Following the publication of Regulation (EU) 2018/302 (the “Regulation”) in February 2018, new rules to prevent geo-blocking will apply throughout the EU from Monday, 3 December 2018.
The Regulation will entitle consumers and businesses within the EU to shop online on all EU websites without being re-routed to their national website. As such, the Regulation aims to reduce barriers to online trading within the EU. Matheson Partner, Deirdre Kilroy, has previously discussed the implications of this new regime and the preparation that should be undertaken by online traders.
Impact of Brexit?
With the uncertainty surrounding the Brexit withdrawal agreement continuing, the impact on UK businesses post-withdrawal remains somewhat unclear. Following the EU Commission’s warnings of the possible discriminatory impacts for UK customer’s post-Brexit, the UK Government in October 2018 issued corresponding Guidance addressing the implications of UK withdrawal.
The UK government has emphasised that even in the case of a no-deal Brexit, UK businesses operating in the EU, will remain bound by the provisions of the Regulation when dealing with EU customers, such that they could not discriminate between French and German customers within the scope of the Regulation. As such, UK businesses cannot completely ignore the implications of the Regulation. Irish businesses and consumers dealing with UK businesses should remain aware of the protections of the Regulation.
The EU Commission will carry out its first review of the impact of the Regulation in the internal market in December 2020. This review is likely to consider whether the scope of the new rules ought to be expanded to apply to audio-visual services offering copyrighted content, for example video on demand.
While such services are currently outside the scope of the Regulation, changing consumer behaviour patterns demonstrates their increased importance. For example, the recent BAI Broadcasting Services Strategy concludes that Netflix can be found in nearly a third of Irish households, estimating that 41% of Irish households will have some form of video on demand service by 2022. While eliminating cross-border access to streaming services raises complicated questions that go beyond geo-blocking alone, it is likely that their inclusion will be debated in any review of the Regulation in 2020.
Advice for Businesses
It remains to be seen how the Irish authorities will enforce the Regulation. Under the Regulation, responsibility for enforcement rests with the national authorities rather than the European Commission. However national authorities are required to keep the European Commission informed of their enforcement measures with a view to ensuring they are “effective, proportionate and dissuasive.”
While the UK has designed the Competition and Markets Authority as the applicable regulator, the Irish regulator has yet to be confirmed. In the event that Ireland follows the approach adopted in the UK, the Competition and Consumer Protection Commission is likely to be the designated authority.
As such businesses should carefully consider their selling arrangements to ensure that they do not expose themselves to the risk of enforcement action.