Geoblocking

The key priorities for the European Policymakers involve the following:

  1. Endorse online merchants right to economic and contractual freedom in the geo-blocking debate
  2. Provide clarity on the applicable law in cases of sales to consumers resident in countries not targeted by the trader
  3. Do not require explicit consent for rerouting of websites
  4. Ensure no obligation for traders to cover costs of postage beyond the contractually agreed place of delivery
  5. Ensure that any assessment of whether a product has a non-conformity has to be based on the legal obligations in the country where theproducts are supplied
  6. Provide coherence between legislation on geo-blocking and developments in the online payments landscape

A radio interview about Geoblocking by Carine Moitier on Radio Contact

1. Endorse online merchants right to economic and contractual freedom in the geo-blocking debate

Consumers buying products and/or services online should not be subject to restrictive business practices when there are no grounds for the seller to do so. Nevertheless, online merchants shall rely on their fundamental rights to economic and contractual freedom and freedom of entrepreneurial activity. This also means that an individual company may decide on reasonable grounds not to sell or deliver to a consumer in another Member State or apply a different price for the same tangible good/service/digital content sold online.

2. Provide clarity on the applicable law in cases of sales to consumers resident in countries not targeted by the trader

One of the most important issues at stake in the geo-blocking debate is that of applicable law. Within the EU, contract law varies significantly between member states and, when selling cross-border to consumers, traders must take measures to comply with the mandatory contract law in the country to which they are selling. Differences of regulatory frameworks between European countries remain one of the most important barriers to cross-border e-commerce. Given this, it is unreasonable to expect online merchants to comply with contract law in all 28 EU member states, as this would be highly burdensome, especially for smaller traders. It is therefore highly important that legislation on geoblocking does not require this, and instead makes it clear when the trader makes sales to consumersin countries not targeted by the trader, the contract law of the trader will apply.

3. Do not require explicit consent for rerouting of customers

The practice of rerouting is usually used by the trader to provide the customer with a better, tailormade shopping experience, for instance, in their own language, currency and payment system and adapted to the local conditions of customer services and delivery. Seeking customers’ explicit consent for rerouting would have a negative and irritating effect on the customers’ shopping experience, comparable to the irritating consent mechanism now in place for cookies, as it would unnecessarily complicate the process of continuing the search – or returning to the original website. On the other hand, explicit consent – and the recording of it to prove compliance – would be a burdensome and costly requirement for businesses.

4. Ensure no obligation for traders to cover costs of postage beyond the contractually agreed place of delivery

It is extremely important that this Regulation should not be understood
as providing for an obligation to deliver goods cross-border to another Member State where the trader would not otherwise offer the possibility of such delivery to its customers or is not willing to offer it. This includes costs of postage associated with the customer’s exercise of their right to withdrawal, in case the trader voluntarily covers the costs to send the good back from customers in the areas targeted by the trader, as well as any postage costs associated with the assessment of non-conformity or the repair/replacement of the product.

5. Ensure that any assessment of whether a product has a non-conformity has to be based on the legal obligations and conditions in the country where the products are supplied

The Regulation should also mean that the customer should benefit from the same general conditions that would be applicable as if such a customer would have his or her habitual residence in a country where the trader offers the option to deliver the goods or where the provision of the services/digital content takes place. It should, however, be ensured that any assessment of whether the product has a non-conformity has to be based on legal obligations and conditions (including technical and operational requirements) in the country where the goods/services/digital content are actually supplied. A product will therefore not be considered as defective if it complies with the requirements of the country of delivery, even if it turns out that it does not comply with the requirements of the customer’s home country.

6. Ensure coherence between legislation on geo-blocking and developments in the online payments landscape

It is vital that the legislation on geo-blocking is formulated in order to provide coherence with developments in the online payments landscape. When operating cross-border, online merchants often face high levels of online payments fraud resulting from different standards in online payments across Europe. To mitigate the risk of online fraud, resulting from fraudulent online payments, merchants often take the business decision to “geo-block” customers from a certain area. The Payment Services Directive 2 (PSD2) and its objective to increase competition, security and consumer confidence in the European online payments landscape.

Source: Ecommerce Europe