Recently the Italian Competition Authority (ICA) concluded two different investigation proceedings opened against the same trader (app provider), the first concerning unfair commercial practices and the second regarding unfair terms contained in the Terms of Use of the App.

Unfair Commercial Practices

In the first case the ICA considered that the trader forced its users to entirely accept the amendments made on the Terms of Use of the App concerning the sharing of some personal data of their account with another platform managed by the same trader in order to be used for advertising and commercial profiling purposes; in addition the trader has threated the interruption of the service in case of non-acceptance by users of above mentioned amendments.

According to the ICA this conduct represents an aggressive commercial practice since, by means of undue influence, it is likely to significantly impair the average consumer’s freedom of choice and thereby causes him/her to take a transactional decision that he/she would not have taken otherwise.

Moreover, such practice would be in contrast with the professional diligence that could legitimately be expected from a consumer communication services provider, since the Trader has not used such degree of correctness, proficiency and attention that could reasonably be expected from a trader of such importance.

Unfair Terms

The other investigation was aimed at ascertaining the potential unfair nature of some contractual clauses of the general terms and conditions applied by the Trader: terms that the consumer accepts downloading the app and creating his/her own account.

At the end of the proceeding the ICA has found the unfair nature of, and therefore has declared null and void the following clause:

  • exclusions and limitations of liability in favor of the Trader, also in case of its breach of contractual obligations;
  • possibility to unilaterally interrupt the service without reason or advance notice;
  • general right, granted only to the Trader, to terminate or withdraw from the contract in any moment and for any reason, not allowing the user to use the services;
  • general right of ius variandi (also of the economic condition) in favour of the Trader, without indicating the objective reasons and without establishing appropriate mechanisms to inform the consumer about them;
  • provision of the law of a foreign Country as exclusive applicable law to the contract;
  • provision of Courts of a foreign Country as exclusive venue for disputes resolution;
  • general right granted to the Trader to terminate "orders" and to not refund the user, without clarifying the contest, and lastly
  • predominance of the English version of the contract in case of conflict with the translated Italian one (which is accepted by users).

The above mentioned decisions are particularly relevant since they represent the first intervention of the ICA in the context of apps for mobile devices and, in particular, in the assessment, in term of compliance with the Italian Consumer Code, of the unfair terms contained in their relevant terms and conditions of use. Moreover, the clauses banned by the ICA often are standardized and conveyed in the terms and conditions of several apps as well as marketplaces.