On 30 August 2023, the President of Ukraine signed Law of Ukraine “On Digital Content and Digital Services” No. 3321-IX (“Law”), designed to implement EU Directive 2019/770. The principal provisions of the Law enter into force on 2 March 2024.
Key provisions of the Law
- Scope. The Law applies to relations between the trader (acting directly or indirectly) and the consumer for the supply of digital content or a digital service. The Law provides a broad definition and includes a non-exhaustive list of digital content and services, including, for example, music files and computer programs. At the same time, the Law does not apply to certain services, which are regulated separately, including e-communications, financial and medical services.
- Trader’s duties. In addition to the requirements stipulated by e-commerce and personal data protection laws, the Law significantly strengthens the rights of consumers in the area of provision of digital content and services. This includes, in particular, the trader’s obligations to (1) ensure that digital content or a service meets certain objective and subjective criteria, including fitness for use in accordance with the purpose for which such service or content is usually used, and (2) inform the consumer of the need to update the software supporting the functioning of digital content or a service. In addition, the trader provides a guarantee to the consumer that the content or service does not violate third party rights, including intellectual property rights.
- Trader’s liability. The Law establishes the consequences of non-compliance with the Law depending on the type of violation. For example, for violation of consumer rights related to compliance of digital content or a service with certain criteria, the Law provides for a fine which can reach up to 300% of the value of digital content or a service. In certain cases, the consumer also has the right to demand that digital content or a service be brought into compliance with the terms and conditions of an agreement with the trader, demand reduction of price, reimbursement of money or may withdraw from an agreement.
By Mykola Stetsenko, Managing Partner, Yuriy Nechayev, Partner, and Oleksandr Kozhukhar, Associate, Avellum