What is Geo-blocking and how do the new EU rules aim to improve consumer protection?
Have you ever been geo-blocked? Don’t know what that is? Well, if you regularly do cross-border online shopping chances are you have been geo-blocked at some point.
Just in time for Christmas, the European Union has managed to get one more positive change in consumer protection over the line before 2018 comes to a close; on 3rd December, the Geo-blocking Regulation became applicable throughout the European Union. Hopefully the new rules will help prevent, or at least reduce, instances where online traders unjustly discriminate against consumers based on nationality or place of residence and increase consumers’ access to goods and services within the internal market.
To help you understand it a bit better we’ve put together a few points on what is geo-blocking, how the new rules aims to improve consumers’ experience, and what happens if traders don’t comply.
As always, we have the consumer success story of the month which looks at how ECC Ireland helped a consumer get a refund of €1,800 from a third-party booking agent after her flight was cancelled. The consumer query provides advice to a consumer who bought a guitar lesson package but the disk, which contained the step-by-step courses, stopped working after a month.
You can download a PDF version here or simply read on!
Geo-blocking Regulation explained
What is geo-blocking?
Geo-blocking happens when online sellers/providers restrict online cross-border sales based on nationality, residence or place of establishment. These practices can include:
- Preventing users wishing to engage in cross-border transactions from accessing and purchasing goods, services, or digital content offered on a trader’s website or app;
- Limiting access to online interfaces;
- Re-routing users to country-specific websites (possibly with different prices); or
- Refusing delivery or payment
How does the Regulation aim to fix this?
Regulation (EU) 2018/302 (Geo-blocking Regulation) aims to give all EU consumers equal rights to access a trader’s goods or services, under the same terms, irrespective of their location. The new rules aim to tackle geo-blocking as well as other forms of discimination based on nationalality, residence or establishment. It applies in principle to both business-to-consumer (B2C) and to business-to-business (B2B) transactions.
Access to website and re-routing:
- An EU-based trader can no longer block or limit a customer’s access to its online interface (such as a website or app) based on their location and they cannot redirect the customer to a different online interface, without their express consent. This increases price transparency by allowing consumers to access different national websites. This also applies to non-audio-visual electronically supplied services such as e-books, music, games and software. However, geo-blocking is permitted where it is necessary to comply with EU or Member State law, but where this is the case, a clear and specific explanation must be provided.
Access to goods and services: There are now three specific situations where there can be no justified reason why a trader cannot provide customers with the same access to goods and services as local customers. These situations are:
- When a customer buys a good, such as electronics, clothes, sportswear or a book, which the trader does not deliver cross-border to the customer’s Member State. Such customers from other Member State are entitled to delivery in the Member State of the trader in the same way as local customers. For example, an Irish consumer wishes to buy a camera and finds the best deal on a German website. The customer will be entitled to order the good and collect it at the trader’s premises or organise delivery himself to his home.
- When a customer wants to buy an elecrontronically supplied service, such as cloud services, data warehousing or website hosting, from a trader established in another Member State. Such customers are entitled to do so in the same way as local customers are. For example, an Irish consumer wishes to buy hosting services for her website from a Spanish company. She will have access to the service, can register and buy this service without having to pay additional fees compared to a Spanish customer.
- When a customer buys a service (such as concert tickets, rental accommodation or car hire) which is supplied in the premises of the trader or in a physical location where the trader operates, where those premises or that location are in another Member State than in that of the customer, they are entitled to the same treatment as local customers. For example, An Irish family visits a French theme park and wishes to take advantage of a family discount on the price of the entry tickets. The discounted price should be available for the Irish family, just as it is for French families.
Discrimination for reasons related to payment: While traders remain free to accept whatever payment method they wish, the Regulation prohibits discrimination where:
- Payments are made electronically by bank transfer, direct debit or card-based payment within the same brand and category (i.e. debit or credit card of a given card company);
- Authentication requirements are fulfilled; and
- The payments are in a currency that the trader accepts.
What is not covered by the Regulation?
Certain goods and services are excluded from the scope of the Regulation, including transport services, retail financial services and healthcare services. Importantly, the Regulation does not cover the provision of services linked to non-audiovisual copyrighted content, for example e-books, online music, software and videogames. Audio-visual services also do not fall within the scope of the Regulation. The Regulation will be reviewed within two years after its entry into force which will focus on accessing its scope.
Help for consumers and enforcement
As regards disputes that may arise between consumers and traders in relation to the application of the geo-blocking Regulation, ECC Ireland, which provides free information and support to consumers with cross-border complaints, has been designated the national contact point responsible for providing consumers with practical assistance, whilst the Competition and Consumer Protection Commission (CCPC), has been designated as the body responsible for enforcement and monitoring compliance with the Regulation in Ireland.
Further reading and Information:
- Press releases from ECC Ireland and the CCPC about the Geo-blocking and their role.
Consumer success story of the month:
A consumer bought connecting flights (flights operated by two different airlines) through a third-party booking agent. The first leg of the journey was cancelled due to severe weather and the consumer was given the option of rebooking or to apply for a refund. She opted for the refund, however, because she had booked her flight via the agent the airline could not refund her directly and so it was provided to the agent (on to the original method of payment). The consumer spent several months trying to get her money back from the agent before contacting ECC Ireland for assistance. Following our intervention, the agent progressed the consumer’s request and a full refund of €1,800 was secured.
Consumer query of the month:
Q: I bought a learn guitar course package that included a guide as well as a disk with songs and a step-by-step course. I was told that course would be suitable for my device and I should be able to play it no problem. However, about a month later it stopped working and I was unable to continue to avail of the rest of the course. I’ve contacted the seller, but the issue has not been resolved. What are my rights?
A: Under the Sale of Goods and Associated Guarantees Directive 99/44/EC consumer goods must be ‘in conformity with the contract of sale’ so they should comply with the description given, be fit for purpose, and show the quality and performance one would reasonably expect. Where a ‘lack of conformity’ exists, consumers may require the seller to provide a repair or replacement, or if that’s not possible, is disproportionate, or cannot be completed within a reasonable time or without significant inconvenience the consumers are entitled to request a reduction in the price or a refund.
As the disk stopped working only a month after purchase (within the first six months), the fault is presumed to have existed at the time of delivery and, accordingly, the seller will be required to prove otherwise or provide the remedies set out in the Directive. You should put the complaint in writing to the seller to highlight the fault and outlining your rights. If repair or replacement is not possible then you can request that the seller provides a refund.
Press and Communications Manager
The European Consumer Centre is part of the European Consumer Centres Network (ECC-Net), which covers 30 countries (all EU countries plus Norway and Iceland), and offers a free and confidential information and advice service to the public on their rights as consumers, assisting customers with cross-border disputes. ECC Ireland is funded by the European Commission and the Competition and Consumer Protection Commission.
Disclaimer: Whilst every effort is made to ensure accuracy, the European Consumer Centre cannot be held responsible for matters arising from any errors or omissions contained in this publication. The information provided is intended as a guide only and not as a legal interpretation.
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