Proposals announced this week by the European Commission as part of the Digital Single Market Strategy are designed to make it easier for consumers to buy goods across borders inside the EU. These proposals are the first output from the sector enquiry and will have important consequences for retailers and consumers alike.

The Commission has proposed three legislative measures to:

  • tackle unjustified geo-blocking and other forms of discrimination on the grounds of nationality, residence or establishment;
  • improve cross-border parcel delivery services and increase the transparency of prices while reducing delivery costs; and
  • strengthen enforcement of consumers' rights and provide guidance to clarify what qualifies as an unfair commercial practice in the digital world. This does not impose any new obligations on retailers, but rather is intended to improve the ability of consumers to enforce the EU Consumer Protection Regulation 2007 through national courts.

All three measures are proposed to be implemented by way of EU Regulations which means that, once adopted, they will become directly effective across the EU without the need for further national legal measures.   This has the significant advantage of ensuring a consistent implementation across all EU Member States.

The proposed geo-blocking Regulation will ensure that:

  1. Consumers visiting an online site from any EU Member State will no longer be prevented from ordering and taking advantage of retailers’ international delivery options where these are generally available; and
  2. Consumers will be able to visit the country specific site of their choice.  In other words, a UK consumer can choose to visit, e.g. retailer.fr to take advantage of different purchasing options/prices on that site.  Retailers will not be able automatically to re-route customers (in this example back to the UK site) without the customer’s consent and even where consent is given, the domain must remain available.

Whilst retailers may offer different payment terms on different sites (for example, a local debit card system in France), it may not use this as a means to discriminate by nationality (hence accepting VISA and MasterCard requires retailers to accept all cards, wherever issued on each of its EU domains).

However, notable by their absence are any proposals to tackle the geo-blocking of audio visual services. This is in stark contrast to the Commission’s original intention when the DSM strategy was launched in March 2015. This means that for the foreseeable future there will be no general right of EU citizens to access sports events broadcast under exclusive territorial licences in other Member States.

The Commission is continuing to investigate the territorial restrictions in the content licencing agreements between the Hollywood film studios and Sky, and the Commission has also, disappointingly, deferred any attempt to reform the tangled web of EU copyright law until later this year. Interestingly, no copyright proposals have yet to be published. 

The Commission has also proposed an updated version of the Audio Visual Media Services Directive (AVMS) to extend its scope to cover video-sharing platforms, for example YouTube.

The new Directive requires Member States to ensure that video-sharing platforms put in place measures to:

  • protect minors from harmful content; and
  • protect all citizens from incitement to hatred.

In the proposal, a video-sharing platform is defined as a commercial service addressed to the public which:

  • stores a large amount of programmes or user-generated videos, for which the video-sharing platform provider does not have editorial responsibility;
  • where the content is organised in a way determined by the provider of the service, in particular by hosting, displaying, tagging and sequencing;
  • where the principal purpose of the service is providing programmes and user-generated videos to the general public, in order to inform, entertain or educate

Social media, such as Facebook or other services, are excluded from the proposal as they do not have as a principal purpose the provision of programmes or user-generated videos to the public.

The Commission has also published a Communication on Online Platforms, the next steps are:

  1. A review of EU telecoms legislation and e-Privacy Directive (end of the 2016).
  2. copyright reform package to address the allocation of royalties generated online platforms (autumn 2016).
  3. A review of the need for guidance on the liability of online platforms in relation to measures to fight illegal content online (second half 2016)

We will be keeping a close eye on the DSM developments and picking up on further points of note. For further information, the Commission’s general Q&A on boosting e-commerce in the EU can be found here and here on the revised AVMS Directive and online Communication.