The national authorities involved in this project had different focus areas for the products they included in the project. Many of the products are regarded "high-risk"-products, like cheap electronics and cheap soft plastic products. For other categories of products, there is less risk to find restricted substances above limit, such as in textiles from reputable stores. There are also differences in which substances that has been targeted. As we see from the results, lead, cadmium, phthalates and SCCP are the substances more often found above restriction limit, but in some of the sub-projects reported here, these substances were not tested for. This will influence the results and is important to bear in mind, when analysing the findings. Generally, it is also important to highlight that our selection of products is not randomly chosen, but based on a risk approach and the results regarding non-compliance will therefore not represent a general selection of all products available on the market.
4.1 Dropshipping stores have the highest non-compliance rate
When comparing the different types of e-commerce stores (marketplaces, dropshipping stores and web shops), the non-compliance rate was highest for the dropshipping stores, with a non-compliance rate as high as 70%. As shown under the results chapter, the dropshipping stores included in the project were mainly located in the EU. However, it seems that the products they sell, come from sellers outside the EU, often through marketplaces ("dropshipping suppliers"). The national authorities' impression is that the dropshipping stores believe that they are not responsible for the products they sell, and hence, also not for product safety. The majority of the actors not removing the products from the web page after written advice from the authorities, were dropshipping stores, which underlines this impression.
As explained in chapter 2 it is easy to set up a dropshipping store by using an e-commerce platform, and in many cases, it turned out that in some cases private individuals were behind the dropshipping stores. In other cases, it was not possible to find a responsible actor behind the websites at all. Some sites also disappeared/shut down by its own during the project. In this project, none of the authorities looked into the possibility of restricting access to the web page in accordance with article 14 in the market surveillance regulation ((EU) 2019/1020). Neither did we check the obligations to have an economic operator in the EU (article 4).
As highlighted in chapter 2.3.3, national enforcement authorities in this Nordic project, consider dropshipping store as the responsible economic operator, and therefore responsible for the product safety of the products they are selling either in their capacity of being importers or distributors. Dropshipping needs to be explored further by the authorities. The Nordic enforcement group will look specifically into this issue in more detail in an upcoming project next year.
4.2 More non-compliant products from non-EU countries
The results show clearly that products bought from outside the EU has a higher risk of non-compliance, as compared with the products bought from within the EU. The non-compliance rate for the non-EU companies was 66%. For EU-based companies, the non-compliance rate was 37%. This is comparable to the results in the Nordic e-commerce project in 2019/20 where the non-compliance rate was 78% and 32% for similar product categories for non-EU companies and EU-based companies, respectively (Nordic Council of Ministers, 2020).
Note that the dropshipping stores we included in this project are mainly situated in the EU, and the products bought from these stores are regarded as from within EU, although the products probably originate from non-EU sellers. Also, products bought from national marketplaces were accounted for as from within the EU, although the sellers may be from non-EU countries, and in this case, should have been regarded as non-EU products.
Products from non-EU countries which are directly sent to consumers are difficult for the national authorities to control. The national authorities have no jurisdiction against actors outside the EU. The marketplaces and dropshipping stores need to strengthen their proactive work.
The consumers need to be aware of these new developing business models and the risk they may pose to consumers. Consumers should take precautions in who they are buying from. In the report on this topic from KEMI, advice is given to companies and consumers (Swedish Chemicals Agency, 2023).
Market surveillance authorities need to explore further the possibility for enforcement within the new Market Surveillance Regulation and also, future requirements in the Digital Services Act and the General Product Safety Regulation. These new regulations will hopefully put pressure on the actors and contribute to improved legal compliance.