On December 3rd, 2018, the new Geo-blocking regulation comes into force EU-wide. Discriminations based on nationality or place of residence of a consumer when shopping online are now prohibited.
The Geo-blocking Regulation aims to provide for more opportunities to consumers and businesses within the EU's internal market. In particular, it 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, hence discriminating them when they try to access the best offers, prices or sales conditions compared to nationals or residents of the traders' Member State.
What is the Geo-blocking Regulation?
Geo-blocking refers to practices used by online sellers that result in the denial of access to websites from other Member States. It also includes situations where access to a website is granted, but the customer from abroad is prevented from finalising the purchase or being asked to pay with a debit or credit card from a certain country.
"Geo-discrimination" also takes place when buying goods and services off-line, e.g. when a consumer is physically present at the trader’s location but is either prevented from accessing a product or service or being offered different conditions.
How does the Geo-blocking regulation affect access to websites and other online interfaces?
The Regulation bans the blocking of access to websites and re-routing without the customer’s prior consent. This increases price transparency by allowing customers to access different national websites. This provision also applies to non-audio-visual electronically supplied services, such as e-books, music, games and software.
Example: An Irish customer wants to access the Italian site of an online clothes retailer. Even though she types in the URL of the Italian version, she gets redirected to the Irish version. After the entry into force of the Regulation such redirection will require the explicit consent of the customer and even if the customer gives consent to the redirection, the original version she sought to visit should remain accessible.
How does the Geo-blocking regulation affect access to goods and services?
The Regulation defines specific situations when there can be no justified reason for geo-blocking or other forms of discrimination based on nationality, residence or establishment. In these situations, customers from another Member State have the same access to goods and services as local customers. These situations are:
- Sale of products without delivery
When a customer buys a good, such as electronics, clothes, sportswear or a book, which the trader does not deliver cross-border to the customer's Member State. Such customers from other Member States are entitled to delivery in the Member State of the trader in the same way as local customers.
Example: A Belgian customer wishes to buy a camera and finds the best deal on a German website. The customer will be entitled to order the good and collect it at the trader's premises or organise delivery himself to his home.
- Sale of electronically supplied services
When a customer wants to buy an electronically supplied service, such as cloud services, data warehousing or website hosting, from a trader established in another Member State. Such customers are entitled to do so in the same way as local customers are.
Example: A Bulgarian consumer wishes to buy hosting services for her website from a Spanish company. She will have access to the service, can register and buy this service without having to pay additional fees compared to a Spanish consumer.
- Sale of services provided in a specific physical location
When a customer buys a service which is supplied in the premises of the trader or in a physical location where the trader operates, where those premises or that location are in another Member State than in that of the customer. This category covers services such as concert tickets, rental of summer accommodation and car hire. In this situation, too, the customer is entitled to equal treatment.
Example: An Italian family visits a French theme park and wishes to take advantage of a family discount on the price of the entry tickets. The discounted price will be available for the Italian family, just as it is for French families.
In the above cases geo-blocking or other forms of geographically-based differential treatment are only possible in exceptional situations defined in the Regulation, that is, where an EU or national legal requirement obliges the trader to block access to the offered goods or services (e.g. a prohibition to sell alcohol to non-residents).
How does the Geo-blocking regulation tackle discriminations related to payment?
While traders remain free to accept whatever payment means they want, the Regulation includes a specific provision on non-discrimination within the range of means of payment they accept. It covers situations where differential treatment is a result of the customer's nationality, place of residence or place of establishment, the location of the payment account, the place of establishment of the payment services provider or the place of issue of the payment instrument.
Differential treatment is prohibited if these three conditions are met:
- Payments are made through electronic transactions by credit transfer, direct debit or card-based payment instrument within the same brand and category;
- Authentication requirements are fulfilled, and;
- The payments are in a currency that the trader accepts.
What are the exceptions of the Geo-blocking regulation?
The Geo-blocking regulation is not applicable to some goods and services. For those, other EU rules apply which regulate the rights of consumers and duties of traders.
- Transport services: Those are covered by the passenger rights regulations of the EU, setting respective rules for travels by ship, rail, air, bus and coach (read more at our section "Travel").
- Financial services
- Audio-visual content: Those are regulated by e.g. the regulation regarding online portability.
- Small companies: with a maximum annual turnover of 30.000 Euro
How will consumers be supported in case of disputes with a trader who doesn’t comply with the Geo-blocking regulation?
Each member state establishes at least one body that supports consumers who face respective disputes with traders. They will advise consumers about their rights, intervene at the trader in another member state or forwards the consumer to other bodies if the case can’t be resolved directly. In Slovenia, the European Consumer Centre (ECC) has been given this task. You can submit your complaint through our usual channels (see Contact).
Source: https://ec.europa.eu/digital-single-market/en/faq/geo-blocking-faq
