In June 2013, the French National Commission on Information Technology and Liberties (Commission Nationale de l’Informatique et des Libertés, “CNIL”) announced that, following a question of Member of European Parliament Françoise Castex, it was going to investigate IP Tracking practices that e-commerce sites allegedly used to illegitimately increase their prices. This investigation was carried out in close connection with the French Directorate General for Competition Policy, Consumer Affairs and Fraud Control (Direction Générale de la Concurrence, de la Consommation et de la Répression des Fraudes, “DGCCRF”). In January 2013, MEP Françoise Castex had already alerted the European Commission about this alleged unfair commercial practice. The Commission concluded that national authorities in charge of protecting personal data were competent as the IP address is personal data.
The allegation was that some French e-commerce websites selling train or plane tickets would use IP tracking to keep the IP address of internet users who visit their websites to check the prices of some tickets but without buying them. When the same users subsequently visit these websites, the prices of the tickets would be automatically increased as the website would recognise their IP address. If this practice was proven to be true, it would create issues in terms of not only protection of personal data but also unfair commercial practice.
On 27 January 2014, the CNIL and the DGCCRF published a press release about the preliminary results of their investigation. The CNIL and the DGCCRF did not find unfair commercial practices by which the prices of the tickets would vary depending on the IP address of the internet user. However, they did notice other commercial practices as a result of which the prices were increased based on other criteria. For instance, some websites change the prices of the tickets based on the number of seats left or on the date of purchase. Some other websites change the booking fees depending on the time of the day when the ticket is bought, the booking fees being less expensive during off-peak hours. Finally, other websites change their prices depending on the website that was visited by the internet user right before. For instance, users coming from a price comparison website would be offered tickets for a lesser price but their booking fees would be increased so that the overall price would remain the same.
The CNIL and the DGCCRF conclude that some commercial practices are used by French e-commerce websites to modulate their prices but none are based on the IP address of the user. As a result, they will continue their investigation to assess the compliance of some of these commercial practices with the laws protecting personal data and protecting consumers against unfair commercial practices.
This post was written by Hogan Lovells Partner Christine Gateau and Associate Pauline Faron, who are members of the Litigation Practice Group in our Paris, France office. This entry was cross-posted on our Global Media and Communications Watch blog.