On 25 May 2016, the European Commission has presented a package of measures to allow consumers and companies to buy and sell products and services online more easily and confidently across the European Union.Those measures are composed of three legislative proposals and can be summarized as follows.
1°) Legislative proposal for a regulation on addressing address unjustified geo-blocking and other forms of discrimination on the grounds of nationality, residence or establishment.
Geo-blocking means practices used by online sellers that result in the denial of access to websites from other Member States. It also happens when buying products and services off-line, for example, when a consumer is physically present at the trader’s location but is either prevented from accessing a product or service or being offered different conditions.
The proposal defines specific situations where customers from another Member State should have the same access to goods and services as local customers (sale of products without delivery, sale of electronically delivered service, sale of services provided in a specific physical location).
The proposed Regulation on geo-blocking aims to ensure that consumers seeking to buy products and services in another EU country, be it online or in person, are not discriminated against in terms of access to prices, sales or payment conditions (with certain exceptions).
It applies to all traders offering their activities to European consumers in the European union, regardless of whether they are established in the EU or in a third country. However, the transport services, the retail financial services and the audiovisual services are not concerned.
The scope of the provision on equal treatment in payments is limited to card-based payments. Moreover, in order to avoid introducing disproportionate burden on companies, small businesses, falling under a national VAT threshold, are exempted from certain provisions of the proposed Regulation.
2°) Legislative proposal for a regulation on cross-border parcel delivery services to increase the transparency of prices and improve regulatory oversight.
Consumers and small businesses complain that high prices and the inconvenience of cross-border parcel delivery are one of the biggest obstacles and prevent them from selling or buying more across the EU.
The proposed regulation aims to increase price transparency and regulatory oversight of cross-border parcel delivery services so that consumers and retailers ca benefit from affordable deliveries and convenient return options even to and from peripheral regions.
But the Commission is not proposing a cap on delivery prices. Price regulation is only a means of last resort, where competition does not bring satisfactory results. The Commission will publish public listed prices of universal service providers to increase peer competition and tariff transparency. In 2019, the Commission will assess if further measures are necessary.
3°) Legislative proposal for a regulation on cooperation between national authorities responsible for the enforcement of consumer protection laws.
However the Consumer Protection Cooperation Regulation, established in 2007, supports national consumer authorities when they address breaches of consumer rules in more than one country, currently only a limited number of enforcement authorities across Europe are equipped to address online breaches fast and efficiently.
The proposed revision of the Consumer Protection Cooperation Regulation will therefore give more powers to national authorities to better enforce consumer rights. For examples, they will be able to check if websites geo-block consumers or offer after-sales conditions not responding EU rules, to order the immediate take-down of websites or social media accounts containing scams, to request information from domain registrars and banks to detect the identity of the responsible trader.
Moreover, the proposal will increase legal certainty for businesses. More consistent and coherent cross-border enforcement will boost competitiveness of law abiding traders.
The proposal does not impose any additional legal obligations on the business sector. It streamlines administrative systems for the enforcement of existing consumer laws and simplifies the business environment, especially in the EU’s Digital Single Market.
The European Commission is also publishing updated guidance on unfair commercial practices in order to clarify how to apply the Directive on unfair commercial practices in the online sector. For example, the Guidance clarifies that any online platform that qualifies as a trader and promotes or sells products, services or digital content to consumers must make sure that its own commercial practices fully comply with the UCPD.
This package of measures is to read as a complement of two legislative proposals on the supply of digital content and on online and other distance sales of good, proposed in December 2015, and the upcoming VAT simplification proposal planned for autumn 2016.
Authors: Luc Stalars & Catherine Halkin
