Despite its numerous advantages to both consumers and traders, e-commerce in the EU is not functioning as smoothly as it could. Only 15 per cent of European consumers buy online from another EU country and only eight per cent of companies sell cross-border. To take down the barriers hindering both consumers and traders from fully benefitting from the digital single market, the European Commission recently adopted a package of proposals to stop unjustified geo-blocking, increase the transparency of parcel delivery prices and improve the enforcement of consumers’ rights.
The Commission’s proposed revision of the Consumer Protection Co-operation Regulation will make it easier for authorities to enforce consumer rights equally across the EU and thus boost consumer and business trust in e-commerce.
If adopted, the revised regulations, which were established in 2007 to support national authorities when they address breaches of consumer rules in more than one country, will give consumers confidence in online shopping as they will become more aware of their legal rights and will give more enforcement power to consumer protection authorities to better enforce consumer legislation online throughout the EU.
The proposal introduces new measures to national authorities to carry out mystery shopping to check geographic discrimination or after-sales conditions, takedown websites hosting scams and, when necessary, will request information from domain registrars and banks to identify defaulting traders.
Regarding problematic practices found across the EU, member States, led by the Commission, will jointly carry out an assessment of the unfair commercial practice and, where necessary, request concerned businesses to rectify the misleading practice.
If these negotiations fail, national authorities will agree which is best placed to take enforcement measures, saving resources for all the other ones.
The Commission has also published an updated guidance on the Unfair Commercial Practices Regulations to ensure uniform interpretation of the regulations and to respond to the challenges presented by the digital world, such as ensuring that any online platforms that qualify as ‘traders’ fully comply with EU consumer law.
The new guidance document does not change the existing unfair commercial practice legislation but explains how the legislation can be applied in practice
The new guidance document does not change the existing unfair commercial practice legislation but explains how the legislation can be applied in practice, giving examples of court cases and decisions by national enforcement authorities. It is intended to facilitate implementation of the Unfair Commercial Practices Directive, but in itself is not legally binding. This guidance document does not only benefit consumers in that it limits unfair practices but also benefits businesses as it gives them legal certainty, allowing them to design their commercial practices in a way that should be accepted across the EU.
Effective enforcement is essential for the geo-blocking proposal to deliver its intended benefits. Geo-blocking refers to practices used by online sellers that deny access to websites from other member States. It also includes situations where, even though consumers are granted access to websites, they are blocked from purchasing products or services or are re-routed to other websites.
The proposed regulation on geo-blocking addresses the problem of customers not being able to buy products and services from traders located in a different member States or being discriminated in accessing the best prices or sales conditions compared to nationals or residents.
The Commission’s proposal defines specific situations when there can be no justified reason for geo-blocking or other forms of discrimination based on nationality, residence or location. These situations include sale of products without delivery, sale of electronically supplied services and sale of services provided in a specific physical location, such as concert tickets and car hire.
The proposal also bans the blocking of access to websites and the use of automatic re-routing without the customer’s prior consent. This will increase price transparency by allowing customers to access different national websites.
With regards to payments, while traders remain free to accept whatever payment means they want, the proposal includes a specific provision on non-discrimination within those payment means.
It is important to clarify that the proposed regulation does not introduce an obligation for companies to sell but an obligation to treat European consumers in the same manner when they are in the same situation.
The proposed regulation applies to all traders offering their activities to European consumers in the EU, regardless of whether they are established in the EU or in a third country.
The third Digital Single Market proposal to boost the potential for cross-border e-commerce in Europe is a regulation that proposes measures in the area of parcel delivery. High prices and the inconvenience of cross-border parcel delivery are major obstacles for consumers and traders who want to buy and sell across the EU.
A public consultation on parcel delivery and a Euro Barometer survey on e-commerce have identified a lower price for cross-border delivery would make businesses and consumers buy and sell more online. Cheaper parcel delivery would encourage consumers to choose from a wider range of products and e-retailers to reach new markets.
The proposal aims to increase regulatory oversight of parcel delivery providers and improve price transparency to increase competition in parcel delivery markets and lower prices for consumers.
odette.vella@mccaa.org.mt
Odette Vella is director, Information, Education and Research Directorate, Office for Consumer Affairs, Malta Competition and Consumer Affairs Authority.