The rise in popularity of electronically delivered items on eBay, Amazon, and other major online marketplaces is hardly surprising, given that the demand for software products, digital art, and eBooks has been at historic levels since the start of the decade.
Despite focusing predominantly on physical products, almost all online marketplaces offer a versatile selection of digital products.
Consequently, sellers who offer digital printables, OS software, and AI-generated templates on European online marketplaces must meet various product safety requirements.
Even though the General Product Safety Regulation (GPSR) applies to all types of digital products, sellers may still have a hard time determining the full scope of their responsibilities under this regulation due to the vague language in the document.
This article will help clarify the ambiguities regarding how GPSR affects the manufacturers and distributors of digital products on online marketplaces in the EU.
Key takeaways
- The GPSR mandates that all economic operators be responsible for the safety of the products they offer in the EU’s markets.
- Online sellers must include safety information with a digital product.
- Digital product listings must include the identification number and the contact details of the manufacturer and the EU Responsible Person.
- Manufacturers of digital products must conduct an internal safety analysis to ensure that their products comply with the product safety standards in the EU.
- Collaborate with market surveillance authorities and recall products deemed dangerous from online marketplaces in the EU.
How does GPSR affect digital products?
GPSR is harmonization legislation that replaces the General Product Safety Directive. As such, it introduces a uniform set of product safety standards applicable in the EU member states and the European Economic Area to strengthen consumer protection.
The document presents the guidelines for all economic operators acting on European marketplaces and offers the exact steps they must follow when bringing products into compliance.
However, Article 2 of the GPSR, which covers the scope of the regulation, doesn’t explicitly mention digital products. Instead, it only states:
This Regulation applies to products placed or made available on the market whether new, used, repaired or reconditioned. It does not apply to products to be repaired or reconditioned prior to being used where those products are placed or made available on the market and are clearly marked as such.’
Moreover, Article 6(a), which offers guidelines concerning risk assessment, indicates that economic operators must consider the product’s characteristics, such as design, composition, technical features, or packaging.
This section of the article clearly refers to physical products. Still, other sections of the article suggest that economic operators must also consider ‘cybersecurity features necessary to protect a product against external influences’ as well as ‘the evolving learning and predictive functionalities of the product’ when conducting the internal risk assessment.
Although it doesn’t specifically mention them, the GPSR document implies that economic operators should assess the safety of digital products to protect consumers against potential cybersecurity threats or the dangers of AI-based applications.
Further clarification of safety requirements for digital products
The European Commission has released an additional document that covers frequently asked questions about GPSR. The document sheds light on the aspects of the regulation that are left open for interpretation.
It explicitly states that stand-alone software isn’t among the products exempt from the GPSR in Article 2. However, the document also clarifies that the GPSR only applies to the safety aspects of software products.
Economic operators shouldn’t consider only the GPSR when assessing the compliance requirements their digital products must meet.
Other EU regulations and directives, such as the Digital Services Act (DSA), the Cyber Resilience Act (CRA), and the Product Liability Directive, are also among the regulations that lay out the safety requirements manufacturers of electronically delivered goods must meet.
Consequently, manufacturers and, in some cases, distributors of digital products are responsible for any physical or medical harm these products can cause to consumers.
Selling digital products on the EU’s online marketplaces after GPSR
Besides the GPSR and other EU regulations and directives, sellers must follow the guidelines for distributing digital products on online marketplaces.
Amazon, eBay, and other vast marketplaces with a strong presence in the EU have their own set of rules sellers must adhere to when listing electronically delivered goods in their stores.
For instance, retailers must become eBay-approved sellers of digital products and list their products in the Software or similar categories. Moreover, the sellers are subject to DSA, meaning eBay must make its business information available to buyers.
Understanding the guidelines for selling electronically delivered goods on online marketplaces
The rules for selling digital goods vary from one online platform to the next, so sellers must familiarize themselves with the platform’s guidelines for listing and delivering digital goods.
For example, Amazon sellers cannot upload PDF or MP3 files through their Seller Central accounts and sell them directly to consumers.
So, sellers who want to sell their eBooks or audiobooks on Amazon’s marketplaces must upload their content through Amazon Kindle Publishing or ACX, and then Amazon converts the files to the appropriate format.
Most importantly, retailers cannot sell video games or similar software products on Amazon if they’re not authorized distributors.
On the other hand, eBay has a more lenient policy that allows sellers to list video games in their stores, especially if the item is used, but offering new software products can still create legal challenges.
Furthermore, sellers who don’t have the status of eBay-approved sellers of digital products can only list digital goods in the Everything Else category in the Classified Ad format.
Compliance requirements for digital products under the GPSR
Regardless of their nature, all digital products entering the EU’s marketplaces must meet the same safety requirements.
Hence, sellers who offer NFTs, digital art, eBooks, or different software products must ensure that each product they add to their store is GPSR-compliant.
The path to compliance involves internal safety assessment, drafting technical documentation and safety warnings, translating the product documentation into the local market’s language, registering their business at the Safety Gate portal, and collaborating with the market surveillance authorities.
Moreover, sellers not established in one of the EU member states cannot act as the Responsible Person for their digital products and must appoint an authorized representative for those products.
Additionally, digital product listings on online marketplaces must contain a product identifier, such as the product’s serial number, images depicting the product, and contact information for the manufacturer and the EU RP.
It’s also important to understand that in the event of a product recall, the sellers are responsible for notifying national authorities and all customers who purchased a digital product from their store and offering a remedy.
Determining the responsibilities of online sellers offering digital products
Even though under the GPSR, all economic operators must only place safe products on EU marketplaces, their responsibilities depend on their position in the supply chain.
The regulation imposes the bulk of the responsibilities on the manufacturers, who are responsible for conducting the safety analysis and drafting the product’s technical documentation.
However, other service providers who alter a product they didn’t produce assume the responsibilities of manufacturers.
In the context of digital products, even including a video tutorial showing how to use a product safely could mean that the product’s distributor must assume the manufacturer’s responsibilities.
Consequently, designers, sellers offering pre-designed house plans, or creatives selling NFTs must determine whether they qualify as manufacturers, importers, or distributors to understand the scope of their responsibilities.
It’s also worth adding that distributors of digital goods on EU online marketplaces who aren’t based in one of the EU member states may have to appoint a responsible economic operator if the item’s manufacturer or importer hasn’t done so.
GPSR compliance for digital product sellers as a gateway to Europe’s expanding online marketplaces
Despite the regulatory hurdles GPSR introduces, the European Union remains one of the most lucrative online markets for digital products.
Europe’s digital content and consumer software markets are growing, which indicates that the demand for video games, operating systems, and various other software products will continue to increase in the foreseeable future.
Consequently, international sellers considering expanding to one of the EU’s online marketplaces can benefit from including digital products in their inventories.
Nonetheless, it’s paramount that sellers understand their responsibilities under the GPSR and ensure their products meet the safety requirements.
Are you searching for a solution that can help you expand your business to European online marketplaces or an EU Responsible person? Webinterpret can help! Schedule a call to find out how!
About Webinterpret
Webinterpret supports merchants selling on eBay.
Our AI-based solutions enable more effective selling through automated listing localization, advertising, and returns and ensure all products placed on EU markets are GPSR-compliant.
By giving your international customers a full, end-to-end local shopping experience, Webinterpret improves your conversion and helps establish your business globally.
