The Consumer and Competition Day took place in Luxembourg on September 21, 2015. This was an event organised by the Luxembourg Presidency. The conference, which was focused on strategic priorities for a digital market, put forward by the European Commission on May 6, 2015, brought together representatives from the Commission, the European Parliament, competition authorities and Member State authorities , business representatives and also consumer associations. Geoblocking and improvements to access to digital goods and services for consumers and businesses were at the centre of this first round table.
For Luxembourg's Minister of the Economy, Etienne Schneider, the digital market that currently exists is " below its capacity ". The minister called for the elimination of barriers and restrictions in the internal market and for the creation of a real " European market place " with the aim of putting an end to the " European patchwork of national markets which hurts small and medium enterprises (SMEs) and consumers ".
Etienne Schneider also mentioned that only 15 % of consumers make their purchases on-line in EU countries other than their country of residence, and that only 7 % of SMEs sell abroad. Furthermore, there is now a growing disparity between the reality on the ground boosted by supply and demand and the regulatory framework that barely adapts to these mutations, he said. "There needs to be a reduction if not an elimination of the risks that we run in terms of competitiveness and new sources of jobs that go unexploited ", he made clear, mentioning that the creation of a single digital market would allow, according to the Commission, the generation of 250 billion euros of additional growth in Europe throughout the mandate of the next Commission.
The special case of Luxembourg
Pierre Rauchs, President of the Luxembourg Competition Council said that even if much progress had been made since the introduction of the single market in 1992, barriers still exist, notably those surrounding electronic commerce, and particularly in small countries like Luxembourg. Consumers are confronted with location clauses which prevent them having access to content coming from different countries, to products which are not imported into Luxembourg if the supplier does not have a physical point of sale, to the impossibility of carrying out a transaction with a Luxembourg credit card, or even to higher prices simply due to them living in the Grand-Duchy, the speaker said.
The role of competition policies
Johannes Laitenberger, Director General at the European Commission DG COMP, spoke about the role of competition policies with the implementation of the single digital market. The European Commission tackles vertical restraints agreed between companies, which hinder the smooth running of e-commerce and risk fragmenting the single digital market, he indicated. Additionally, the Competition Commissioner, Margarethe Vestager, in March 2015 launched an inquiry into the anti-competition practices within the e-commerce sector in the EU, he added.
According to the speaker, less than half of all attempts to make purchases on foreign websites are successful, while the success rate is 97 % when the purchases are made on domestic websites. " We want to become more aware of the extent of these barriers and the impact they are having ", he concluded.
Geoblocking: the result of single market obstacles for consumers and businesses ?
Different experts spoke at the round table on geoblocking. For Lucilla Sioli, Head of Unit, DG CONNECT, European businesses are limited in the way they integrate digital technologies compared with American businesses. This is why one of the four pillars of the digital single market strategy concerns e-commerce which is a growth factor. The speaker called on businesses not to construct artificial barriers.
" Geoblocking runs contrary to the principles of the internal market ", she said. The biggest issue in the single digital market is, according to her, making all existing regulations and instruments valid for the digital sector. She cites Article 20 of Directive 2006/123/EC regarding services in the internal market which forbids discrimination on the grounds of nationality or place of residence for access to a service within the EU.
For Ursula Pachl, Deputy Director General, BEUC, there are four instruments which allow the problem of geoblocking to be confronted : Article 20 of Directive 2006/123/EC as mentioned previously, the case law framework relative to authors' rights, the competition law and finally, better information for consumers on geoblocking. According to her, a paradigm shift and frame of mind is needed.
Guido Lobrano, Deputy Director, BUSINESSEUROPE, tackled the question from the perspective of European businesses. He said that businesses do not choose to discriminate, rather they have no choice. " Geoblocking is the consequence of dysfunctionality in the internal market ", he said. This dysfunctionality can result in a lack of harmonisation at the European level, different interpretations by Member States of European legislation, different market conditions, the existence of different rates of VAT in different Member States, different currencies in countries not members of the euro zone and differences in copyright law that make sales illegal in some countries. For him, " a single market where geoblocking is not necessary should be our aim ".
Finally, Jacques Steenbergen, President of the Belgian Competition Authority, highlighted that geoblocking had taken on a new dimension with the emergence of e-commerce. According to him, it is difficult to organise a shared market, and these difficulties affect businesses as much as consumers and those who regulate. Thus a coherent decision must be taken, he said, which avoids a case-by-case approach that risks upsetting the internal market. Furthermore, as most operators in the market are SMEs, it is also necessary to create clear, simple regulations.