The Commission’s New Proposals on the Digital Single Market, May 2016

In May 2015, the European Commission published its Digital Single Market Strategy. The document outlined a number of targeted actions which the Commission was to undertake in 2015 and 2016. The Strategy consists of three pillars entitled: I) Better access for consumers and businesses to digital goods and services across Europe, II) Creating the right conditions and a level playing field for digital networks and innovative services to flourish and III) Maximising the growth potential of the digital economy. Behind the somewhat non-descript names hides a desire to address a number of relatively serious problems. In the first pillar, this includes simplifying and increasing the volume of e-commerce across EU borders, dealing with the problem of geo-blocking,  reforming copyright rules and reviewing the Satellite and Cable Directive. The second pillar has the task of reforming the telecoms rules, the audiovisual media framework (AVMS Directive) and the role of online platforms. In the third pillar, the Commission looked at free flow of data and standards and interoperability.

At the time of publication the Commission specifically underlined the removal of geo-blocking and the creation of level-playing field as being important. The first was, at that time, understood in its broad sense, as including both geo-blocking in sale of goods and services and geo-blocking that stems from differences of copyright law but very soon the attention concentrated on the former only (considering the difficulties that would arise form attempting to remove the latter). The level-playing field, on the other hand, refers to a complicated issue of the relation of OTT players and the incumbent telecommunications companies.

The first proposals resulting from the 2015 DSM Strategy came already in December 2015. They included a successor to the failed Common European Sales Law (CESL) – in the form of the Proposal for a Directive on certain aspects concerning contracts for the supply of digital content, coupled with a Proposal for a Directive on certain aspects concerning contracts for the online and other distance sales of goods. In addition to this, and delivering partially on the promise to remove geo-blocking, a Proposal on ensuring cross-border portability of online content followed.

Today, partially following on the promises made in the 2015 Strategy, the Commission made five new proposals.

  1. In the area of geoblocking, it proposed a Regulation on addressing geoblocking and other forms of discrimination based on customers’ nationality, place of residence or place of establishment. The gist of this proposal, which does not address copyright or AVMS issues, is found in Articles 3 and 4. Article 3 prohibits  measures which limit access to traders’ online interfaces for reasons related to nationality, place of establishment or place or residence of the customer. Article 4 outlines 3 situation in which geo-blocking is illegal: a) when the goods are not delivered cross-border by the trader or on his or her behalf; b) where the trader provides electronic services (other than matter subject to copyright), c) where the goods are physically supplied on traders’ premises but not in the customers’ place of residence. In any case, the regime does not apply to certain SME enterprises.
  2. In the area of cross-border parcel delivery, it proposed a Regulation on cross-border parcel delivery services. The proposal increases price transparency and regulatory oversight of cross-border parcel delivery.
  3. In the area of consumer protection, a Regulation on cooperation between national authorities responsible for the enforcement of consumer protection laws has been proposed. Among other things, it allows for immediate take-down of websites hosting scams.
  4. In the area of audio-video media services (AVMS Directive), a new Directive is being proposed. The new regime has better rules for protecting minors from harmful content and for protecting all citizens from incitement to hatred. The proposal also aims to improve the definition of the country of origin and introduces a minimum 20% limit on European content in broadcasts.
  5. In the area of online platforms, the Commission will maintain the existing intermediary liability regime, found in Article 12-15 of the E-Commerce Directive. Instead, in a Communication, it proposes to address the issues of intermediary liability through the updated AVMS Directive, in the coming copyright reform package and through  encouraging self-regulatory efforts by online platforms.

There is no doubt that at at least the geo-blocking and AVMS proposals bring significant changes to the present picture. I will address these proposals in more detail in the weeks to come.