The European Commission published its new proposal regarding online busines on 25th May 2016. The proposal containes new rules with the objective of facilitating electronic commerce regarding goods and services within the UE making it more accessibe for companies and consumers.
The package of measures shall have three essential points, which should promote the project of the digital single market:
- Push online business, removing geo-blocking.
- Make the sending of EU crossborder packets more affordable and efficient.
- Increase confidence through the better protection of consumers and an improved adherence to the regulations in force.
Andrus Ansip, vice president of the European Commission describes the problems experienced up until now on the path of achieving an accessible and open digital single market in the following words: “All too often, consumers are not able to access the best offers in their online purchases or decide not to buy in other countries because the parcel delivery costs are excessive or they fear that they will not be able to exercise their consumer rights if something goes wrong.
We wish to solve the problems which prevent consumers and companies from taking full advantage of buying and selling goods and services online”.
Geo-blocking
Geo-blocking is a form of discrimination arising from nationality or place of residence which is hoped will be prevented.
The proposed regulations are aimed at guaranteeing that consumers who wish to buy goods or services in another member State of the EU do not suffer discrimination due to different prices, sales or payment conditions in other Member States, unless there is justification for objective reasons, such as Value Added Tax or the protection of public interest.
The proposed Regulation does not have a shipping obligation for all of the EU, to avoid a disproportionate burden for companies. For the same reason, small businesses which do not reach the national threshold for VAT shall be exempt from some of the new provisions.
Cross-border parcel delivery
Problems with sending packages within Europe, and especially high prices, mean that consumers and also companies do not buy or sell more in other Member States.
The new Regulation shall bring more transparecy with it and shall make better supervision possible regarding the control of the regulation regarding cross-border package delivery services.
In this way, consumers and retail traders may benefit from more affordable tariffs and better forwarding options, without it mattering whether the delivery is for the periphery or urban areas.
It is hoped that prices will self-regulate with the stimulation of competition from better transparency in delivery prices within Europe.
The regulation does not set forth a limit upon shipping prices. The Commision shall evaluate progress in 2019 and shall decide whether it is necessary to implement other measures to regulate prices.
Increased consumer confidence.
The Regulation provides for equipping national institutions with more competences regarding collaboration in the protection of consumers.
In order to comply more effectively with consumer rights, national institutions shall be able to check whether websites use geo-blocking or whether they offer after-sale conditions which do not comply with EU regulations, order the immediate close of websites which commit fraud and request information from domain name registrars and banks in order to find out the identity of the trader.
In the case of breach of consumer rights at European level, the Commission may now collaborate with national institutions, and elaborate measures to stop illegal practices.
Vera Jouravá, European Commissioner for Justice, Consumers and Gender Equality, has affirmed: “In Europe, too many people mistrust online purchases because they do not know their rights or consider that it is difficult to exercise them. I want consumers to be able to buy online with the same confidence as they would have if buying from traditional businesses. We are going to give consumer protection authorities the resources necessary to better defend consumer rights online and to combat fraudulent practices. The package of measures presented today constitutes an important step to coordinate the protection of consumers in online trade and legal security for traders”.
The measures are a very important first step and are long awaited. Up until now, both on a national and a European level, it has not been possible to keep up with the innovation of new technology, and now at least the doors to new regulation have opened which shall lead to better legal security. Furthermore, the new regulations shall generate more liberty and the formation of a real digital single market.
Pina Pohl
Vilá Abogados
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12th August 2016
