Annexes to COM(2020)766 - First short-term review of the Geo-blocking Regulation

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This page contains a limited version of this dossier in the EU Monitor.

dossier COM(2020)766 - First short-term review of the Geo-blocking Regulation.
document COM(2020)766 EN
date November 30, 2020
agreements.

Other sectors

The Commission has examined other sectors not covered by the Regulation, with a view to assessing possible unjustified restrictions (applied by traders) which could be tackled through the Regulation.

On transport, the non-discrimination principle is already embedded in existing sector-specific EU legislation, or the passenger rights legislation currently being negotiated for railways. Results from the 2019 mystery-shopping survey suggest that geo-blocking practices in different transport sectors (airlines, bus, train and maritime) are mostly rare, although they are slightly more prevalent in the rail and maritime sectors 64 . This suggests there is a need to ensure that the non-discrimination clause proposed in the recast Rail Passenger Rights Regulation is quickly approved by the co-legislators. More broadly however, there does not appear to be a need to include transport services in the Regulation at this stage. This is because of: (i) the overall rarity of geo-blocking in the transport sector; (ii) the existence of specific non-discrimination clauses in other sectoral transport instruments (air, maritime, bus and coach); (iii) an upcoming legislative initiative for railways and (iv) the possible impact of public service obligations applied in the Member States.

Financial services, telecoms, and health services all present specific features that must be taken into account when considering how to tackle possible unjustified barriers to cross-border access of these services 65 . For example cross-border provision may trigger sector specific supervisory requirements or may be subject to some safeguards and additional checks that are required or allowed by sector-specific legislation, so that a blanket extension of a horizontal instrument such as the Regulation does not appear warranted.

4.Follow-up actions by the Commission

At this stage, the preliminary view of the Commission is that it is too soon to assess all the direct and indirect effects of the implementation of the current Regulation and identify amendments in this regard. Despite the slow implementation, the initial positive effects reported here indicate that there is near-term potential for better results over time, notably through better enforcement in Member States. Moreover, any possible synergies with other measures of the digital single market in enhancing customer access to offers should be monitored in the next 12-18 months.

As far as any extension of the Regulation to electronically supplied services providing access to copyright-protected content is concerned, further assessment and consideration is also needed. The analysis shows that geo-blocking in these sectors is driven by different factors and market dynamics, and that extension of the Regulation might possibly have different effects in different areas. Any beneficial effects, in particular for consumers, largely depend on copyright-licensing practices and approaches, which deserve further analysis. This is particularly the case for the audiovisual sector, where there may indeed be potential relevant improvements in terms of availability of content. This supports the need to look at the issue of consumers’ access to content, in particular audiovisual content, in the broader context of accompanying the industry in its recovery and transformation in the Commission’s future media and audiovisual action plan. The Commission will engage with stakeholders in a dialogue to identify how to foster better circulation of audiovisual content across the EU, while proposing actions to support the industry’s recovery 66 . The Commission will also pursue its efforts to support the sustainability of other sectors, such as the music sector in the framework of the dedicated initiative “Music Moves Europe”, based on an integrated approach of European support to the sector 67 .

In the meantime, eliminating existing barriers and ending discrimination against customers remains a priority of the Commission. The following immediate follow-up actions are proposed.

·Firstly, it is important to ensure that the full potential of the current Regulation is realised. This requires: (i) full implementation by Member States; (ii) greater cooperation among competent authorities and the Commission within the new CPC network; (iii) further guidance on the application of the Regulation and on its relationship with the broader non-discrimination framework of the Services Directive.

·Secondly, there is a need for continued awareness-raising activities among traders and consumers about their obligations and rights. The Commission should be involved in these activities, alongside stakeholders and competent authorities.

·Thirdly, the Commission will continue to monitor market developments on customers’ access to offers in the single market, also in view of the forthcoming implementation of other e-commerce measures of the digital-single-market strategy.

·Finally, the Commission will gather feedback from stakeholders on the conclusions of this first short-term report and the underpinning findings and evidence (including on the availability of copyright-protected content). Stakeholders could also provide relevant feedback on the short- and medium-term effects of the COVID-19 crisis that could not be taken into account in this report.

The Commission will continue to monitor the impact of the regulation on the basis of evidence collected and feedback from stakeholders, as well as implementation of DSM measures, and aims at taking stock before end of 2022 on progress in further reducing cross-border barriers,. It will specifically assess the progress achieved on the availability of audiovisual content following the dialogue with industry. The outcome of this monitoring will determine whether the Commission will then consider proposing amendments to the Regulation or any other follow-up measures, including appropriate legislative intervention.

(1)

Regulation (EU) 302/2018.

(2)

See Art 9(2) of the Regulation.

