EU cracks down on website ‘geoblocking’

The European Commission has introduced proposed measures to crack down on the online practice of "geoblocking" where consumers experience problems with internet transactions based on where they live.

It is part of the EU’s “digital single market” strategy which would more tightly govern the rights of consumers in the virtual world.

“We will give teeth to consumer protection authorities to better enforce consumer rights online and crack down on fraudulent practices,” said Vera Jourová, Commissioner for Justice, Consumers and Gender Equality following Wednesday’s launch of the proposed measures.

Geoblocking can affect online shoppers in various ways. The most common include an inability to buy from websites based on nationality or being redirected to “national” versions of a site, the inability to avail of special offers from other countries or difficulties in securing delivery.

The “three-pronged” approach from the Commission will focus on increasing cross-border delivery regulations and price transparency; strengthening consumer rights and providing guides to them; and preventing the discrimination of people based on location or nationality.

Prices

A recent high profile case saw Disneyland Paris agree to amend its sales practices following complaints, and an ensuing EU investigation, into its price structuring on packages for people living in EU countries outside of France.

As with theme parks, the principle of non-discrimination espoused under the EU Services Directive has also already been applied to the car rental industry given its inherent cross-border nature.

The Commission's detailed proposals will now be considered by the European Parliament and Council and could be in place by 2017.

Gunther H Oettinger, Commissioner for the Digital Economy and Society said the move was designed to strike a balance between consumer interests and providing legal certainty to companies.

The measures will guard against price, sales or payment condition discrimination “unless this is objectively justified for reasons such as VAT or certain public interest legal provisions”.

Small businesses will be exempt from certain provisions where they fall under a national VAT threshold.

As regards delivery costs - which can see cross-border fees of up to five times higher than domestic postal services - the Commission hopes price transparency can influence change through competitive pressure and will not be proposing caps.