This week, the European Commission presented its plans for creating the Digital Single Market. These concern an array of measures, which shall improve the opportunities for businesses and consumers to take part in a European market for digital products and services. In future, the EU shall, among other, set more uniform standards in respect of mail order business, geo-blocking, VAT tax collection and copyright. According to the Commission, this would lead to lower prices, better legal protection as well as growth and employment. However, the line taken by the EU authority on platforms such as WhatsApp or Skype remains unclear.

Long-term strategy as a mosaic of individual measures

The Communication from the Commission, presented by Andrus Ansip (Vice President of the Digital Single Market) and Günther Oettinger (Commissioner for Digital Economy and Society) promises GDP increases of up to EUR 415 billion, should it be possible to overcome digital obstacles in Europe. Apart from contract law reforms for online trading, simplifications in respect of charging VAT when sending goods to another EU country and ending the existing VAT exemption of small consignments from third countries, the Commission also recognises a need for action in the offline world. Hence, the cross-border parcel shipment within the Union shall also be examined; according to the Commission, due of its high prices it represents a significant obstacle for the European online mail order business. Based on more effective supervision and price transparency, the Commission wants to make improvements following a consultation. Other initiatives concern the frequency allocation in mobile communications, cyber security and data protection, free Union-wide movement and trading of data, digital qualifications of citizens as well as the European consolidation of electronic administrative procedures (e-government).

Geo-blocking, copyright and “online platforms”

Due to their significance for everyday life, the plans on geo-blocking and copyright have been met with great public interest. According to his own statements, Ansip “hates” geo-blocking and wants to use his strategy to ban any “unjustified” blocking of internet contents because of a user's geographic location. Currently, this was not only common with regard to film and television platforms, but also in respect of businesses. For example, prices of rental car companies were frequently based on the country, in which a person made an online reservation.

However, “justified” geo-blocking would exist if national provisions would ban certain offers (e.g. gambling in some countries), but also if providers would incur higher costs without territorial restrictions. Whether this also includes offers such a ORF Tvthek or Netflix, which are not able to provide certain contents in certain countries, remains unclear. In any case, a reform of the copyright shall ensure that contents purchased at home, can be consumed throughout the EU and that the purchase of music or films will also become possible for foreign providers.

Even less clear is the Communication of the Commission with regard to “online platforms”, which include search engines and social media (such as WhatsApp). These were partly in competition with traditional, regulated telecom companies without being subject to the same legal provisions. In future - also following a consultation - a “level playing field” shall be provided.

AK takes a critical view of consumer protection concerning mail order business and Cloud Computing

The AK takes a critical view above all in respect of “simplifications” within consumer protection. With regard to online trading, the AK rejects the planned option for vendors to apply their own domestic law when sending goods abroad. In view of the danger to private sphere and data protection, the AK is also sceptical of the plan to force the pace of Big Data and Cloud services through legal measures.