New rules for digital euroCommerce

geo-blocking
10 Dec 2018

What’s new for digital euroCommerce?

Geo-blocking

Geo-blocking was banned on 3rd December 2018. A customer in a European country can now shop online on any e-commerce website based in another EU country without being subjected to the limits or obstacles posed by this form of retail.

The European Parliament and Council approved a new regulation in February 2018. This regulation has now entered into force and forms part of the wider objective of creating the European digital single market.

Up to now online retailers could use geo-blocking to impose restrictions on consumers based on their nationality or place of residence. For example, they could block access to websites based in different countries, refuse orders or deny delivery to any country other than their own. More generally they applied different tariffs and conditions to foreign customers.

The new regulation will enable consumers to buy online irrespective of their nationality or the place of the transaction with the same conditions as those applied to local customers. According to Andrus Ansip, Vice-President of the European Commission and European Commissioner for the Digital Single Market, 63% of the websites did not let shoppers buy from another EU country in 2015.

B2B services

The EU’s objectives also include transparency for B2B services on the major online platforms.

Josef Moser from Austria (Vienna currently holds the six-month presidency of the EU Council) stated that, “Clear and effective rules are essential for the further development of cross-border trade within the single market. A company or a consumer will not sell or buy goods in another member state if there is not enough legal certainty on their rights and obligations.”

The new directive, which has already been approved by the Committee on the Internal Market in Strasbourg, will establish rules which must apply to all sales contracts in euroCommerce. These will include conformity of the products with the contract, measures to apply in the event of faulty goods, and how consumer guarantees must be honoured. These guarantees should be for a minimum of two years, and if national legislation provides for a longer period then this should be maintained.

Search engines and marketplaces must encourage the removal of goods or services from search results and clearly state the parameters that determine ranking in search results. Strict rules also apply to any arbitrary changes made to the terms and conditions of service of which the consumer must be informed with at least thirty days’ notice.

Complaints

All mid-sized to large online platforms must introduce an effective internal complaint-handling system and facilitate the out-of-court settlement of consumer disputes. An initial effect of the regulation is that businesses would be granted the possibility to take action collectively against platforms when complaints are not handled in an appropriate manner.