Brussels, 25/05/2016 (Agence Europe) - A new wave of measures is being introduced to put the single digital market into practice. On Wednesday 25 May, the Commission presented a raft of measures to tackle unfair geo-blocking and to modernise the rules applying to new market entrants. There is also a small change with regard to the drafts currently in circulation up until now on: music and digital books, which will not be covered by the non-discrimination principle.
In total, the Commission presented eight documents including: a package on e-commerce based around a regulation tackling geo-blocking; a regulation on parcel deliveries; a regulation on cooperation in the area of consumer protection; guidelines on unfair trade practices; a communication on e-commerce; three sectoral documents including: a directive on audiovisual media services, communication and work document on online platforms.
Facilitating access to European content. The first raft of measures seeks to put a stop to geo-blocking based on nationality, the place of residence or establishment. According to the Commission, only 37% of websites allow consumers to make online orders in another member state other than their own. The draft regulation introduces the "same place, same service, same conditions" principle: it obliges traders to sell under the same conditions in their home countries, without discrimination on access to prices, sales or payment conditions. The new rules apply to European and foreign companies alike and subsequently operating in the European market.
The Commission proposal sets out a six-month deadline for application after the entry into force of the text on tangible goods and services provided locally (such as car rentals). It contains a much longer deadline (the middle of 2018) for services provided online, such as cloud computing services, data storage or website cover. Finally, it also includes specific provisions on non-audiovisual services covered by copyright: these will have to be accessible but not available for sale. In other words, the antidiscrimination principle will not apply, unless the Commission decides otherwise during the examination it will carry out two years after the entry into force of the text.
The European Consumer Organisation (BEUC), the Federation of European Publishers (FEP) and the Independent Music Companies Association (Impala) were not all delighted with the draft regulation. The two latter organisations, however, were relieved to see that their products had for the time being been excluded. The director general of the federation representing employers in Europe, BusinessEurope, Markus J. Beyrer, gave this development a cautious welcome and said that the Commission was quite rightly getting to grips with complex rules, such as the current fragmentation and lack of confidence but said that it was concerned by the lack of clarity regarding certain provisions. He also said that the difficulties selling abroad, as well as the uncertainties affecting after sales services would still remain.
No delivery price regulation, though. In a second legislative proposal, the Commission tackles the question of cross-border parcel delivery service prices. It is proposing to increase price transparency and improve the regulatory monitoring of tariffs. According to the Commission, the tariffs applied by postal operators for distributing a small parcel in another member state are sometimes up to 5 times as high than those for national deliveries, without there being a clear correlation with the real costs. The regulation seeks to introduce the publication of tariff lists used by universal service providers, in an attempt to increase competition between the respective players and the transparency of the tariffs. This will give national postal service regulators the data they need to monitor the cross-border markets and verify the affordable nature of prices and their relationship with the real costs, as well as encourage competition by demanding transparent and non-discriminatory access for third parties to cross-border parcel delivery services and infrastructure. The text calls for a progress assessment in 2019, in an effort to establish whether additional measures are required.
Postal operators immediately expressed their dissatisfaction. In a press release, PostEurop said, "the Commission also demands that national postal operators share a vast amount of confidential commercial data with national regulators... It also obliges national postal operators to grant full access to their delivery networks - with very few conditions - to third party operators… These last two proposed measures… go in the direction of price regulation and fail to reflect market conditions"… The organisation added that it was the E-traders setting the delivery prices and not the postal operators.
Sectoral initiatives: audiovisual and platforms
Revision of the AMS directive. Audiovisual media services are excluded from the new provisions seeking to tackle geo-blocking but are the subject of more far-reaching reform. The Commission is proposing to modernise the current 2010/13 directive in an effort to make the rules more flexible en advertising time and submit subscription video services to demands on the promotion of European works.
In terms of advertising, the text is proposing that programs can be interrupted by adverts every 20 minutes, instead of the current 30 minutes. It also allows TV chains to extend the length of advertising spots by applying the current 20% threshold in our over appeared from 7 in the morning to 23: 00 hours. During his presentation of the package, Commissioner Guenther Oettinger explained that broadcasters could choose where and when they place their advertising and the consumer could choose whether to zap or move onto VOD, which does not have advertising. The text also authorises product placement and promotion, in an effort to "create a level playing field with the US" explained Vice President Ansip to journalists, a few days before the presentation of the text
Another significant change focuses on the promotion of European content: the text imposes video on demand services (VOD) such as Netflix or Amazon Prime to broadcast at least 20% of European content. Currently, the European average is 27%, with greater disparities varying according to the different member states. France applies and obligatory 60% quota, whereas the Netherlands where Netflix was set up, does not impose any. The text also enables member states in which VOD services have been set up or in which these services are broadcast, to demand that these companies make a financial contribution to local cinema (either by way of direct investment or taxes paid to a National Cinema fund). The draft active allows, however, the member states to introduce exceptions and promotion of Europeans consent for thematic channels such as the Disney SMEs and micro companies, which have low viewer rates or low turnovers.
The European Broadcasting Union (UER) considers that the reform went in the right direction and is even delighted with the introduction of the "discovery" notion in general interest content contained in the new proposal. Nonetheless, it is still continuing to make a robust appeal for more access for viewers to programmes of public value. The commercial television association welcomed the greater flexibility on advertising rules but regretted the introduction of a compulsory quota on the promotion of European content (it believes that this quota should be based on demand).
Online platforms. As it previously suggested, the Commission said it intended to apply an approach based on the difficulties encountered in providing a framework for the online platforms. It will pursue four key objectives: (1) a comparable environment for comparable digital services; (2) responsible behaviour for online platforms to protect key values; (3) transparency and fairness principles to maintain users' trust and protect innovation; (4) open and non-discriminatory markets in a data economy. The Commission will apply, for example, these principles on ongoing re-examinations of EU telecommunications regulation and the privacy directive, as well as of electronic communications, when it examines whether the provisions involving confidentiality should be applied to online communication services and the established telecommunications companies. The orientations on unfair trade practices (see other article) already indicate that the platforms representing economic operators through their trade practices must respect the provisions contained in the UCPD directive. On the question of bulk, the communication also announces the Commission's intention to evaluate the formal procedures for notification and action on intermediaries, as well as carry out a targeted verification exercise on the relationships between companies (B2B), for example, between an online platform and its provider. The Commission also asserts that it will attempt, in its next proposal on copyright, plans of 21 September, to introduce a more fair distribution of the value generated by online content distribution through copyright. It said that they had to be able to read more clearly when these platforms are simple intermediaries and not when they sell content without paying the author. The European strategy for the collaborative economy will be discussed on 1 June and is expected to provide guidelines on European legislation applicable to online platforms and provide recommendations to member states, in an effort to support the balanced development of the collaborative economy.
In response, the EDiMA welcome to the Commission's pragmatism, whilst raising a number of questions that were still pending. The organisation representing online platforms, however, criticised the Commission's willingness to define the problems and solutions for all platforms, rather than retain a case-by-case approach. (Original version in French by Sophie Petitjean)