EC's new geo-blocking rules won't apply to e-books

Trade bodies representing publishers and booksellers in Europe have welcomed the fact that new European Commission (EC) rules on geo-blocking do not apply to e-books, for the time being.

The EC released a package of six initiatives to improve the Digital Single Market (DSM) today (25th May), including one proposal on geo-blocking - the practice of restricting access to internet content based upon the user's geographical location.

The commisison believes that customers should be able to buy products and services from traders located in a different countries in the European Union, and should not face discrimination in accessing the best prices.

The EC said: “Consumers and businesses – especially SMEs – show an increasing interest in shopping across the EU and online sales of products are growing by 22% per year. However, frequently traders still refuse to sell to customers from another EU Member State or to offer equally advantageous prices in comparison with local clients.”

The new proposal today defines specific situations when there can be no justified reason for geo-blocking or other forms of discrimination based on nationality, residence or location.

However, audiovisual services are not covered by the new guidelines, which e-books fall under, because the EC presented a proposal allowing Europeans to travel with the digital content – films, music, e-books and games – that they have purchased or subscribed to at home, as part of its ongoing modernisation of the EU copyright framework in December 2015.

However, print books are covered by the new legislation in terms of delivery - a trader has to accept a passive sale from another country as long as the delivery cost must be paid by the buyer. Fixed books prices are protected, however.
There will be a revision of the regulation around e-books in two years’ time.

Federation of European Publishers (FEP) president Pierre Dutilleul said: “The e-book market is still in early stages in most of the European countries and the investments made by all players are considerable to serve the widest possible audience. However, because of the sheer size of the current e-book market and because legislations meant to safeguard and promote cultural diversity need to be respected, including e-books in the regulation without having assessed the impact would have been detrimental to the market itself.”

He added: “With this review clause, FEP and its members will be working with the services of the EC to find the right balance to encourage a sustainable ecosystem for the book.”

The European & International Booksellers Federation (EIBF) said: “We welcome the fact that laws of Member States will be applied with respect to sales of books. We note that the Commission plans to review the possible inclusion of electronically supplied services protected by copyright including e-books two years after the entry into force of the regulation.  EIBF is very happy to co-operate with the European Commission, and provide decision-makers with the information necessary to properly assess the situation for the wellbeing of the bookselling industry and European consumers.”

The organisation added: "While the larger and more mature language markets in the European Union benefit from an organised and experienced physical and digital distribution system, a significant number of markets are structurally still working hard at  organising their e-distribution and need more time to build up a performing technical offer."

In addition, some crucial infrastructural issues, like access to fast broadband in European homes and the implementation of a European online debit card system for the benefit of retailers and consumers, still have to be addressed, the EIBF said.

Also today (25th May), the European Commission said its recent public consultation on online platforms has highlighted "a number of concerns from suppliers" about business practices and that it will continue to look into the issue and decide if further action should be taken next year.

The consultation looked into, among other things, the social and economic role of online platforms, their use of personal data, their ratings and reviews, issues of illegal content, and the relations between online platforms and their suppliers. It ran until January 6th.

Of the over 1,000 respondents whose replies are included in the EC's preliminary report, 11% were from the UK, the third highest contributor behind Germany (17%) and Belgium (13%).

The report found that while "a large majority" of citizens and businesses recognised the benefits of online platforms, which it named as including eBay, Amazon Marketplace, Google, Facebook, YouTube and Google Play and App Store, another "large majority" had encountered or were aware of problems faced by consumers and suppliers.

Concerns from suppliers about allegedly "unfair" practices, including "platforms imposing unfair terms and conditions, in particular for access to important databases; platforms refusing access to markets or essential business data necessary for suppliers; platforms promoting their own service to the disadvantage of a third-party supplier" were highlighted in the consultation, the EC said.

The EC said it was "vital that more evidence is obtained" on the prevalence of such practices, "all the more important in light of the fact that some member states are already in the process of introducing or considering the introduction of platform-specific measures to address some of these unfair trading practices, risking fragmentation of the Digital Single Market."

Further engagement with public authorities and stakeholders to find out more about such practices would take place, before the EC decides "if further action to address fairness in business-to-business relations is necessary in 2017," the body said.   

An EU policy approach is being developed towards online platforms because the EC wants "a balanced regulatory framework which allows consumers and businesses in the EU to benefit from the dvelopment and scaling-up of online platforms and which also protects the legitimate interests of users and fundamental values."   

The issue is being addressed independently of the EC investigation into Amazon's e-book distribution and its relationship with publishers, launched last June.