In May 2016, the European Commission proposed a package of measures to allow consumers and companies to buy and sell products and services online more easily and confidently in the EU. Affordable cross-border parcel delivery was one of the proposed measures as high delivery and return shipping costs is a major obstacle of cross-border online shopping.
Consumers and small businesses complain that high delivery charges in cross-border shipping prevent them from buying or selling more across the EU. Prices charged by postal operators to deliver a small parcel to another Member State are often up to five times higher than domestic prices. These exorbitant costs are a major reason why only 18 per cent of EU consumers opt to buy the product or services they need from another EU Member State.
A general approach on the draft regulation for these new measures was recently achieved under the Maltese presidency of the Council of Europe. The new rules will foster competition by increasing price transparency and give national postal regulators the tools to monitor cross-border markets and check the affordability of prices. The Commission will publish public listed prices of universal service providers to increase peer competition and tariff transparency. The new rules will not put a cap on delivery prices. Price regulation is only a last resort where competition does not bring satisfactory results.
More transparent and affordable delivery prices will encourage more consumers to shop online across borders and more small companies to opt to expand their business by offering their product and services online to other EU countries.
Other measures proposed in the new e-commerce rules include the tackling of unjustified geo-blocking and other forms of discrimination on the grounds of nationality, residence or establishment and promoting customer trust through better protection and enforcement.
The geo-blocking initiative aims at striking the right balance between consumers’ interests to be able to shop online without borders and providing businesses with sufficient legal certainty. The new proposed rules ensure that consumers seeking to buy products and services in another EU country, be it online or in person, are not discriminated against in terms of access to prices, sales or payment conditions, unless this is objectively justified for reasons such as VAT or certain public interest legal provisions.
To avoid introducing disproportionate burdens on companies, the proposed regulation does not oblige online sellers to deliver across the EU and also exempts small businesses that fall under a national VAT threshold from certain provisions.
Regarding better consumer protection and enforcement, the proposed revision of the Consumer Protection Cooperation Regulation will give more enforcement powers to national authorities. In case of EU-wide breaches of consumer rights, the Commission will be able to co-ordinate common actions with national enforcement authorities to stop these practices. These co-ordinated actions will ensure a swifter protection of consumers, while saving time and resources for Member States and businesses.