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Online shopping will be made even smoother just before the next Christmas shopping

Blogs May 4, 2018

Ever attempted to place an order with an international webstore in pounds only to be directed back to a your location based website with less favourable prices in euros? Tried to make a purchase with your Visa credit card only to be refused to finalize the order solely because the card has been issued by a ’wrong’ EU country bank?

There are now great news for all devoted online shoppers in Europe, as such discriminatory actions are about to end thanks to the new so-called EU Geo-blocking regulation, which will enter into force in the beginning of December 2018 - just in time before the next X-mas shopping .

The main goal of the Regulation is to abolish discriminatory measures based on consumers location or nationality used by traders which are preventing free accessing and purchasing goods and services within the EU. The regulation applies to both purchasing goods and services online and off-line as well as for cases where these channels are integrated (omni-channel). Also the definition of consumer’s encompasses businesses as end-users of goods and services.

The regulation also applies to all third-country traders offering goods and services to consumers in the EU.

While it seems unthinkable of online shopping having borders, but based on EU statistics of 2015 63% of websites did not let shoppers buy from another EU country. What will change now?

Access to websites

  • It will be banned to block access to and re-route consumers without their prior consent. Even if the customer has accepted to be redirected, it should always be able to go back to the original destination. Hence the consumers should be able to freely choose the currency of their purchase.

Sale of goods without delivery

  • Webshops will have to accept purchases from customers also from such an EU country, which is not among its ordinary destination countries, if such customer agrees to collect the purchase from seller’s premises or organizes the delivery himself.

Sale of electronically supplied services

  • A customer cannot be banned from buying an electronically supplied service, such as website hosting service or a cloud service from another EU country in the same way as local customers do, i.e. without payment of additional fees.

Sale of services provided in a specific physical location

  • Customers from another EU country are entitled to equal treatment with the local customers, when buying goods and services at the premises of the trader. For instance if a museum in Estonia applies lower ticket prices for elderly, also Finnish customers should be able to enjoy the same discount.

Non-discriminatory payment

Traders continue to be free in choosing the suitable means of payment, but they must make sure that they would not discriminate the consumers due to their nationality or location within the range of accepted means of payment. This rule applies, if the trader uses electronic or card payments, which are authenticated and made in the currency the trader accepts. In principle this means that in case the webshop accepts certain type of Visa credit or debit cards, it may not pick and choose cards based on their country of origin. This rule neither implies that the traders are obliged to accept payments, if that would mean they need to enter into a new or modified contract with a payment service provider nor is the trader obliged to accept any type of payment. Neither does the regulation prevent applying fees for the usage of certain credit cards, but these charges may not exceed direct costs born by trader for the use of such payment instrument.


Legal requirements

The Regulation nevertheless allows for exceptions , in cases when the differential treatment is due to EU or national legal requirements imposed on trader to block access to certain goods or services (e.g. restrictions on selling of alcohol or snus).

The regulation does apply to services that are outside the scope of the EU Services Directive, such as transport services, retail financial services and audiovisual services. Having said that the prohibition to apply discriminatory measures to goods and services not covered by the Regulation may follow from other applicable EU rules (e.g. in respect of transport services)

As already mentioned that the Copyright protected services are in principle are outside the scope of the Regulation, however few exceptions apply for the provision of non-audiovisual services (e-books, software, music). Namely it is still not allowed to block or limit usage of online interfaces of such services or apply discriminatory electronic payment means based on nationality and location.

Despite that the current regulation does not apply audiovisual services, facilitating access such services is part of the EU Commission’s Digital Single Market Stategy and the modernisation of the copyright rules are currently negotiated within EU. This work has already born some fruits with the adoption cross-border portabiliy of online content services, enabling Europeans to fully use their online subscriptions to films, sports events, eBooks, video games and music services when travelling within the for the copyright protected, the trader’s.