Portability of digital services across the EU: Council adopts new rules

The Council today adopted new rules to allow consumers who paid for online content services in their home country to access them when visiting another country within the EU.

“Europeans travelling within the EU will no longer be cut off from online services such as films, sporting broadcasts, music, e-books or games they have paid for back home. Together with the ending of roaming charges, this is important progress in creating a digital single market which benefits everyone.”

Maltese Presidency

Access to subscriptions from abroad at no extra charge

The new regulation will improve competitiveness by encouraging innovation in online services and attracting more consumers. It is one of the objectives of the digital single market strategy to create a truly internal market for digital content and services.

It will apply to all online content services which are provided against payment of money. Free to air services, such as those provided by certain public broadcasters, will have the option of benefiting from the regulation provided that they verify the country of residence of their subscribers.

Current obstacles to cross-border portability of online services arise from the fact that the rights for the transmission of content protected by copyright such as audio-visual works as well as rights for premium sporting events are often licensed on a territorial basis. Online service providers may choose to serve specific markets only.

The provision of cross-border portability will not be subject to any additional charges.

Verification of member state of residence

The new measures will ensure equal access from abroad to content legally acquired or subscribed to in the member state of residence when on holidays, business trips or limited student stays.

To avoid abuses, service providers will verify the subscribers’ member state of residence. The verifications will be carried out in compliance with EU data protection rules.

The provider will be authorised to cease the access to the online service when the subscriber cannot prove his/her member state of residence.

The means of verification will be reasonable, proportionate and effective. It will consist of using no more than two criteria from a list of verification means. These may include an identity card, a bank account or credit card; the address of installation of the device for the supply of services; the payment by the subscriber of a licence fee for other services; an official billing or postal address; etc.

But copyright holders will have the possibility of authorising the use of their content without the obligation to verify the subscriber’s residence.

Entry into force

The new rules will start to apply in the first quarter of 2018 (nine months after its publication in the EU’s Official Journal).

Today’s decision follows an agreement reached on 7 February 2017 between the Maltese Presidency and the European Parliament. The Parliament voted its first reading position on 18 May 2017.

The regulation was adopted at a meeting of the Justice and Home Affairs Council, without discussion.

Background

The increased use of portable devices such as tablets and smartphones facilitates access to the use of online content services regardless of the consumers’ location.

There is rapidly growing demand on the part of consumers for access to content and innovative online services not only in their own country but also when they are away from home. As a result,  barriers that hamper access and use of online content services within the single market need to be eliminated.

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Portability of digital services across the EU: Council adopts new rules

The Council today adopted new rules to allow consumers who paid for online content services in their home country to access them when visiting another country within the EU.

“Europeans travelling within the EU will no longer be cut off from online services such as films, sporting broadcasts, music, e-books or games they have paid for back home. Together with the ending of roaming charges, this is important progress in creating a digital single market which benefits everyone.”

Maltese Presidency

Access to subscriptions from abroad at no extra charge

The new regulation will improve competitiveness by encouraging innovation in online services and attracting more consumers. It is one of the objectives of the digital single market strategy to create a truly internal market for digital content and services.

It will apply to all online content services which are provided against payment of money. Free to air services, such as those provided by certain public broadcasters, will have the option of benefiting from the regulation provided that they verify the country of residence of their subscribers.

Current obstacles to cross-border portability of online services arise from the fact that the rights for the transmission of content protected by copyright such as audio-visual works as well as rights for premium sporting events are often licensed on a territorial basis. Online service providers may choose to serve specific markets only.

The provision of cross-border portability will not be subject to any additional charges.

Verification of member state of residence

The new measures will ensure equal access from abroad to content legally acquired or subscribed to in the member state of residence when on holidays, business trips or limited student stays.

To avoid abuses, service providers will verify the subscribers’ member state of residence. The verifications will be carried out in compliance with EU data protection rules.

The provider will be authorised to cease the access to the online service when the subscriber cannot prove his/her member state of residence.

The means of verification will be reasonable, proportionate and effective. It will consist of using no more than two criteria from a list of verification means. These may include an identity card, a bank account or credit card; the address of installation of the device for the supply of services; the payment by the subscriber of a licence fee for other services; an official billing or postal address; etc.

But copyright holders will have the possibility of authorising the use of their content without the obligation to verify the subscriber’s residence.

Entry into force

The new rules will start to apply in the first quarter of 2018 (nine months after its publication in the EU’s Official Journal).

Today’s decision follows an agreement reached on 7 February 2017 between the Maltese Presidency and the European Parliament. The Parliament voted its first reading position on 18 May 2017.

The regulation was adopted at a meeting of the Justice and Home Affairs Council, without discussion.

Background

The increased use of portable devices such as tablets and smartphones facilitates access to the use of online content services regardless of the consumers’ location.

