Geo-blocking is a common practice among online sellers. It aims to deny access to websites from other member states.
“Geo-discrimination” takes place when online sellers refuse to deliver their products or services to other member states, when customers from certain countries are being asked for prepayment, or websites implement different terms and conditions as well as prices depending on the member state in question.
The European Parliament, the Council and the Commission reached a provisional agreement on a Regulation addressing unjustified discrimination based on customers’ nationality, place of residence or place of establishment. The Regulation is meant to enter into force on Christmas 2018.
There is no tangible draft of the Regulation yet. However, the Commission’s press release gives a first impression of the envisaged regulatory content.
Example 1: A Belgian customer wishes to buy a refrigerator and finds the best deal on a German website. The customer will be entitled to order the product and collect it at the trader’s premises or organize the delivery himself to his home.
Example 2: A Bulgarian consumer wishes to buy hosting services for his website from a Spanish company. He will now have access to the service, can register and buy this service without having to pay additional fees compared to a Spanish consumer.
Example 3: An Italian family can buy a trip to an amusement park in France directly at the French website without being redirected to an Italian website.
The Regulation does not impose an obligation to sell and does not harmonize prices. In addition, certain services are not covered in the proposal: Transport services (i.e. air flight tickets, bus and coach transport), retail financial services as well as audiovisual services (i.e. films, sports broadcasts, music, e-books and games).
Online sellers will have to adapt their services accordingly: They will have to edit their order forms and terms and conditions and provide pickup stations on their premises for foreign customers. According to Rome I, once an online seller directs his activities to another member state, the contract shall be governed by the law of the addressed country where the consumer has his habitual residence.
(30 January 2018)