Monday, 7 october 2019 | Redacción CEU
Buying has never been as easy as it is now. Customers only need to have a mobile device -or a computer- and an Internet connection. They place an order by means of a simple click and, in case they are buying goods, they just have to wait for their delivery to arrive at their shipping address. Thanks to the e-commerce boost, we can access a colossal product market in which geographical barriers are blurred. For example, a Spanish user can buy a lamp from a manufacturer in China without moving from their desks, and even without blinking. But, to what extent is this digital market flexible and open? What kind of obstacles can users find in their online purchases? Are there any blocked territories within our borders?
E-commerce is developed on a digital environment, but this does not mean that it is not affected by certain barriers, specifically geographical ones. In fact, there is a phenomenon known as geoblocking. This is a discriminatory and unjustified practice carried out by some traders and based on the nationality, place of residence or place of establishment of customers on the digital media.
The European Union approved a regulation on geoblocking (Regulation 2018/302) with the goal of unlocking e-commerce that entered into force in December last year. This new standard reinforces a strategy towards the configuration of a single and digital market that makes it possible to remove online barriers within the member countries. Does this mean that after its approval within the EU there will no longer be any geographical barriers to e-commerce?
A regulation with some limits
This regulation was implemented with the aim of guaranteeing -in relation to both general conditions on sales and prices- equal access to services and goods, but only in three cases:
- Goods that are delivered to places where traders offer delivery services or that are collected at a location agreed on with the customer (like clothes, electronics, accessories, etc.)
- Digital services that are not copyright-protected (data warehousing, cloud computing, etc.)
- Services provided at the place where traders carry out their activity (hotel accommodation, car rental, etc.)
This new rule also regulates payment methods. At no time could traders apply different conditions based on nationality, the place of residence of customers, the place of establishment of the payment service provider, etc. Traders can choose their payment methods, but they have to be the same for the whole European Union. Naturally, these payments must comply with rules such as using a currency that the trader accepts or adapting to double authentication when it is requested.
With this regulation, the European Union expects to avoid other restrictive practices such as blocking and limiting user’s access to traders’ interfaces according to their location. This does not mean that traders must sell in all countries of the European Union. They can always choose their target market. This regulation forbids redirecting customers to another website (mainly, to charge a different price) according to their IP address. Likewise, traders do not have to carry out deliveries to member countries with which they do not work. In this case, customers are responsible for collecting them in the places which are offered by traders.
The European law represents an advance in the regulation on geoblocking, but it does not prohibit this practice in its entirety. For example, the services offered by companies such as Netflix or Spotify are not included in it, so these companies can continue blocking access or applying different prices depending on users’ location. Financial transport, health care and social services are also excluded from this rule.