During the last year, there has been much talk among the great and good in Brussels of implementing a unified policy on e-commerce. This was reiterated by the Heads of State at the recent European Council Summit in Portugal when the E-commerce Action Plan was adopted.
However, there are significant differences between what is stated as being high level EU e-commerce policy and what is happening in practice. There have been several pieces of legislation on e-commerce, most notably the flagship E-commerce Directive which aims to set a framework for the EU internal market in e-commerce. While not perfect, this is generally a good piece of legislation which irons out some of the major difficulties of business to consumer e-commerce transactions.
However, the E-commerce Directive is contradicted and undermined by proposed new legislation on jurisdiction and non-contractual liability in the so-called Brussels and Rome II Regulations. The E-commerce Directive is also contradicted by certain provisions of the draft Data Protection and Telecoms Directive which is about to be adopted as part of a large package of telecoms legislation which includes directives on unbundling the local loop and broadband internet access.
The only thing that is clear from present EU policy is that there is no unified joined-up thinking in the EU institutions. Rather, there are a number of different and often contradictory pieces of legislation being adopted. Much of this legislation will significantly add to the costs of doing e-business in Europe and has not been properly thought through. This can largely be attributed to the EU’s habit of relying on academic studies which then become the basis for policy, rather than talking to business and other interested parties before proposing legislation. It is also interesting to note that in a recent European Commission Consultation, the majority of European industry stated that they could not live with a proposed measure on jurisdiction. However, the commission chose to give equal weight to contrary opinions expressed by academics.
The EU is in danger of passing too much legislation and setting up a regulatory framework which is full of contradictions and will seriously hamper the development of e-commerce in Europe.
The way to avoid this is for both the EU and national governments to consult with businesses and other interested parties much earlier in the legislative process – rather than saying this is a proposal for legislation that we would like you to comment on, the consultation should be: “Should we make a proposal for legislation?”
The blame for this cannot be placed solely at the door of the European Commission. The member states also have much to answer for. At a meeting held earlier in the year in Ottawa to discuss e-commerce elements of a draft global convention on jurisdiction, the US delegation took along a number of representatives from industry to ensure that any proposals would work in the real world. On the other hand, the EU delegations were limited to civil servants and there was no consultation either at national level, for example through the Lord Chancellor’s Department in the UK, or at European level on the possible impact of this convention.
Other problems arise with the perception of Brussels’ civil servants. While each directorate general of the commission has its own mandate to fulfil, civil servants are supposed to be neutral in their dealings with all interest groups. However, when it comes to issues such as consumer protection, one sometimes gets the impression that certain civil servants are activists in bureaucrats’ clothing. There seems to be a very strong anti-industry bias in many areas of the commission.
The way forward is for lawyers in private practice to become more involved in the European policy-making framework at an earlier stage. This way, much legislation which is contradictory or which will not work in practice, can be challenged way before it gets anywhere near the statute books. The way forward for European lawyers in future is to be proactive rather than reactive.
Mike Pullen is a partner in DLA’s Brussels office.