The European Commission is soliciting views and comments of interested stakeholders about the preliminary findings of the sector inquiry on e-commerce. The Commission’s findings are illustrated in a Preliminary Report published on 15 September 2016. The consultation will be open until 18 November 2016.
The European Commission launched the sector inquiry on the e-commerce in May 2015, at the same time it adopted the Digital Single Market Strategy. In March 2016 the Commission revealed the first findings of the sector inquiry on geo-blocking practices, a class of commercial behaviors whereby retailers and service providers prevent online shoppers from purchasing consumer goods or accessing digital content services because of the shopper’s location or country of residence. The adoption of the Preliminary Report – and the related consultation – is the last step before the adoption of the Final Report, scheduled for the first quarter of 2017. In the Final Report, the European Commission will take into account the comments submitted during the ongoing consultation.
The findings of the Preliminary Report
On the one side, the Preliminary Report confirms that the growth of the e-commerce is an important driver of price transparency and price competition, as it increases consumers’ choice. On the other, it also identifies certain business practices that may limit online competition both for the sale of consumer goods and for the access to digital content.
In the online sale of consumer good, the fast growth of e-commerce has been mirrored by the reaction of the manufacturers that have adopted business practices aimed at better controlling product distribution and brands positioning, namely through a wider use of selective distribution systems. At the same time, manufacturers have increased the use of contractual sales restrictions in their distribution agreements. In the Preliminary Report, the Commission considers that these types of contractual restrictions may have negative effects, as they may make cross-border shopping or online shopping more difficult and ultimately harm consumers by preventing them from benefiting from greater choice and lower prices in e-commerce.
With respect to digital content, the Preliminary Report contains an assessment of copyright licensing agreements which are complex and often exclusive. In particular, the report considers whether certain licensing practices restrict competition and whether enforcement of the EU competition rules by the Commission is necessary in order to ensure effective competition. In this regard, the Preliminary Report concludes that the Commission will need to assess the lawfulness of licensing practices on a case-by-case basis, having regard to the characteristics of the specific product and geographic markets.
Public consultations on European Commission’s inquiry reports represent an extremely useful tool for market operators to ensure that their views and needs are taken into account by the Commission when preparing proposals that have a concrete impact on EU laws.