EU negotiators reach agreement to end unjustified geoblocking
According to a European Commission press release, the European Parliament, the Council and the Commission have delivered on commitments made during September’s Digital Summit in Tallinn by ending unjustified geoblocking, one of the EU priority files for 2017.
The European Parliament, the Council and the Commission reached a political agreement to end unjustified geoblocking for consumers wishing to buy products or services online within the EU. The new rules will boost ecommerce for the benefit of consumers and businesses who take advantage of the growing European online market.
Vice-President Andrus Ansip, responsible for the Digital Single Market, said: “Today we put an end to unjustified discrimination when shopping online. This is excellent news for consumers. With the new rules, Europeans will be able to choose from which website they wish to buy, without being blocked or re-routed. This will be a reality by Christmas next year.”
Commissioner Elżbieta Bieńkowska, in charge of Internal Market, Industry, Entrepreneurship and SMEs, added: “We are upgrading the EU Single Market to the digital world by giving consumers the same possibility to access the widest range of offers regardless of whether they physically enter a shop in another country or whether they shop online. Next stop: bringing down prices of cross-border parcel delivery, which still discourage people from buying and selling products across the EU.”
Commissioner Mariya Gabriel, in charge of the Digital Economy and Society, concluded: “Ending unfair geoblocking is a great step forward for consumers and the building of a real Digital Single Market working for all. Along with the end of roaming charges and portability, EU citizens will be able to buy their new furniture online, book hotel rooms or use their credit card across borders, like at home.”
For citizens this means they will be able to buy their new electrical goods online, rent a car or get their concert tickets across borders as they do at home. It will ensure that they no longer face barriers such as being asked to pay with a debit or credit card issued in another country. For businesses, this means more legal certainty to operate cross-border.
As the President of the European Commission, Jean-Claude Juncker, said at the Digital Summit in Tallinn last September, the EU legislators have to conclude on all the 24 legislative proposals that the Commission has put forward since the beginning of this mandate to complete the Digital Single Market. The European Commission is willing to help the European Parliament and the Council to find good agreements and proved it by making the deal possible.
New rules define 3 situations where there is no justification or objective criteria for geoblocking
The new rules define three specific situations where no justification and no objective criteria for a different treatment between customers from different EU Member States are conceivable from the outset.
- The sale of goods without physical delivery. Example: A Belgian customer wishes to buy a refrigerator and finds the best deal on a German website. The customer will be entitled to order the product and collect it at the trader’s premises or organise delivery himself to his home.
- The sale of electronically supplied services. Example: A Bulgarian consumer wishes to buy hosting services for her website from a Spanish company. She will now have access to the service, can register and buy this service without having to pay additional fees compared to a Spanish consumer.
- The sale of services provided in a specific physical location. Example: An Italian family can buy a trip directly to an amusement park in France without being redirected to an Italian website.
The Regulation does not impose an obligation to sell and does not harmonise prices. It does however address discrimination in access to goods and services in cases where it cannot be objectively justified (e.g. by VAT obligations or different legal requirements).
The new rules will come directly into force after nine months from the publication in the EU Official Journal, to allow in particular small traders to adapt.
A Commission survey found that geoblocking practices were identified in 63% of all websites assessed. It shows that in 2015, less than 40% of websites allowed cross-border customers to complete a purchase. This results in less revenue for companies and less choice for consumers. Proposed in May 2016 as part of the Digital Single Market, the Regulation to end unjustified geoblocking was identified as a legislative priority for 2017 by the agreement of the three European institutions in their Joint declaration earlier this year. This Regulation was part of an e-commerce package together with a legislative proposal on cross-border parcel delivery services and a legislative proposal to strengthen enforcement of consumers’ rights.
For More Information
May 2016 study on geoblocking of consumers online: