;

• the types of data collected;

• the method and purpose of processing;

• the legal bases;

• how long they'll be kept,

• the third-party providers to whom they'll be communicated;

• users' rights (access, rectification, erasure, etc.).

This data can be used only for the purposes to which the person has given consent and only when necessary.

The cookie policy informs the user about the cookies and other tracking and profiling tools used by the online shop. Cookies are divided into

• technical: to optimize the use of the site;

• profiling: to understand tastes and habits;

• first-party: set by the website that uses them;

• third-party: set for a different site.

When profiling cookies are used, the site must present a cookie banner to collect informed consent for their use, possibly including third-party ones.

According to the most recent measure of the Data Protection Authority on the matter, the cookie banner must be set to deny all cookies except technical ones, and must contain:

• a short notice;

• a link to the full Cookie Policy;

• a button to reject non-technical cookies or other tracking tools.

Also, it's important to keep in mind that neither cookie walls nor page scrolling are allowed as methods of acquiring consent.

Advertising and email marketing

Commercial communications must contain, clearly and unequivocally, from the first send onward, a specific notice. E-commerce regulation requires that:

• it be indicated (for example in the email footer) that it's advertising or a commercial communication;

• on whose behalf it's carried out;

• the conditions for accessing prizes, promotions, gifts, discounts be defined;

• if it's a promotional contest, what the conditions for participation are;

• a dedicated link to unsubscribe from the newsletter.

Before sending any marketing email, the merchant must obtain consent from the recipients and keep proof of it.

Checkout page

Making the e-commerce checkout process easier is important not only to increase conversions, but also to comply with online sales laws.

In the order summary, before payment, you need to add boxes that let the buyer confirm that they:

• accept the General Terms and Conditions of Sale;

• have read the Privacy Policy;

• consent to the processing of personal data;

• consent to receiving the newsletter.

The order confirmation email

A key element to issue as the order receipt, the confirmation email must state data such as:

• a summary of the items/services purchased with all the costs and the payment method;

• the right of withdrawal, if recognized;

• the conditions of sale (also in the form of an attachment to the confirmation email).

An integrated solution for your e-commerce

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Implement Sendcloud solutions in your e-commerce to:

• free yourself from manual workload;

• reduce data-entry errors;

• manage all logistics and customer-communication operations from a single place.

With Sendcloud you save time and money, which you can dedicate - among other things - to keeping up with the latest laws and regulations and adapting your business to every measure.

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