European Commission’s draft Geo-Blocking Regulation fails to clear the way
The European Commission has published its draft Geo-Blocking Regulation, a key proposal in its ongoing effort to create the Digital Single Market in the EU.
The Commission has previously expressed concerns that online retailers may be implementing strategies which have the effect of unreasonably discriminating between customers based on their country of residence. The Commission’s primary concerns have been in the provision of consumer products, in particular fashion and consumer electronics and digital copyright work.
In our detailed article about the proposed regulation, as well as other Digital Single Market initiatives (which you can read here) we look at the approach taken in the draft Regulation and conclude that, whilst the it represents first steps towards resolving the issues raised by the Commission, there are several areas where the proposed regulation does not go far enough to tackle the fundamental problems – in particular by carving out consumer goods (in particular clothing and electronics), airplane tickets, and copyright works (in particular digital content).
Ultimately, the failure of the Proposed Regulation to go far enough to address concerns regarding geo-blocking means that, in its current form, the Proposed Regulation will be of limited benefit to customers and have a limited impact on businesses.
For global companies there are a few key points to note. In particular, where a company has location specific websites in the EU, the proposed regulation intends to limit the ability of retailers to automatically divert a consumer to a local website. Similarly, the proposed regulation prohibits retailers from imposing restrictions on consumers based on the geographic location of their payment service provider.