(3)

Regulation (EU) 2017/2394 of the European Parliament and of the Council of 12 December 2017 on cooperation between national authorities responsible for the enforcement of consumer protection laws and repealing Regulation (EC) No 2006/2004 (Text with EEA relevance) OJ L 345, 27.12.2017, p. 1–26. This new CPC Regulation applies from 17 January 2020.

(4)

At the date of adoption of this report, one Member State has not yet adopted all necessary measures, although it informally cooperates within the CPC network with other enforcement authorities.

(5)

  https://ec.europa.eu/digital-single-market/en/geo-blocking-digital-single-market#Implementation

(6)

From a few hundreds of euro to fines above EUR 100 000 and/or fines linked to turnover. See accompanying SWD, sec. 2.1.2.

(7)

 Available at https://ec.europa.eu/digital-single-market/en/news/geo-blocking-regulation-questions-and-answers .

(8)

Flash Eurobarometer 477b (2019).

(9)

See ECC network position paper, available at https://www.ecc.fi/globalassets/ecc/ajankohtaista/raportit/2019-geoblocking-position-paper-en.pdf , and accompanying SWD, sec. 2.1.3.

(10)

Ipsos et al (2020).

(11)

GfK (2015), available at https://ec.europa.eu/info/sites/info/files/geoblocking-final-report_en.pdf

(12)

SWD sec. 2.2 based on Ipsos et al (2020).

(13)

Although already low generally, Ipsos et al (2020).

(14)

Even when issues were encountered, failure to register dropped significantly (by 13 pp), Ipsos et al (2020).

(15)

SWD sec. 2.3. It is important to note that this overall indicator also includes elements not directly addressed by the Regulation (such as cross-border delivery), which slightly deteriorated, thus negatively affecting the overall success rate.

(16)

Ipsos et al (2020).

(17)

SWD, sec. 2.1.3 and results of the surveys with national bodies reported therein.

(18)

If the trader under his general conditions already provides for cross-border delivery in the country of the customer, on the other hand, there should be no discrimination of that customer.

(19)

Ipsos et al (2020). This is consistent with the general Eurostat figures about the number of enterprises actively engaging in cross-border sales, which remained stable in 2019 compared to 2017. Only a minority of enterprises sell across borders, even in the online sector (43% of companies operating online sell across borders, compared to 9% of all enterprises).

(20)

SWD, sec. 2.2.4.1 and Ipsos et al (2020). This figure of 50% includes also cases where the problems with delivery incurred during registration (delivery address not accepted in the registration phase) were reported.

(21)

These are the second- and third-most prominent obstacles for retailers respectively (after debt recovery) and still affect a large share of businesses (60% of businesses cite VAT procedures as an obstacle to selling across borders), Commission Staff Working Document: Business Journey on the Single Market: Practical Obstacles and Barriers SWD(2020) 54 final.

(22)

In addition to the DSM measures, an overall review of the Vertical Block Exemption Regulation due in 2022 is also ongoing. This review will partly focus on ‘vertical’ contractual obstacles imposed on traders, affecting the cross-border provision of services and goods.

(23)

See Council Directive (EU) 2019/1995 amending Directive 2006/112/EC as regards provisions relating to distance sales of goods and certain domestic supplies of goods, as well as the related Council Implementing Regulation (EU) 2019/2026 amending Implementing Regulation (EU) No 282/2011 as regards supplies of goods or services facilitated by electronic interfaces and the special schemes for taxable persons supplying services to non-taxable persons, making distance sales of goods and certain domestic supplies of goods and Commission Implementing Regulation (EU) 2020/194 laying down details on the working of the VAT One Stop Shop; Directive (EU) 2019/770 of the European Parliament and of the Council of 20 May 2019 on certain aspects concerning contracts for the supply of digital content and digital services and Directive (EU) 2019/771 of the European Parliament and of the Council of 20 May 2019 on certain aspects concerning contracts for the sale of goods, amending Regulation (EU) 2017/2394 and Directive 2009/22/EC, and repealing Directive 1999/44/EC; Directive (EU) 2019/2161 of the European Parliament and of the Council of 27 November 2019 amending Council Directive 93/13/EEC and Directives 98/6/EC, 2005/29/EC and 2011/83/EU of the European Parliament and of the Council as regards the better enforcement and modernisation of Union consumer protection rules; Regulation (EU) 2018/644 of the European Parliament and of the Council of 18 April 2018 on cross-border parcel delivery services.

(24)

Identifying and addressing barriers to the Single Market COM(2020)93 final.

(25)

Earlier Commission guidance on the application of Article 20(2) dates back to 2012 (SWD(2012)146) before the DSM measures and the Regulation.

(26)

Audiovisual services are fully excluded from the scope of the Regulation. Non-audiovisual content services whose main feature is giving access to or use of copyright protected works (such as e-books, online music, software and video games) are subject to the Regulation, except its Article 4.

