MEP Zammit Dimech strikes deal on new regulation protecting SMEs

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MEP Zammit Dimech strikes deal on new regulation protecting SMEsMEP Francis Zammit Dimech has said that customers will gain from wider choice and best deals online, after he struck a deal on new regulations protecting SMEs.

The European Parliament and the Council of the EU reached a political agreement early on Thursday morning on a new regulation ensuring fair and transparent online environment for businesses using online platforms to reach their customers.

The MEP said that he had consulted with stakeholders in Malta over the past weeks to ensure that the regulation reflects the challenges and aspiration of SMEs, the hospitality sector and customers.

Zammit Dimech was the Rapporteur and led the negotiations on behalf of the Committee on Legal Affairs that together with the Committee on Internal Market and Consumer Protection was responsible to represent the European Parliament during negotiations.

“This is an important milestone for Maltese SMEs, it provides protection from big giants and ensures fair competition online including when accessing cross-border consumer markets,” said Zammit Dimech, reacting after concluding the fourth trialogue.

He added, “it is also an important goal for customers such as those who book a hotel or a flight online. This regulation ensures that customers truly get the best value deals when searching for products and services online.”

“Similar to trends across the EU, online platforms in Malta are on the rise and that highlights the importance of this regulation,” Zammit Dimech said, “Contracts in the sector between platforms and businesses must be guided by the principles of fairness and good faith.”

Zammit Dimech recalled how up till this week, shop owners selling online had spoken to him about unfair practices.

“The regulation will provide legal certainty for a sustainable business environment online. This is critical to ensure no harm is caused to businesses and to promote trust in the online platform environment in the EU,” said the MEP.

During negotiations, Zammit Dimech said that he pushed to protect small businesses users from unfair practices by listing unfair trading practices which will no longer be allowed and cannot be made use of by platforms when dealing with business users.

He explained that he also ensured transparency in terms of ranking used by platforms and therefore the prominence given to products/services in search results ensuring there is no abuse of power by platforms or unfair competition.

“Data collected through platforms as a result of commercial activity of a business user is to be made available to the respective business. This is crucial for the hospitality sector and will ensure better service and facilitate targeted marketing,” the MEP added.

Francis Zammit Dimech concluded by saying that the legislation also provides various safeguards to SMEs including the right to be informed in case changes are made in the terms and conditions of platforms, and the possibility to terminate any agreement without any charge in case modifications done by the platform are detrimental to businesses. “The deal also improves the internal complaint-handling system calling for equal treatment of businesses without any harmful effects on businesses using the system.”

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