There is rapidly growing demand on the part of consumers for access to content and innovative online services not only in their own country but also when they are away from home. As a result,  barriers that hamper access and use of online content services within the single market need to be eliminated.

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More transparent cross-border parcel delivery services – Council agrees its stance

Cross-border parcel delivery services in the EU are set to become more transparent and better monitored. Increased price transparency and more effective oversight should make the market more efficient and help bring down those tariffs which are not fully justified by objective factors such as wages or geographical distance. The Council today agreed its position (a ‘general approach’) on the draft regulation, which is part of EU efforts to boost e-commerce under the digital single market. 

Under the Council general approach, the Commission will set up a website to display the cross-border delivery rates offered by delivery firms. This dedicated website will make it easier for consumers and companies to compare rates and choose the best ones. Small delivery companies will be excluded from the obligation to provide their rates as that would create an excessive administrative burden for both the companies and the national administrations collecting the information. 

More transparent and, ultimately, cheaper pricing is expected to bolster cross-border online purchases in the EU. While 44% of consumers buy online in their own country, only 15% order online from another member state, citing high delivery charges as one of the main reasons for avoiding cross-border purchases. Cheaper and more transparent pricing could also encourage more retailers to sell online. 

“We hope these new rules will lower delivery prices for citizens, especially those living in rural areas, and also for small businesses, which have limited negotiating power to strike good delivery deals,” said the Maltese presidency. 

The draft rules also give regulators powers to monitor developments in the parcel delivery market better. Delivery firms will have to provide their national regulator with various sets of data, thereby enabling the regulators to assess prices and identify market failures. Regulators in several countries currently do not have access to such data, which hampers the monitoring of competition in the parcel markets. 

The Council text includes special provisions for the monitoring and, where required, assessment of prices offered by universal service providers. These operators are required to provide affordable and cost-oriented services and receive certain concessions in return, such as exemption from VAT. The penalties to be imposed in the event of infringements will be laid down by member states. A non-confidential version of the assessment will be published by the Commission on the dedicated website. 

The adoption of the text requires approval by both the Council and the European Parliament.

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New rules for contracts for the supply of digital content – Council adopts its position

On 8 June, the Council adopted its position on the directive setting out new rules for business-to-consumer contracts for the supply of digital content and digital services.

The objective of the new rules is to provide a high level of protection and legal certainty to European consumers, in particular when buying cross-border as well as to make it easier for businesses, especially SMEs, to sell EU-wide.

“Be it online music and films, Apps, services such as Facebook or YouTube, these new rules will give more certainty to consumers and suppliers when purchasing and selling cross-border. It is an ambitious yet a delicate and balanced compromise that is about guaranteeing rights for European consumers while allowing for the possibility to create new business opportunities for EU companies through the promotion of innovation and competition.”

Maltese presidency

Main elements of the Council’s position

The major elements of the compromise reached by the Council’s relate to:

  • the scope of the directive, in particular embedded digital content, ‘over the top’ interpersonal communication services (OTTs), bundle contracts and the processing of personal data. On the latter aspect, the text foresees that consumers should be entitled to contractual remedies not only under contracts where they pay a price for the digital content or service but also in cases where they only provide personal data that will be processed by suppliers. However, where the personal data are exclusively processed by the supplier for the supply of the digital content or service, or for the supplier to comply with legal requirements to which the supplier is subject, the directive shall not apply.
  • the remedies for lack of supply and non-conformity. With a view to preserving both the interests of consumers and suppliers, the text foresees that suppliers should be allowed a “second chance” in case of lack of supply before the contract can be terminated. On non-conformity, the text provides more flexibility for the implementation at national level by setting out the conditions for the use of the different remedies rather than establishing a strict hierarchy between the different remedies.
  • the time limits for the supplier’s liability. To take into account the differences at national level, the compromise text does not fully harmonise prescription or guarantee periods, but sets that the liability of the supplier for cases of lack of conformity may not be shorter than two years.
  • the period of the reversal of the burden of the proof. This period during which the burden of the proof for lack conformity rests on the supplier is set at one year.

Background

The directive concerns business-to-consumer (B2C) contracts for the supply of digital content and covers: data produced and supplied in digital form (e.g. music, online video, etc.), services allowing for the creation, processing or storage of data in digital form (e.g. cloud storage), services allowing for the sharing of data (e.g. Facebook, YouTube, etc.) and any durable medium used exclusively as a carrier of digital content (e.g. DVDs).

The proposed directive on certain aspects concerning contracts for the supply of digital content was presented by the Commission on 9 December 2015 together with a proposal for a directive on certain aspects concerning contracts for the online and other distances sales of goods.

Next steps

Negotiations with the Parliament will start once the latter has adopted its position, most likely during autumn.

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