(27)

Including the Eurobarometer Flash survey (EB477b (2019)), as well as the ‘Study on the impacts of the extension of the scope of the Geo-blocking Regulation to audiovisual and non-audiovisual services giving access to copyright protected content’ prepared by VVA et al. (2020), further input from the JRC and studies carried out by different stakeholders. The specific sources are specified further in the SWD sections referred to.

(28)

Flash Eurobarometer 477b (2019) shows that, on average, 8% of internet users in the EU have tried to access online music services across borders, and 29% of those who have not tried this would be interested to do so.

(29)

SWD sec. 3.1.2.1.

(30)

SWD sec. 3.1.2.2., based on VVA et al (2020), JRC (2017).

(31)

SWD sec. 3.1.2.2., based on VVA et al (2020).

(32)

SWD sec. 3.1.2.4, based on VVA et al (2020), NERA (2019), Waldfogel, 2018.

(33)

SWD sec. 3.1.2.4, based on VVA et al (2020), NERA (2019), Waldfogel, 2018.

(34)

SWD sec. 3.1.2.4, based on the study report “A European music export strategy” (2019)

(35)

Flash EB 477b (2019).

(36)

SWD sec. 3.1.3.2 based on VVA et al (2020).

(37)

SWD sec. 3.1.3.3., based on VVA et al (2020).

(38)

SWD sec. 3.1.3.4., based on VVA et al (2020).

(39)

SWD sec. 3.1.3.4 based on VVA et al (2020).

(40)

Flash EB 477b (2019).

(41)

SWD sec. 3.1.4.1. based on VVA et al (2020).

(42)

SWD sec. 3.1.4.2 based on VVA et al (2020).

(43)

SWD sec. 3.1.4.4 based on VVA et al (2020).

(44)

SWD sec. 3.1.4.4 based on VVA et al (2020).

(45)

SWD sec. 3.1.4.4 based on VVA et al (2020).

(46)

Flash Eurobarometer 477b (2019), compared to 5% and 29% respectively in 2015.

(47)

SWD sec. 3.1.5.2 based on JRC (2020).

(48)

Commission Staff Working Document accompanying the Report from the Commission to the Council and the European Parliament on the E-commerce Sector Inquiry, SWD(2017)154.

(49)

Case AT.40023 – Cross-border access to pay-tv.

(50)

Between 7% and 3%, SWD sec. 3.1.5.2 based on JRC (2020).

(51)

SWD sec. 3.1.5.2 based on JRC (2020).

(52)

Regulation (EU) 2017/1128.

(53)

Member States need to transpose Directive (EU) 2019/789 by 7 June 2021.

(54)

See SWD sec. 3.1.1 and 3.1.5.1.

(55)

See DG COMP sector enquiry (2017) on the scope of licensed rights in AV sector.

(56)

SWD sec. 3.1.5.4 based on VVA et al (2020).

(57)

SWD sec. 3.1.5.4., based on VVA et al (2020) and Oxera (2016).

(58)

Case C-132/19 Groupe Canal + v Commission.

(59)

SWD sec. 3.1.5.4 based on VVA et al (2020).

(60)

SWD sec. 3.1.5.4. and sources reported therein.

(61)

SWD sec. 3.1.5.4, for example O&O (2020) models this effect for a significant range of sport events.

(62)

SWD sec. 3.1.5.4 Hugenholtz-Poort (2019).

(63)

Up to 20% of the paid services in 2023, estimation in VVA et al (2020).

(64)

SWD sec. 3.2., based on Ipsos et al (2020).

(65)

Such as specific rules on non-discrimination for electronic communications services, allowing for fair-use policies of roaming services, EU rules on access to basic payment accounts, or patients’ non-discrimination rights for health services, see SWD sec. 3.2.-3.5.

(66)

For instance for the AV sector the COVID crisis had immediate effects and is likely to have also deferred, more profound effects, as noted by the European Audiovisual Observatory, which started to track supporting measures in this regard, see https://rm.coe.int/the-european-audiovisual-industry-in-the-time-of-covid-19/16809ec9cb. For the immediate effects the Commission intervened with a temporary framework for state aid that has allowed Member States to adopt a number of support measures and sector specific measures in the frame of the Creative Europe programme i.e. flexibility introduced in the MEDIA actions and an adaptation of the cultural and Creative sectors guarantee facility allowing for more flexibility with repayment of loans and encouraging financial institutions to lend more money to cultural and creative sectors. Further, the Commission adopted an unprecedented recovery plan for Europe to repair and prepare for the next generation, recognizing that the cultural and creative industries, including audiovisual and media, form an important industrial ecosystem.

(67)

See the measures referred to in SWD sec. 3.1.2.4, taking into account also the post-COVID-19 landscape.