Are online platforms intermediaries?

According to the court, online platforms such as Airbnb, Booking.com and Prijsvrij serve as intermediaries. What are the consequences for the platforms and the companies using them?

They have become part of our daily lives, websites such as Airbnb, Prijsvrij, Deliveroo or Booking.com. These and other websites actually function as a kind of online marketplace; they offer an online platform where sellers and buyers are connected by complex algorithms. Usually, such websites receive a (small) fee for providing this service, for example in the form of a commission per customer or a fixed monthly fee.

However, from a legal perspective, these online platforms raise a lot of questions. We have already posted a blog about the legal status of Uber drivers. Another question concerns the legal qualification of the relationship between a seller and an online platform where a service or product is offered. Because what are we actually dealing with here? Is it intermediation or something else entirely?

The answer to this question may have major consequences. Indeed, if the relationship between the online platform and the seller qualifies as an intermediary agreement, both the website (as intermediary) and the provider (as client) are bound by certain mandatory provisions. This could mean that the provider will have to pay a fee to the website if no one responds to the offer. On the other hand, the intermediary (online platform) does also have a duty of care towards the parties between it intermediates. The client can therefore call the platform to account for violating its duty of care.

Not surprisingly, the qualification of the relationship between the online platform and the seller has kept legal minds busy in recent years. In this blog, we will discuss this qualification in detail.

When is there an intermediary agreement?

An intermediary agreement must meet three requirements:

1. There is a contract for services.
2. The contractor acts as an intermediary on the basis of this contract.
3. The contractor is involved in the formation of one or more agreements.

Online platforms as intermediaries?

The question of whether the relationship between an online platform and a seller can be qualified as intermediation, was addressed, among other things, in the proceedings brought by the Travel Industry Pension Fund Foundation against the online platform Booking.com.

The Foundation took the view that Booking.com actually acted as an intermediary for holiday accommodation providers. As a result, Booking.com was obliged to participate in the pension fund. In this regard, the Foundation pointed out, among other things, that Booking.com receives a fee from accommodation owners for its activities, actively promotes the accommodation offered for an additional fee and handles the booking.

Booking.com disagreed, arguing that apart from facilitating it through a fully automated booking process, it had no role in the actual formation of the contract between holidaymakers and accommodation owners. On the part of Booking.com there were – and are – only a few automated administrative processing operations through the platform. Booking.com pointed out that, in fact, it is only an ‘online noticeboard’, or a service hatch. On its online platform, it offers potential holidaymakers a number of opportunities, which holidaymakers may or may not make use of. Both the court and court of appeal decided in favour of Booking.com.

However, the Dutch Supreme Court rules otherwise. According to the Supreme Court, there is indeed intermediation, because:

• Booking.com receives a fee for the contracts concluded through the platform.
• Booking.com’s business model is designed to create contracts between accommodation owners and third parties.

The extent to which Booking.com does or does not play an active role in the formation of these contracts, is, the Supreme Court ruled, not decisive. The activities performed by Booking.com in that context need not be comprehensive.

It can be inferred from the Supreme Court’s ruling that online platforms such as Booking.com or Airbnb, but also Deliveroo or Thuisbezorgd.nl, will quickly be considered intermediaries. This has been confirmed by subsequent judgments. The same pension fund that successfully sued Booking.com, did the same with the website Prijsvrij. Although the court found that in this case there was intermediation in travel, this was only a limited part of the website’s activities. Prijsvrij, therefore, could not be required to join the travel industry pension fund.

Airbnb, too, was an intermediary according to the Supreme Court. And in this case, too, there were no consequences for the platform. It concerned a consumer claim that the platform, as intermediary, was not allowed to request fees or commission from both the accommodation provider and tenant. In case of long-term rentals or sale there is indeed a ban on double commission, but that ban does not apply to short-term rentals.

Agency agreement?

Interesting, but theoretical for now, is the question of whether platforms, if they enter into an agreement with the provider with the intention of establishing multiple agreements between the provider and third parties for a longer period, can be considered agents. Formally, such arrangements are covered by the agency agreement. However, given the platforms’ resistance to being qualified as intermediaries, it is highly unlikely that they will claim to be covered by the considerably stricter agency arrangement regime. Clients will also be reluctant to grant commercial agent rights to platforms.

Contract and ICT lawyers

Does your company have a dispute with an online platform? Or with another intermediary or agent? Or are you an agent and looking for advice about your rights in relation to your client? Our specialists will be happy to help you. Please contact us: