E-Commerce Transactions (Laura Edgar)
Part 1: E-Commerce Law and Business Models
E-COMMERCE LAW AND BUSINESS MODELS
I. Overview
 Supplying products and services online
o How law applies to the business
o Consumer protection law
 No particular jurisdictional focus > UK, US, EU
as main sources of examples
 Sources of e-commerce law
o National/regional substantive law
o Transnational guidance, model laws > not law
per se but looked at and incorporated in state
law
o Private agreements and practices
*E-commerce in B2B is usually focused on
particular markets > eg airline industries;
chemical industries
 Objectives of Course
o How to identify potential legal problems
o Assess risk > real issues that will affect the
business
o Extend legal advice beyond the law >
business process and technology operation
When looking at a website, is it clear: (1)
where the company is located; (2) does it
outsource activities and what is the structure
of the business owned by the same company;
(3) how is the liability balanced among the
parties involved
 What can be sold/supplied > affects how law
treats it
o Physical products
o Information
o Digital products ~ software, music downloads
 Access to information ~ databases (eg law
journals; Lexis Nexis)
o Services ~ anything which can be undertaken
digitally > doctors, legal, tutoring, social
media, eg linkedin
 “Free” services
o Return on the service is information
o Info is used in exchange for paid
services/digital products from others
 eg use of information to create a customer
profile > advertisers pay the provider for
the information to know what to advertise
to you
 potential clash in GDPR and business
interests in data collection > businesses
collect data but they don’t know purpose
yet
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II. Main Types of E-Commerce Activity
 Main Types:
o Selling directly
o Advertising
 Non-standard > targeted audience
 Standard > TV, radio ~ no particular target
o Data collection and analysis, and/or selling
results
o Intermediary between seller and buyer > eg
ebay, amazon, alibaba
 provides a trust environment for
consumers to make purchases
 it can function further, eg paraseller and
ebay > has impact on the liability of the
marketplace
o Services to make the sale possible
 Payment services (paypal through ebay)
 Trust services > reviews, eg tripadvisor
 Selling Directly
o Amazon
 Physical items
 Downloads and streaming
o But it can be non-exclusive > Amazon also
has many non-direct selling activities
 Intermediary (marketplace)
 Sales services
 Logistics services
 Cloud storage
 Information/content (Amazon prime)
 Advertising
o Websites offer ad space
 Banner advertising
 Click through advertising
 Google, FB, other sites offer targeted and
personalized advertising
o Revenue of website is derived from fees paid
by the advertisers
o Apparent functionality of a website is to
provide what attracts advertisers:
 Market to which to advertise
 Data to use for that purpose
 Data Collection and Analysis
o Core of Google and FB free services
 User pays for their service with data
 Data (personal information) is accepted to
be “remuneration” under EU Law
o “Data” includes:
 Tracking online activities ~ by cookies;
plugins
 Analysing uploads and communications

 Note: There is a new law in France re
false advertising, disinformation
o Business model: Exploitation of Data
Its aim is to make money from:
 Targeted third party advertising
 Selling aggregated analyses to traders
and manufacturers ~ what products do
consumers buy now and likely to buy next
 Intermediaries between Seller and Buyer
o Different types
 B2C
 B2B ~ usually sector-specific and involves
expensive products ~ eg airline engines;
chemicals where there is a need for trust
and identification of parties
 Sharing economy ~ airbnb, uber
o An intermediary aims to have no role in the
sales transactions ~ thus, no liability
 BUT Increasingly, they are becoming
more involved and play a greater role in
the sales process > THUS, there is a
greater risk assumed by them
 BUT European cases of Ebay; disputes
over Uber drivers’ employment status
> What role does the intermediary play ~
what relationship it has with the different
parties > results in different legal
treatment (eg uber being banned in other
countries or treated as taxi service)
 They may also be considered as
‘guarantor’ of some parts of the
transaction
o Network of mutual contracts
 Rulebook model
o Income sources:
 Transaction fees
 Service fees
 Services to Facilitate Transactions
o Infrastructure services
 Web hosting, cloud storage
o Facilitation services
 Payment services ~ visa, paypal
 Identity services
 E-signature services > Digital identity
needs to be established, usually in
interactions with the State
~ eg Estonia
~ Valuable service because you want
to identify parties in commercial
transactions
 Notaries
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 Credit reference agencies > Seller
wants to ensure that customer is
credit worthy ~ also involves ML and
terrorism issues
 Trust services
 Accreditation services (eg Trusted
Shops) ~ usually with money-back
guarantees > shows the customers
that they are dealing with legitimate
sellers and would have no problem
 Inspection and audit (Alibaba) ~ to
check production methods of supplier
or manufacturer ~ onsite inspection to
pass information back to client
 Digital Content
o Subscription model (services)
 Streaming
 Downloads, expiring with subscription
 Spotify
o Download model (digital product)
 Pay per download
 Restrictions on use/copying
 itunes, amazon music
o Legal governance
 Primarily governed by contracts law
 BUT IP also on:
 Who owns the IPRs
 Do distributors have licenses
 eg using music in a video uploaded in
Youtube > US case where baby was
dancing with a popular song of Prince in
the background > found to be covered by
Fair Use
 Flexibility and Innovation
o Each function can be performed by a different
legal entity > by outsourcing the activities of a
named business
 but as far as the customer is concerned,
there is one service only
 there is no fixed infrastructure for
outsourcing
 outsourcing is highly influenced by
TAXATION ~ how to reduce tax on
valuable assets ~ eg offshore companies
where tax is less
 tax is determined by place of
establishment or place of performance
o Relationship between entities is defined by
contract
o Can be used to secure legal advantages >
existence/absence of regulators in different
jurisdictions
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o Issues arise when assets are not owned by
the e-commerce company
 where is the value of the business (eg
IPRs); where should they be located
 value of amazon at the start was in its
contractual relationships with book
wholesalers
 money is usually kept in low tax
jurisdictions

 Role of Law in E-Commerce

o Contract Law
 Establishes the back-end relationships
which give value to the business
 Controls customer terms

o IP Law
 IPs are key business assets> eg software,
content, trademarks

o Everything else
 Establishes the trading environment within
which businesses carry out their business
 Real estate; employment ~ depends on
the trading environment > what does the
business do which work well within the
legal framework and what does not work
within the legal framework
 Look at terms and conditions > location;
outsourcing

III. E-COMMERCE LAW AND BUSINESS
MODELS
A. Questions to Ask (re e-commerce
websites)
 What kind of business model is the business
using?
 Does the business perform all functions by
itself, or is it clear that important functions are
performed by third parties?
 What can I find out about the business
structure (often, this information is hidden in
the customer terms or in an “About” or
“Corporate information” link)?
 Good places to start include:
Google, Amazon, Skype, eBay, MySpace or
Facebook, YouTube, iTunes
IV. Business Models on the Web (Michael
Rappa)
 Background: The web has changed traditional
business models
 Business Model, defined
o the method of doing business by which a
company can sustain itself (generate revenue)
o it spells out how a company makes money by
specifying where it is positioned in the value
chain
o it has taken on greater importance recently as
a form of intellectual property > business
methods relevant to e-commerce have been
protected as a patent
 Sample Models
o Simple: Company produces a good or service
and sells to customers > If sales exceed
operational costs, there is profit
o Intricate: Broadcasting > TV and radio
programs are broadcasted to anyone with a
receiver > Those who make money from
broadcasting is not always clear at the start ~
series of distributors, content creators,
advertisers, their agencies, listeners, viewers
o Internet Commerce > likely to reinvent tried-
and-true models, eg auctions > internet
business models continue to evolve > a firm
may combine several different models as part
of its overall internet business strategy
 Basic Categories of Business Models
1) Brokerage
o Brokers as market-makers, bringing buyers
and sellers together and facilitating
transactions
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o Brokers are frequently in business-to-business
(B2B), business-to-consumer (B2C), or
consumer-to-consumer (C2C) markets
o Brokers usually charge a fee or commission
for each transaction it enables
o Brokerage Models
 Marketplace Exchange
- full range of services covering the
transaction process, from market
assessment to negotiation and fulfilment
- exchanges operate independently or are
backed by an industry consortium
- eg Orbitz, ChemConnect
 Buy/Sell Fulfilment
- takes customer orders to buy or sell a
product or service
- includes terms like price and delivery
- eg CarsDirect, Respond.com
 Demand Collection System
- name-your-price model – pioneered and
patented by Priceline.com
- prospective buyer makes a final bid
(binding) for a specified good or service,
and the broker arranges fulfilment
 Auction Broker
- conducts auctions for sellers
- broker charges a listing fee and
commission scaled with the value of the
transaction
- eg eBay
 Transaction Broker
- provides a third party payment mechanism
for buyers and sellers to settle a
transaction
- eg PayPal, Escrow.com
 Distributor
- catalog operation that connects a large
number of product manufacturers (with
volume) and retail buyers
- broker facilitates business transactions
between franchised distributors and
trading partners
 Search Agent
- a software agent or robot
- searches out the price and availability for a
good or service specified by the buyer
- locates hard to find information
 Virtual Marketplace
- virtual mall
- a hosting service for online merchants that
charges setup, monthly listing, and/or
transaction fees

- may provide automated transaction and
relationship marketing services
- eg Amazon
2) Advertising
o an extension of the traditional media broadcast
model
o website (broadcaster) provides content
(usually for free) and services (like emails or
blogs) mixed with advertising messages
(banner ads)
o banner ads may be the sole or major source of
revenue for the broadcaster
o broadcaster as content creator or distributor of
content
o works best when volume of viewer traffic is
large or highly specialized
o Models
 Portal – usually a search engine that may
include varied content or services (eg Yahoo)
> seeks to drive a high volume of traffic to one
site
 Classified – list of items for sale or wanted for
purchase; may have a listing or membership
fee (eg Monster.com, Craigslist)
 User Registration – content-based sites that
require users to register and provide
demographic data > inter-session tracking of
user surfing habits > data of potential value in
targeted advertising campaigns (eg NYTimes)
 Query-based Paid Placement – sells
favorable link positioning (sponsored links) or
advertising keyed to particular search terms in
a user query (eg Google, Overture)
 Contextual Advertising / Behavioral
Marketing – freeware developers bundle
adware with their product > sells targeted
advertising based on individual user’s surfing
activity
 Content-Targeted Advertising – pioneered
by Google > identifies the meaning of a web
page then automatically delivers relevant ads
when a user visits that page (eg Google)
 Intromercials – animated full-screen ads
placed at the entry of a site before a user
reaches the intended content (eg CBS
MarketWatch)
 Ultramercials – interactive online ads that
require the user to respond intermittently to
wade through the message before reaching
the intended content (eg Salon and Mercedez-
Benz)
3) Infomediary
o firms which assist buyers and/or sellers to
understand a given market
o consumer data, including consumption habits,
can be valuable as it can be used to target
marketing campaigns
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o producer data, including their products, can be
useful to consumers
o Models
 Advertising Networks
- feed banner ads to a network of member
sites > enables advertisers to deploy large
marketing campaigns
- collect data about web users that can be
used to analyse marketing effectiveness
- eg DoubleClick
 Audience Measurement Services – online
audience market research agencies (eg
Nielsen, Netratings)
 Incentive Marketing – customer loyalty
programs providing incentives to customers ~
redeemable points, coupons > user data sold
for targeted advertising (eg Coolsavings)
 Metamediary – facilitates transactions
between buyer and sellers by providing
comprehensive information and ancillary
services > not involved in the actual exchange
of goods or services (eg Edmunds)
4) Merchant
o wholesalers and retailers of goods and
services
o sales may be based on list prices or by auction
o Models
 Virtual Merchant – e-tailer; a retail merchant
that operates solely over the web (eg Amazon)
 Catalog Merchant – mail-order business with
web-based catalog > orders via mail,
telephone, online ordering (eg Lands’ End)
 Click and Mortar – traditional brick-and-
mortar retail establishment with web storefront
(eg Barnes & Noble)
 Bit Vendor – a merchant that deals strictly in
digital products and services > conducts both
sales and distribution over the web (eg Apple
iTunes Music Store)
5) Manufacturer (Direct)
o predicated on the power of the web to allow a
manufacturer to reach buyers directly >
compresses the distribution channel (eg Dell
Computer)
o Models
 Purchase – sale of a product > right of
ownership is transferred to buyer

 Lease – for a rental fee, the buyer receives
the right to use the product > under a “terms of
use” agreement
 License – sale of a product that involves the
transfer of usage rights to the buyer (eg
software licensing)
 Brand Integrated Content – created by the
manufacturer for the sole basis of product
placement > opposite of sponsored-content
approach (advertising model)
6) Affiliate
o inherently well-suited for the web and popular
o offers financial incentives (revenue
percentage) to affiliated partner sites
o affiliates provide purchase-point click-through
to the merchant > purchase opportunities are
wherever people may be surfing
o pay-for-performance model > if an affiliate
does not generate sales, it represents no cost
to the merchant
o eg Barnes & Noble; Amazon
o Models
 Banner Exchange – trades banner placement
among a network of affiliated sites
 Pay-Per-Click – site that pays affiliates for a
user click-through
 Revenue Sharing – offers a percent-of-sale
commission based on a user click-through in
which the user subsequently purchases a
product
7) Community
o based on user loyalty > high investment in
time and emotion
o revenue based on: (a) sale of ancillary
products and services; (b) voluntary
contribution; (c) contextual advertising and
subscription for premium services
o one of the more fertile areas of development
as seen in the rise of social networking
o Models
 Open Source
- software is developed collaboratively by a
global community of programmers who
share code openly
- instead of licensing code for a fee, open
source relies on revenue generated from
related services, like systems integration,
product support, tutorials, user
documentation
- eg Red Hat
 Open Content – openly accessible content
developed collaboratively by a global
community of contributors who work voluntarily
(eg Wikipedia)
 Public Broadcasting
- user-supported model
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- used by non-for-profit radio and television
broadcasting extended to the web
- site is supported by voluntary donations of
users
- eg wcpe.org
 Social Networking Services
- sites that enable individuals to connect to
other individuals along a defined common
interest
- can provide opportunities for contextual
advertising and subscription from premium
services
- eg Flickr, Friendster
8) Subscription
o users are charged a periodic fee to subscribe
to a service > incurred irrespective of actual
usage rates
o common to combine free content with
premium content
o frequently combined with advertising models
o Models
 Content Services – provide text, audio, or
video content to users who subscribe for a fee
to gain access to the service > eg Netflix
 Person-to-Person Networking Services –
conduit for distribution of user-submitted
information ~ individuals searching for former
schoolmates > eg Classmates
 Trust Services – membership associations
that abide by an explicit code of conduct >
members pay a subscription fee
 Internet Services Providers – offer network
connectivity and related services on a monthly
subscription
9) Utility
o On-Demand Model, based on metering usage
> metered services are based on actual usage
rates
o Pay As You Go approach
o eg internet service providers
o Models
 Metered Usage – bills users based on actual
usage of a service
 Metered Subscriptions – purchase of access
to content in metered portions (eg no. of pages
viewed)

V. European Ecommerce Report (2019)
 Organizations
o Ecommerce Europe / European
Ecommerce Association
 voice of the European digital commerce sector
 has 19 national e-commerce associations
 represents more than 75,000 companies
selling goods and services online to
consumers in Europe
o EuroCommerce
 principal European organization representing
the retail and wholesale sector
 members include Carrefour, Ikea, Metro,
Tesco
 Overview of Europe
o Europe population continues to increase >
2019 at 798.4 million
o Largest population at Western Europe
(31.16%)
o Online shoppers are typically between the
ages 18-55 (42.23%)
 Infrastructure, Logistics, and Landscape
o Scandinavian countries rank high in important
ecommerce indices:
 Ease of Doing Business: Denmark (3)
 Logistics Performance Index: Germany (1)
 E-government Development Index: UK (4)
o Northern Europe has the highest internet
penetration among the regions (93.3%) >
Iceland with highest (99%) and Ukraine with
lowest (64%)
o Online shopping ranges from 88%
(Switzerland) to 22% (Ukraine)
o E-commerce turnover in 2019 is estimated at
EUR 621 billion (13% growth) > concentrated
in Western Europe (66%)
o Northern Europe has highest spending per e-
shopper
 Lowest in Eastern Europe
 Kosovo and Montenegro are more likely to
refrain from ordering online due to: (1)
preference to shop in person; (2) desire to
see the product; (3) loyalty to shops; (4)
force of habit
o Leading marketplaces are Amazon, eBay,
AliExpress
 Marketplaces are a way for SMEs, who
may not have the resources to set up their
own online channel, to reach consumers in
the digital world
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 eBay
- American multinational ecommerce
corporation with the aim of facilitating
C2C and B2B sales
- Founded in 1995 by Pierre Omidyar
as AuctionWeb; renamed to eBay in
1997
- HQ at San Jose (Silicon Valley),
California
- Operates in 180 countries
- British consumers buy more eBay
items a month per capita than any
other country
 Etsy
- An e-commerce website focused on
handmade and vintage items
- Typically C2C
- Founded by Rob Kalin; from “eh si”,
meaning “oh, yes”
- Launched in 2005
 AliExpress
- An online retail service; solely an e-
commerce platform
- Founded in 2009 in China and owned
by Alibaba; made up mainly of small
businesses in China
- Began with B2B sales, and expanded
to B2C and C2C
- Sellers are independent; AliExpress
does not sell products directly to
consumers
- It does not allow customers in
mainland China to buy from the
platform > It was designed to sell to
overseas countries
 Amazon
- Operates retail and marketplace
activities
 Value of Marketplaces to SMEs
o SMEs may not have the resources to set up
their own online channel and reach consumers
in the digital world
o It extends SME’s geographical reach
o It increases customer reach by using
information on customers
o It achieves economies of scale and greater
efficiencies
o It achieves greater credibility and consumer
trust > consumers more confident in
transactions from well-known marketplaces

VI. E-Commerce Directive
 Title and Date
o Directive 2000/31/EC of the European
Parliament and of the Council on certain legal
aspects of information society services, in
particular electronic commerce, in the Internal
Market (Directive on Electronic Commerce)
o Dated 8 June 2000
 Recitals
o Directive aims to ensure a high level of
Community legal integration in order to
establish a real area without internal borders
for information society services (W3); to create
a legal framework to ensure the free
movement of information society services
between Member States (W8)
 Information Society Services cover any
service normally provided for
remuneration, at a distance, by means of
electronic equipment for the processing
(including digital compression) and
storage of data, and at the individual
request of a recipient of a service (W17)
 Wide range of economic activities which
take place online (W18)
 Consists of selling goods online (online
contracting); services which are not
remunerated by those who received them
in so far as they represent an economic
activity ~ eg offering online information or
commercial communications, or providing
tools allowing for search, access, and
retrieval of data; providing access to a
communication network or hosting
information provided by a recipient of the
service; providing commercial
communications by electronic mail (W18)
 Supervised at the source of the activity
and subject to the law of the Member
State in which the service provider is
established (W22)
o Development of ecommerce within the
information society offers: (1) significant
employment opportunities in the Community,
particularly in small and medium-sized
enterprises; (2) stimulates economic growth
and investment in innovation by European
companies; and (3) enhance the
competitiveness of European industry (W2)
o Legal uncertainty exists with regard to: (1)
which national rules apply to information
society services; (2) the extent to which
Member States may control services
originating from another Member State (W5)
o Concept of Establishment involves the
actual pursuit of an economic activity through
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a fixed establishment for an indefinite period
(W19)
 It is not the place at which the technology
supporting its website is located or the
place at which its website is accessible
 It is the place where it pursues its
economic activity
 If several, it is the place where the
provider has the centre of his activities
relating to a given service
o Scope of Directive > coordinated field covers
only requirements relating to online activities,
such as online information, online advertising,
online shopping, and online contracting (W21)
 It does not concern legal requirements
relating to goods, eg, safety standards,
labelling obligations, liability for goods,
delivery requirements
CHAPTER I: GENERAL PROVISIONS
 Article 1. Objective and Scope
Objective
1. This Directive seeks to contribute to the proper
functioning of the internal market by ensuring
the free movement of information society
services between the Member States.
Scope
2. This Directive approximates, to the extent
necessary for the achievement of the objective
set out in paragraph 1, certain national
provisions on information society services
relating to:
a. the internal market,
b. the establishment of service providers,
c. commercial communications,
d. electronic contracts,
e. the liability of intermediaries,
f. codes of conduct,
g. out-of-court dispute settlements,
h. court actions and
i. cooperation between Member States.
3. This Directive complements Community law
applicable to information society services
without prejudice to the level of protection
for, in particular, public health and consumer
interests, as established by Community acts
and national legislation implementing them in
so far as this does not restrict the freedom to
provide information society services.
4. This Directive does not establish additional
rules on private international law nor does it
deal with the jurisdiction of Courts.

5. This Directive shall not apply to:
a. the field of taxation;
b. questions relating to information society
services covered by Directives 95/46/EC
and 97/66/EC;
 Directive 95/46/EC of the European
Parliament and of the Council of 24
October 1995 on the protection of
individuals with regard to the processing
of personal data and on the free
movement of such data
REPEALED by the Regulation (EU)
2016/679 (General Data Protection
Regulation) of the European Parliament
and of the Council of 27 April 2016 on the
protection of natural persons with regard
to the processing of personal data and on
the free movement of such data.
 Directive 97/66/EC of the European
Parliament and of the Council of 15
December 1997 concerning the
processing of personal data and the
protection of privacy in the
telecommunications sector.
REPEALED by Directive 2002/58/EC of
the European Parliament and of the
Council of 12 July 2002 concerning the
processing of personal data and the
protection of privacy in the electronic
communications sector (Directive on
privacy and electronic
communications)
c. questions relating to agreements or
practices governed by cartel law;
d. the following activities of information
society services:
- the activities of notaries or equivalent
professions to the extent that they involve
a direct and specific connection with the
exercise of public authority,
- the representation of a client and defence
of his interests before the courts,
- gambling activities which involve wagering
a stake with monetary value in games of
chance, including lotteries and betting
transactions.
6. This Directive does not affect measures taken
at Community or national level, in the respect
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of Community law, in order to promote
cultural and linguistic diversity and to
ensure the defence of pluralism.
 Article 2. Definitions
For the purpose of this Directive, the following
terms shall bear the following meanings:
(a) "information society services": services
within the meaning of Article 1(2) of Directive
98/34/EC as amended by Directive 98/48/EC;
 REPEALED by Directive (EU) 2015/1535
of the European Parliament and of the
Council of 9 September 2015 laying down
a procedure for the provision of
information in the field of technical
regulations and of rules on Information
Society services.
 Article I, Section 1, par. b provides: (b)
‘service’ means any Information Society
service, that is to say, any service
normally provided for remuneration, at
a distance, by electronic means and at
the individual request of a recipient of
services.
For the purposes of this definition:
(i) ‘at a distance’ means that the service is
provided without the parties being
simultaneously present;
(ii) ‘by electronic means’ means that the
service is sent initially and received at its
destination by means of electronic
equipment for the processing (including
digital compression) and storage of data,
and entirely transmitted, conveyed and
received by wire, by radio, by optical
means or by other electromagnetic
means;
(iii) ‘at the individual request of a recipient
of services’ means that the service is
provided through the transmission of data
on individual request.
(b) "service provider": any natural or legal
person providing an information society
service;
(c) "established service provider": a service
provider who effectively pursues an economic
activity using a fixed establishment for an
indefinite period. The presence and use of the
technical means and technologies required to
provide the service do not, in themselves,
constitute an establishment of the provider;

(d) "recipient of the service": any natural or
legal person who, for professional ends or
otherwise, uses an information society service,
in particular for the purposes of seeking
information or making it accessible;
(e) "consumer": any natural person who is acting
for purposes which are outside his or her
trade, business or profession;
(f) "commercial communication": any form of
communication designed to promote, directly
or indirectly, the goods, services or image of a
company, organisation or person pursuing a
commercial, industrial or craft activity or
exercising a regulated profession.
The following do not in themselves constitute
commercial communications:
- information allowing direct access to the
activity of the company, organisation or
person, in particular a domain name or an
electronic-mail address,
- communications relating to the goods,
services or image of the company,
organisation or person compiled in an
independent manner, particularly when
this is without financial consideration;
(g) "regulated profession": any profession within
the meaning of either Article 1(d) of Council
Directive 89/48/EEC of 21 December 1988 on
a general system for the recognition of higher-
education diplomas awarded on completion of
professional education and training of at least
three-years' duration or of Article 1(f) of
Council Directive 92/51/EEC of 18 June 1992
on a second general system for the
recognition of professional education and
training to supplement Directive 89/48/EEC;
(h) "coordinated field": requirements laid down
in Member States' legal systems applicable to
information society service providers or
information society services, regardless of
whether they are of a general nature or
specifically designed for them.
(i) The coordinated field concerns
requirements with which the service
provider has to comply in respect of:
- the taking up of the activity of an
information society service, such as
requirements concerning qualifications,
authorisation or notification,
- the pursuit of the activity of an information
society service, such as requirements
concerning the behaviour of the service
provider, requirements regarding the
quality or content of the service including
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those applicable to advertising and
contracts, or requirements concerning the
liability of the service provider;
(ii) The coordinated field does not cover
requirements such as:
- requirements applicable to goods as such,
- requirements applicable to the delivery of
goods,
- requirements applicable to services not
provided by electronic means.
 Article 3. Internal Market
1. Each Member State shall ensure that the
information society services provided by a
service provider established on its territory
comply with the national provisions applicable
in the Member State in question which fall
within the coordinated field.
2. Member States may not, for reasons falling
within the coordinated field, restrict the
freedom to provide information society
services from another Member State.
3. Paragraphs 1 and 2 shall not apply to the
fields referred to in the Annex.
- copyright, neighbouring rights, rights
referred to in Directive 87/54/EEC(1) and
Directive 96/9/EC(2) as well as industrial
property rights,
- the emission of electronic money by
institutions in respect of which Member
States have applied one of the derogations
provided for in Article 8(1) of Directive
2000/46/EC(3),
- Article 44(2) of Directive 85/611/EEC,
 Any undertakings for collective
investment in transferable securities
(UCITS) may advertise its units in the
Member State in which they are
marketed. It must comply the provisions
governing advertising in that State.
 REPEALED by Directive 2009/65 / EC
of the European Parliament and of the
Council of 13 July 2009 on the
coordination of laws, regulations and
administrative provisions relating to
undertakings for collective investment in
transferable securities (UCITS).
 No parallel provision in Directive
2009/65/EC.

- Article 30 and Title IV of Directive
92/49/EEC, Title IV of Directive 92/96/EEC,
Articles 7 and 8 of Directive 88/357/EEC and
Article 4 of Directive 90/619/EEC,
- the freedom of the parties to choose the law
applicable to their contract,
- contractual obligations concerning consumer
contacts,
- formal validity of contracts creating or
transferring rights in real estate where such
contracts are subject to mandatory formal
requirements of the law of the Member State
where the real estate is situated,
- the permissibility of unsolicited commercial
communications by electronic mail.
4. Member States may take measures to
derogate from paragraph 2 in respect of a
given information society service if the
following conditions are fulfilled:
a. the measures shall be:
i. necessary for one of the following
reasons:
- public policy, in particular the
prevention, investigation, detection
and prosecution of criminal
offences, including the protection of
minors and the fight against any
incitement to hatred on grounds of
race, sex, religion or nationality, and
violations of human dignity
concerning individual persons,
- the protection of public health,
- public security, including the
safeguarding of national security
and defence,
- the protection of consumers,
including investors;
ii. taken against a given information
society service which prejudices the
objectives referred to in point (i) or
which presents a serious and grave
risk of prejudice to those objectives;
iii. proportionate to those objectives;
b. before taking the measures in question
and without prejudice to court
proceedings, including preliminary
proceedings and acts carried out in the
framework of a criminal investigation, the
Member State has:
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- asked the Member State referred to in
paragraph 1 to take measures and the
latter did not take such measures, or
they were inadequate,
- notified the Commission and the
Member State referred to in paragraph 1
of its intention to take such measures.
5. Member States may, in the case of urgency,
derogate from the conditions stipulated in
paragraph 4(b). Where this is the case, the
measures shall be notified in the shortest
possible time to the Commission and to the
Member State referred to in paragraph 1,
indicating the reasons for which the Member
State considers that there is urgency.
6. Without prejudice to the Member State's
possibility of proceeding with the measures in
question, the Commission shall examine the
compatibility of the notified measures with
Community law in the shortest possible
time; where it comes to the conclusion that the
measure is incompatible with Community law,
the Commission shall ask the Member State in
question to refrain from taking any proposed
measures or urgently to put an end to the
measures in question.
CHAPTER II: PRINCIPLES
Section 1: Establishment and information
requirements
 Article 4. Principle excluding prior
authorisation
1. Member States shall ensure that the taking up
and pursuit of the activity of an information
society service provider may not be made
subject to prior authorisation or any other
requirement having equivalent effect.
2. Paragraph 1 shall be without prejudice to
authorisation schemes which are not
specifically and exclusively targeted at
information society services, or which are
covered by Directive 97/13/EC of the
European Parliament and of the Council of 10
April 1997 on a common framework for
general authorisations and individual licences
in the field of telecommunications services.
 Article 5. General information to be
provided
1. In addition to other information requirements
established by Community law, Member
States shall ensure that the service provider
shall render easily, directly and permanently
accessible to the recipients of the service and

competent authorities, at least the following
information:
a. the name of the service provider;
b. the geographic address at which the
service provider is established;
c. the details of the service provider,
including his electronic mail address,
which allow him to be contacted rapidly
and communicated with in a direct and
effective manner;
d. where the service provider is registered in
a trade or similar public register, the trade
register in which the service provider is
entered and his registration number, or
equivalent means of identification in that
register;
e. where the activity is subject to an
authorisation scheme, the particulars of
the relevant supervisory authority;
f. as concerns the regulated professions:
- any professional body or similar
institution with which the service
provider is registered,
- the professional title and the Member
State where it has been granted,
- a reference to the applicable
professional rules in the Member State
of establishment and the means to
access them;
g. where the service provider undertakes an
activity that is subject to VAT, the
identification number referred to in Article
22(1) of the sixth Council Directive
77/388/EEC of 17 May 1977 on the
harmonisation of the laws of the Member
States relating to turnover taxes -
Common system of value added tax:
uniform basis of assessment.
2. In addition to other information requirements
established by Community law, Member
States shall at least ensure that, where
information society services refer to prices,
these are to be indicated clearly and
unambiguously and, in particular, must
indicate whether they are inclusive of tax
and delivery costs.
Section 2: Commercial communications
 Article 6. Information to be provided
In addition to other information requirements
established by Community law, Member States
shall ensure that commercial communications
which are part of, or constitute, an information
society service comply at least with the following
conditions:
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(a) the commercial communication shall be
clearly identifiable as such;
(b) the natural or legal person on whose behalf
the commercial communication is made shall
be clearly identifiable;
(c) promotional offers, such as discounts,
premiums and gifts, where permitted in the
Member State where the service provider is
established, shall be clearly identifiable as
such, and the conditions which are to be met
to qualify for them shall be easily accessible
and be presented clearly and
unambiguously;
(d) promotional competitions or games, where
permitted in the Member State where the
service provider is established, shall be
clearly identifiable as such, and the
conditions for participation shall be easily
accessible and be presented clearly and
unambiguously.
 Article 7. Unsolicited commercial
communication
1. In addition to other requirements established
by Community law, Member States which
permit unsolicited commercial
communication by electronic mail shall
ensure that such commercial communication
by a service provider established in their
territory shall be identifiable clearly and
unambiguously as such as soon as it is
received by the recipient.
2. Without prejudice to Directive 97/7/EC and
Directive 97/66/EC, Member States shall take
measures to ensure that service providers
undertaking unsolicited commercial
communications by electronic mail consult
regularly and respect the opt-out registers
in which natural persons not wishing to receive
such commercial communications can register
themselves.
 Article 8. Regulated professions
1. Member States shall ensure that the use of
commercial communications which are part of,
or constitute, an information society service
provided by a member of a regulated
profession is permitted subject to compliance
with the professional rules regarding, in
particular, the independence, dignity and
honour of the profession, professional
secrecy and fairness towards clients and
other members of the profession.

2. Without prejudice to the autonomy of
professional bodies and associations, Member
States and the Commission shall encourage
professional associations and bodies to
establish codes of conduct at Community
level in order to determine the types of
information that can be given for the purposes
of commercial communication in conformity
with the rules referred to in paragraph 1.
3. When drawing up proposals for Community
initiatives which may become necessary to
ensure the proper functioning of the Internal
Market with regard to the information referred
to in paragraph 2, the Commission shall take
due account of codes of conduct applicable at
Community level and shall act in close
cooperation with the relevant professional
associations and bodies.
4. This Directive shall apply in addition to
Community Directives concerning access to,
and the exercise of, activities of the regulated
professions.
Section 3: Contracts concluded by electronic
means
 Article 9. Treatment of contracts
1. Member States shall ensure that their legal
system allows contracts to be concluded
by electronic means. Member States shall in
particular ensure that the legal requirements
applicable to the contractual process neither
create obstacles for the use of electronic
contracts nor result in such contracts being
deprived of legal effectiveness and validity on
account of their having been made by
electronic means.
2. Member States may lay down that paragraph
1 shall not apply to all or certain contracts
falling into one of the following categories:
a. contracts that create or transfer rights in
real estate, except for rental rights;
b. contracts requiring by law the
involvement of courts, public
authorities or professions exercising
public authority;
c. contracts of suretyship granted and on
collateral securities furnished by persons
acting for purposes outside their trade,
business or profession;
d. contracts governed by family law or by
the law of succession.
3. Member States shall indicate to the
Commission the categories referred to in
paragraph 2 to which they do not apply
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paragraph 1. Member States shall submit to
the Commission every five years a report on
the application of paragraph 2 explaining the
reasons why they consider it necessary to
maintain the category referred to in paragraph
2(b) to which they do not apply paragraph 1.
 Article 10. Information to be provided
1. In addition to other information requirements
established by Community law, Member
States shall ensure, except when otherwise
agreed by parties who are not consumers, that
at least the following information is given by
the service provider clearly, comprehensibly
and unambiguously and prior to the order
being placed by the recipient of the service:
a. the different technical steps to follow to
conclude the contract;
b. whether or not the concluded contract will
be filed by the service provider and
whether it will be accessible;
c. the technical means for identifying and
correcting input errors prior to the
placing of the order;
d. the languages offered for the conclusion of
the contract.
2. Member States shall ensure that, except when
otherwise agreed by parties who are not
consumers, the service provider indicates any
relevant codes of conduct to which he
subscribes and information on how those
codes can be consulted electronically.
3. Contract terms and general conditions
provided to the recipient must be made
available in a way that allows him to store
and reproduce them.
4. Paragraphs 1 and 2 shall not apply to
contracts concluded exclusively by exchange
of electronic mail or by equivalent individual
communications.
 Article 11. Placing of the order
1. Member States shall ensure, except when
otherwise agreed by parties who are not
consumers, that in cases where the recipient
of the service places his order through
technological means, the following principles
apply:
- the service provider has to acknowledge
the receipt of the recipient's order without
undue delay and by electronic means,
- the order and the acknowledgement of
receipt are deemed to be received when

the parties to whom they are addressed
are able to access them.
2. Member States shall ensure that, except when
otherwise agreed by parties who are not
consumers, the service provider makes
available to the recipient of the service
appropriate, effective and accessible technical
means allowing him to identify and correct
input errors, prior to the placing of the
order.
3. Paragraph 1, first indent, and paragraph 2
shall not apply to contracts concluded
exclusively by exchange of electronic mail or
by equivalent individual communications.
Section 4: Liability of intermediary service
providers
 Article 12. “Mere Conduit”
[Transmission, Provision of Access to
Communication Network, Storage]
1. Where an information society service is
provided that consists of the transmission in
a communication network of information
provided by a recipient of the service, or the
provision of access to a communication
network, Member States shall ensure that the
service provider is not liable for the
information transmitted, on condition that
the provider:
a. does not initiate the transmission;
b. does not select the receiver of the
transmission; and
c. does not select or modify the information
contained in the transmission.
2. The acts of transmission and of provision of
access referred to in paragraph 1 include the
automatic, intermediate and transient storage
of the information transmitted in so far as this
takes place for the sole purpose of carrying
out the transmission in the communication
network, and provided that the information is
not stored for any period longer than is
reasonably necessary for the transmission.
3. This Article shall not affect the possibility for a
court or administrative authority, in accordance
with Member States' legal systems, of
requiring the service provider to terminate or
prevent an infringement.
 Article 13. “Caching”
[Storage for onward transmission]
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1. Where an information society service is
provided that consists of the transmission in
a communication network of information
provided by a recipient of the service, Member
States shall ensure that the service provider is
not liable for the automatic, intermediate and
temporary storage of that information,
performed for the sole purpose of making
more efficient the information's onward
transmission to other recipients of the service
upon their request, on condition that:
a. the provider does not modify the
information;
b. the provider complies with conditions on
access to the information;
c. the provider complies with rules regarding
the updating of the information, specified
in a manner widely recognised and used
by industry;
d. the provider does not interfere with the
lawful use of technology, widely
recognised and used by industry, to obtain
data on the use of the information; and
e. the provider acts expeditiously to remove
or to disable access to the information it
has stored upon obtaining actual
knowledge of the fact that the information
at the initial source of the transmission has
been removed from the network, or access
to it has been disabled, or that a court or
an administrative authority has ordered
such removal or disablement.
2. This Article shall not affect the possibility for a
court or administrative authority, in accordance
with Member States' legal systems, of
requiring the service provider to terminate or
prevent an infringement.
 Article 14. Hosting
[Storage of information from and for recipient]
1. Where an information society service is
provided that consists of the storage of
information provided by a recipient of the
service, Member States shall ensure that the
service provider is not liable for the information
stored at the request of a recipient of the
service, on condition that:
a. the provider does not have actual
knowledge of illegal activity or
information and, as regards claims for
damages, is not aware of facts or
circumstances from which the illegal
activity or information is apparent; or
b. the provider, upon obtaining such
knowledge or awareness, acts

expeditiously to remove or to disable
access to the information.
2. Paragraph 1 shall not apply when the
recipient of the service is acting under the
authority or the control of the provider.
3. This Article shall not affect the possibility for a
court or administrative authority, in accordance
with Member States' legal systems, of
requiring the service provider to terminate or
prevent an infringement, nor does it affect the
possibility for Member States of establishing
procedures governing the removal or
disabling of access to information.
 Article 15. No general obligation to monitor
1. Member States shall not impose a general
obligation on providers, when providing the
services covered by Articles 12, 13 and 14, to
monitor the information which they
transmit or store, nor a general obligation
actively to seek facts or circumstances
indicating illegal activity.
2. Member States may establish obligations for
information society service providers promptly
to inform the competent public authorities
of alleged illegal activities undertaken or
information provided by recipients of their
service or obligations to communicate to the
competent authorities, at their request,
information enabling the identification of
recipients of their service with whom they
have storage agreements.
CHAPTER III: IMPLEMENTATION
 Article 16. Codes of Conduct
1. Member States and the Commission shall
encourage:
a. the drawing up of codes of conduct at
Community level, by trade, professional
and consumer associations or
organisations, designed to contribute to
the proper implementation of Articles 5 to
15;
b. the voluntary transmission of draft
codes of conduct at national or Community
level to the Commission;
c. the accessibility of these codes of conduct
in the Community languages by
electronic means;
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d. the communication to the Member States
and the Commission, by trade,
professional and consumer associations or
organisations, of their assessment of the
application of their codes of conduct
and their impact upon practices, habits or
customs relating to electronic commerce;
e. the drawing up of codes of conduct
regarding the protection of minors and
human dignity.
2. Member States and the Commission shall
encourage the involvement of associations or
organisations representing consumers in
the drafting and implementation of codes
of conduct affecting their interests and
drawn up in accordance with paragraph 1(a).
Where appropriate, to take account of their
specific needs, associations representing the
visually impaired and disabled should be
consulted.
 Article 17. Out-of-court dispute settlement
1. Member States shall ensure that, in the event
of disagreement between an information
society service provider and the recipient of
the service, their legislation does not hamper
the use of out-of-court schemes, available
under national law, for dispute settlement,
including appropriate electronic means.
2. Member States shall encourage bodies
responsible for the out-of-court settlement of,
in particular, consumer disputes to operate in
a way which provides adequate procedural
guarantees for the parties concerned.
3. Member States shall encourage bodies
responsible for out-of-court dispute settlement
to inform the Commission of the significant
decisions they take regarding information
society services and to transmit any other
information on the practices, usages or
customs relating to electronic commerce.
 Article 18. Court actions
1. Member States shall ensure that court actions
available under national law concerning
information society services' activities allow for
the rapid adoption of measures, including
interim measures, designed to terminate any
alleged infringement and to prevent any further
impairment of the interests involved.
2. The Annex to Directive 98/27/EC shall be
supplemented as follows:

“11. Directive 2000/31/EC of the European
Parliament and of the Council of 8 June 2000
on certain legal aspects on information society
services, in particular electronic commerce, in
the internal market (Directive on electronic
commerce) (OJ L 178, 17.7.2000, p. 1).”
 REPEALED by Directive 98/27/EC of the
European Parliament and of the Council of
19 May 1998 on injunctions for the
protection of consumers' interests.
 Article 19. Cooperation
1. Member States shall have adequate means of
supervision and investigation necessary to
implement this Directive effectively and shall
ensure that service providers supply them with
the requisite information.
2. Member States shall cooperate with other
Member States; they shall, to that end, appoint
one or several contact points, whose details
they shall communicate to the other Member
States and to the Commission.
3. Member States shall, as quickly as possible,
and in conformity with national law, provide the
assistance and information requested by
other Member States or by the
Commission, including by appropriate
electronic means.
4. Member States shall establish contact points
which shall be accessible at least by electronic
means and from which recipients and service
providers may:
a. obtain general information on contractual
rights and obligations as well as on the
complaint and redress mechanisms
available in the event of disputes,
including practical aspects involved in the
use of such mechanisms;
b. obtain the details of authorities,
associations or organisations from which
they may obtain further information or
practical assistance.
5. Member States shall encourage the
communication to the Commission of any
significant administrative or judicial
decisions taken in their territory regarding
disputes relating to information society
services and practices, usages and customs
relating to electronic commerce. The
Commission shall communicate these
decisions to the other Member States.
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 Article 20. Sanctions
Member States shall determine the sanctions
applicable to infringements of national provisions
adopted pursuant to this Directive and shall take
all measures necessary to ensure that they are
enforced. The sanctions they provide for shall be
effective, proportionate and dissuasive.
CHAPTER IV: FINAL PROVISIONS
 Article 21. Re-examination
1. Before 17 July 2003, and thereafter every two
years, the Commission shall submit to the
European Parliament, the Council and the
Economic and Social Committee a report on
the application of this Directive,
accompanied, where necessary, by proposals
for adapting it to legal, technical and economic
developments in the field of information
society services, in particular with respect to
crime prevention, the protection of minors,
consumer protection and to the proper
functioning of the internal market.
2. In examining the need for an adaptation of this
Directive, the report shall in particular analyse
the need for proposals concerning the liability
of providers of hyperlinks and location tool
services, "notice and take down"
procedures and the attribution of liability
following the taking down of content. The
report shall also analyse the need for
additional conditions for the exemption from
liability, provided for in Articles 12 and 13, in
the light of technical developments, and the
possibility of applying the internal market
principles to unsolicited commercial
communications by electronic mail.
 Article 22. Transposition
1. Member States shall bring into force the laws,
regulations and administrative provisions
necessary to comply with this Directive before
17 January 2002. They shall forthwith inform
the Commission thereof.
2. When Member States adopt the measures
referred to in paragraph 1, these shall contain
a reference to this Directive or shall be
accompanied by such reference at the time of
their official publication. The methods of
making such reference shall be laid down by
Member States.
 Article 23. Entry into force

This Directive shall enter into force on the day
of its publication in the Official Journal of the
European Communities.
 Article 24. Addressees
This Directive is addressed to the Member
States.
Done at Luxemburg, 8 June 2000.
VII. A Comprehensive Approach to Stimulating
Cross-Border E-Commerce for Europe’s
Citizens and Businesses
 From the European Commission to the
European Parliament, European Council, and
European Economic and Social Committee
and Committee of the Regions
 Dated 25 May 2016
 It is a proposal of e-commerce measures to
achieve the rapid removal of barriers to cross-
border online activity in Europe. These
measures are:
1. To prevent unjustified geo-blocking
2. To ensure better enforcement
3. To provide more competitively priced
parcel delivery
4. To harmonise contract law rules
5. To simplify VAT
 Context
o EU Commission adopted a Strategy for a
Digital Single Market and identified areas
where immediate action was required to
break down barriers to cross-border online
activity and to define an appropriate e-
commerce framework.
o These areas are:
1) Need to prevent discrimination or
unjustified differentiated treatment of
purchasers based in different Member
States
2) Need to build consumer trust in cross-
border online sales by ensuring:
- better enforcement of existing rules and
- the availability of affordable and high
quality cross-border parcel delivery
services
3) Need to reduce transaction costs and
other burdens:
- differences in contract law between
Member States
- VAT related administrative burden
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o Four Key Proposals to boost cross-border e-
commerce
1) A legislative proposal on addressing
unjustified geo-blocking and other
forms of discrimination based on
nationality, place of residence, or place
of establishment within the Single
Market
- To enable customers from the Member
States to buy under the same conditions
as local customers
- This geo-blocking initiative covers
services included within the scope of the
Services Directive and the e-Commerce
Directive, such as:
o online and offline retail sales of
goods
o electronically supplied services
o giving access to non-audio-visual
digital content (music, e-books,
software, games)
o tourism services
o entertainment
o business services
o electronically supplied services
(cloud services, data warehousing,
website hosting, remote system
administration, installation of filters,
firewalls, banner-blockers) >
delayed application to allow service
providers to prepare for the changes
o services used or consumed by the
customer outside his own Member
State (eg concert tickets, rental of
accommodation)
2) A legislative proposal proposing
measures in the area of parcel delivery
- Significant variations in prices for parcel
delivery are sometimes without obvious
explanatory cost factors.
- Thus, there must be enhanced
transparency in tariffs and terminal rates
for cross-border parcel delivery services.
- Competition should also be encouraged
by requiring transparent and non-
discriminatory third party access to
cross-border parcel delivery services
and/or infrastructure of universal service
providers.
3) A legislative proposal revising the
Regulation on Consumer Protection
Cooperation

- Adopted in 2004 but a high level of non-
compliance with key consumer rules
persists in the main online consumer
markets
- 37% of e-commerce or booking websites
do not respect basic consumer rights
- Proposed new CPC Regulation will thus:
o Provide a strengthened and more
efficient enforcement cooperation
framework that will increase legal
certainty, especially for traders and
consumers active across borders
o Enable authorities, by means of
additional powers, jointly to act
faster to stop widespread online
infringements > eg interim measures
to block infringing websites
o Provide a single procedure,
coordinated by the Commission,
when the problems are of a Union
dimension > One stop shop
approach
4) Guidance on the implementation and
application of the Directive on Unfair
Commercial Practices (UCPD)
- UCPD is key legal basis to ensure: (1)
that consumers are not misled or
exposed to aggressive marketing, and
(2) that commercial claims made by
traders targeting consumers in the EU
are clear, accurate, and substantiated
- It clarifies that any platform that qualifies
as a “trader” and engages in B2C
activities directly connected with the
promotion, sale, or supply of goods,
services, or digital content to
consumers, must ensure that its own
commercial practices fully comply with
the UCPD.
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applies where such third party
suppliers are traders
3. designing their web-structure in a
way that enables third party traders
to present information to users in
compliance with EU consumer and
marketing law
- It clarifies that online platforms acting
as a trader and engaging in B2C
commercial practices can be found in
breach of EU consumer and marketing
law if they fail to comply with the
professional diligence requirements and
consumers have been or are likely to be
misled.
They cannot invoke the intermediary
liability exemption under the e-
Commerce Directive.
- It considers the self-regulatory principles
on Comparison Tools endorsed by the
multi-stakeholder group. They
committed to be transparent on their
business models and to adequately
disclose their commercial ties with
traders whose products are compared
through their platforms.
- It refers to the “Compliance Criteria” on
Environmental Claims agreed upon by
the Multi-stakeholder Group to enforce
the UCPD against misleading and
unfounded environmental claims.
- It clarifies the interplay between the
UCPD and sector-specific pieces of EU
law.
 Conditions for E-Commerce to Thrive

- It clarifies the interplay between the
UCPD and the e-Commerce Directive.
Online platforms are under
professional diligence duty to take
appropriate measures which (without
amounting to a general obligation to
monitor or carry-out fact-finding) enable
third party traders to comply with EU
consumer and marketing law, and which
help users to understand with whom
they are concluding contracts.
The measures could imply:
1. enabling third party traders to
indicate to users that they are
traders
2. indicating to consumers that EU
consumer and marketing law only
1) Giving consumers and businesses (start-
ups and SMEs) better access to goods and
services offered online across Europe
a
How:
a. Ban unjustified geo-blocking
- To make offers of traders in other
countries more visible, increase the
range of products to choose from, and
increase the possibility to look for the
best offer when purchasing services and
goods online
- To provide the opportunity for customers
and businesses to benefit from greater
choice
b. Lower cross-border delivery prices
- To ease the burden for traders to deliver
goods outside their current reach

- It is not to require the trader to deliver
outside of current reach but to provide
the same delivery options offered to
local customers (eg deliver to address
within the country; pickup at a collection
point)
c. Equal and stronger enforcement of
rules across the EU
- To ensure effectivity of geo-blocking
proposal
- To render automatically void
agreements with traders containing
passive sales restrictions (obligations
not to respond to unsolicited requests
from individual customers)
2) Building trust for consumers and providing
greater certainty for businesses with clear,
less fragmented rules for online sales of
goods and supply of digital content
How:
a. Lower cross-border delivery prices
b. Equal and stronger enforcement of rules
across the EU
c. Facilitate payment methods
- Trust also crucially depends on payment
methods
- Traders will not be forced to accept any
specific means of payment BUT they
should also not refuse payments for
reasons related to nationality, place of
residence, or place of establishment
- THUS traders are not allowed to reject
payment instruments (eg credit or debit
cards) issued in another country if they
accept the same type of payment
instruments to customers in their country
d. Common contract rules
- To address uncertainty about
contractual rights which lead to lack of
confidence from consumers and of trust
in shopping online across borders
- To provide a fully harmonised clear set
of mandatory rights throughout the EU
e. Guidance on Unfair Commercial
Practices Directive
- Guidance has been expanded to cover:
o the interplay between the UCPD and
other EU legislation;
o the growing case-law of both the
Court of Justice and national courts;
and
o the application of the transparency
requirements of the Directive to new
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business models, especially in the
digital sector
3) Reducing transaction costs and
administrative burden for businesses when
trading online across borders
How:
a. Reduce VAT burden
- To extend the current Mini One Stop
Shop to tangible goods sold online >
enables businesses to make a single
declaration and VAT payment in their
own Member State
- Current rule is “place of supply” where
VAT on telecommunications,
broadcasting, and electronic services is
levied where the customer is located.
b. Reduce costs of fragmented contract rules
c. Lower cross-border delivery prices
 Effective Cross-Border Contract Rules for
Consumers and Businesses
o How the proposed (i) Directive on certain
aspects concerning contracts for the supply of
digital content, (ii) Directive on certain aspects
concerning contracts for the online and other
distance sales of goods, and (iii) Regulation on
cross-border portability of online content
services, will support e-commerce:
(i) It will reduce costs resulting from
differences in contract law > It ensures
that key consumer contract law rules on
faulty goods and digital content will be the
same in all Member States.
(ii) It creates legal certainty for businesses >
It will enable businesses to supply digital
content or sell good online based on the
same set of consumer contract rules.
(iii) It helps consumers to gain from online
cross-border shopping in the EU >
Consumers will have a fully harmonised
clear set of rights and will therefore be
more confident in buying goods cross-
border.
(iv) It reduces the detriment suffered by
consumers with respect to defective digital
content > Consumers will have clear and
digital-specific rights, enabling them to
seek remedies.
 E-Commerce Transactions (Laura Edgar)
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VIII.Digital Contracts for Europe – Unleashing
the Potential of e-Commerce

 From the European Commission to the

European Parliament, European Council, and
European Economic and Social Committee
 Dated 9 December 2015

 Context
o Differences in contract law between Member
States are among the barriers to cross-border
e-commerce
o THUS, the Digital Single Market Strategy
announced proposals for simple and effective
cross-border contract rules for consumers and
businesses > by harmonising contract rules for
the supply of digital content and the online
sales of goods

 Features
o They address real-life problems as identified
by stakeholders.
o They take into account the lessons learnt from
previous efforts to approximate contract laws.
They adopted a problem-focused, targeted
approach; they focus on a full harmonisation
of mandatory consumer rights. As Directives,
they leave Member States the freedom to
adapt the implementation to their national law.
o They strike an appropriate balance between a
high level of consumer protection at the EU
level and significantly increased opportunities
for businesses through full harmonisation.