Geo-blocking Regulation applicable as of 3 December 2018

By Roelien van Neck, Mariska van de Sanden

12-2018

As of today, 3 December 2018, the Geo-blocking Regulation (Regulation (EU) 2018/302, "Regulation") applies. The Regulation addresses the problem of (potential) customers not being able to buy goods and services from traders located in a different Member State for reasons related to their nationality, place of residence or place of establishment.

The Geo-Blocking Regulation prevents such unjustified geo-blocking and geo-discrimination by prohibiting, in short:

  • Blocking of access or automatically re-directing customers to another website;
  • Application of different general conditions of access to goods or services, and
  • Application of different conditions for payment transactions,

based on a customer's nationality, place of residence or place of establishment.

This in turn should lead to better access to goods and services for customers in the EU.

Enforcement obligations

Enforcement of the Regulation is, however, not possible at the moment of writing this alert. The Regulation requires each Member State to:

  • Designate a body responsible for adequate and effective enforcement of the Regulation (Article 7 (1) Regulation)
  • Lay down the rules setting out the measures applicable to infringements of the provisions of the Regulation, which measures should be effective, proportionate and dissuasive (Article 7 (2) Regulation); and
  • Designate a body responsible for providing practical assistance to consumers in the case of a dispute between a consumer and a trader arising from the application of the Regulation (Article 8 Regulation).
Implementation of enforcement obligations

Each Member State will have to adopt an act implementing these obligations. The Netherlands has implemented these obligations in a bill amending the Act on enforcement of consumer protection rules ("Wet handhaving consumentenbescherming", "Bill"). The Bill stipulates that, in addition to the civil courts, the Authority for Consumers & Markets ("ACM") and the Authority for Financial Markets ("AFM") are the bodies responsible for the adequate and effective enforcement of the Regulation (Article 7 (1) Regulation). As regards the measures applicable to infringements of the Regulation (Article 7 (2) Regulation), the existing regime for the enforcement of consumer protection rules is followed. This means that the ACM and AFM have the possibility to impose fines up to a maximum of €900.000 or, if that is higher, 1% of the turnover of the infringing undertaking. Furthermore, the Bill designates the European Consumer Centre, part of the Foundation for Legal Aid ("Stichting Het Juridisch Loket"), as the responsible body for providing practical assistance to consumers pursuant to Article 8 of the Regulation.

The Bill was published on 28 September 2018. On 1 November 2018, however, some questions have been asked by the House of Representatives. These questions have not yet been answered at the time of writing this alert. The Bill has thus not been adopted. This implies that enforcement of the Regulation is currently not yet possible. Our expectation is, however, that these questions will be answered on short term and the Bill will be adopted quite soon afterwards. Each Member State will have to take action though.

Enforcement possible based on different legislation?

Besides, the fact that enforcement on the basis of the Regulation is not yet possible in the Netherlands, does not mean that enforcement is not possible at all. In some, comparable, situations, enforcement might be possible based on other legislation, like the competition rules or Article 20 of the Services Directive. The European Commission is, for example, investigating whether agreements concluded between the owner of a game distribution platform and five PC video game publishers have violated the competition rules by preventing consumers from purchasing PC video games, because of the consumer's location or country of residence.1


1 The Regulation does not apply to audiovisual services. Non-audiovisual services that are electronically supplied and are copyright protected are not subject to Article 4 of the Regulation.

 

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