Argentine e-commerce providers cannot rely on the 'neutrality technology principle' when users are defrauded. Gustavo Atta reports
E-commerce businesses in Argentina were dealt a blow by a recent case in the country’s civil Appeal Court, when Mercado Libre -- an on-line platform similar to Ebay with some 66 million users, matching buyers and sellers in 12 countries -- was fined after the judge ruled it was an intermediary in the sales process and unable to rely on a defence of being simply a computer platform.
In the specific case, buyers acquired music concert tickets from the seller, who had advertised them on Mercado Libre. When the ticket-holders attempted to enter the concert venue, police arrested them on the grounds that the tickets had been previously reported as stolen.
The court ruled that Mercado Libre was liable in the same way as the seller for the damages caused to the buyers. In his ruling, the judge found that Mercado Libre was an intermediary in the chain of commerce and ordered both the seller and Mercado Libre to pay Arg$41.500 ($8,480) to the buyers.
The judgment generated profound debate among legal commentators because of its practical implications for on-line market operators and other internet-based intermediaries. It seems that internet service providers cannot rely on the ‘neutrality technology principle’ as an exemption from liability.
The court ruled that Mercado Libre could not be perceived simply as a computer platform. Indeed, it held in particular that as it obtained an economic benefit from the transaction, Mercado Libre must face the legal consequences.
In coming to its judgment, the Court applied article 40 of the Argentine Consumer Protection Act, which establishes that the manufacturer, distributor, supplier, seller, or the person who owns the trademark in the goods or service are all jointly liable for any damage caused to the consumer.