On 25 May 2016, and following an in-depth sector inquiry and consultation period, the European Commission (“EC”) published proposals for a set of new e-Commerce rules. The EC believes that this three-pronged strategy will benefit consumers and businesses alike by providing facilitated online buying and selling, increasing consumer protection through enforcement measures, and providing legal certainty for businesses. Additionally, the new rules are anticipated to enhance the functioning of Digital Single Market which, according to the EC, has the potential to contribute up to €415 billion to Europe’s annual GDP (when fully functioning).
In an attempt to further the advancement of the Single Market and the Digital Single Market objectives, the new rules tackle three main areas of concern:
Geoblocking is a practice whereby internet providers place restrictions on consumers’ online access by reason of their nationality or place of residence. The sector inquiry and consultation revealed that geoblocking is prevalent across the EU, with up to 90% of consumer respondents experiencing geoblocking whilst shopping online. The new rules aim to ensure that consumers buying foreign goods or services (whether online or in person) are not unfairly discriminated against in relation to prices, sales and/or payment methods, unless there is an objectively justified reason for doing so.
2. Efficiency and pricing of cross-border parcel delivery
According to the sector inquiry and consultation, the price of cross-border parcel delivery is perceived as much too high by retailers and consumers alike; in some cases being up to five times more expensive than domestic delivery options. Interestingly, the EC does not currently intend to impose a cap on cross-border delivery prices. However, the proposals call for increased regulatory oversight by national postal regulators of parcel delivery providers. This would involve a requirement to publish both domestic and cross-border prices, and would allow national postal regulators to oversee price differentials in order to promote price transparency and competition.
3. Strengthening protection and enforcement for consumers (click here for the full EC proposal)
Through a proposed revision of the existing Consumer Protection Cooperation Regulation, the EC intends to increase national authorities’ powers to enforce consumer rights by enabling them to: (i) check whether websites are geoblocking consumers or are offering after-sales conditions that are not compliant with EU rules; (ii) order immediate deactivation of websites used to scam consumers; and (iii) request information from domain registrars and banks in order to identify responsible rogue traders. Additionally, the EC would facilitate common actions with national authorities where EU-wide breaches of consumer rights exist in order to ensure a swifter and more effective means of consumer protection.
The proposals, being in the initial stages of the legislative process, will next pass through the European Parliament and national governments for consideration and adoption throughout 2017 and 2018.