Geo-blocking: Discussion with MEP Comodini Cachia & stakeholders
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“Apologies, not available in your country!” A frequent experience for Maltese consumers. An E-commerce Europe barometer reveals that two in three cross-border shopping attempts in the EU fail due to restrictions or re-routing of customers based on discrimination on grounds of nationality or residence.
On the business side Commission findings reveal that while 65% of consumers buy online only 16% of SMEs sell online and only 7.5% of SMEs sell online across borders.
This phenomenon of geo-blocking was discussed on Friday in a stakeholders dialogue with MEP Therese Comodini Cachia, organised by the Malta Business Bureau and the European Parliament Information Office.
The discussion included the participation of Erwan Bertrand from Eurochambres, Dr Greta Agius, presently leading negotiations on topic on behalf of the Maltese Presidency, and representatives from business and consumer organisations.
Mr Joe Tanti, MBB CEO, introduced the debate by highlighting the need to include Maltese stakeholders in discussions with decision-makers with a view to shaping European Union law, which needs to reflect the particular situations in the different Member States including Malta.
The discussion takes place while the European Parliament and the Council are negotiating new legislation to address geo-blocking and prohibit restrictions by traders and re-routing practices online. However, the Commission proposal, while meant to lead to a wider consumer choice, is not without problems to businesses.
Erwan Bertrand from Eurochambres in fact expressed the concern of European Businesses as to the effectiveness of the proposed Commission measures in widening cross-border trade. Mr Bertrand points out that while Union legislation may try to prohibit certain commercial practices, a series of other limitations remain, including different technical requirements, language barriers and transport costs.
These point to the very shortcomings of the single market today according to Bertrand. ‘We would have preferred not to need any proposal on geoblocking, as this is a symptom of a still highly incomplete Single Market’ Bertrand said.
MEP Therese Comodini Cachia, rapporteur on the copyright Directive presented her role in the European Parliament in relation to the e-commerce package and the ongoing negotiations in the European Parliament.
The MEP stressed that any legislative intervention should remain proportionate, in particular for SMEs which should not be subject to an obligation to sell in other Member States.
The MEP also pointed out that while we need to unblock the internet’s potential in Europe, in Malta we need to take a closer look at the inherent inhibitions of companies to go online especially the prohibitive transport costs for these to offer their goods and service abroad.
“Within the Maltese scenario I see a number of local traders trying to taking the digital plunge but they face steep barriers among which postal costs. We need to help them address these barriers which are limiting their power to compete online,” she said.
The session included a round-table with stakeholders representing Maltese businesses which pointed out the need to keep in mind the burden of new rules on small business. Chamber of Commerce representative Andre Fenech pointed out that disproportionate regulation might have the counter effect of pushing companies to go offline to avoid claims from consumers abroad.
Similar concerns were voiced by GRTU representatives who also stressed the need to communicate better the ongoing initiatives in the digital single market which, although noble in intention, need more communication with businesses.
Phyllis Bezzina from the European Consumer Centre said that consumers in Malta encounter a lot of discrimination including blocking of access to websites and rerouting to other websites. Bezzina pointed out that often the justification provided by suppliers is very unconvincing and calls for clearer rules in this regard.
Representatives of the Malta Competition and Consumer Affairs Authority pointed out the need of a fair balance between trader and consumer as well as to the critical role of enforcement of existing rules.
The discussion featured also interventions by representatives by the GRTU, Malta IT Law Association, GVZH Advocates, MEUSAC and the Malta Communications Authority.