Hugh Beale: "There may be many reasons why a company may be reluctant to sell online abroad"

At the two-day Conference, experts from around the world analysed issues involving electronic governance, protection of privacy and personal data, intellectual property and electronic commerce, in the context of building a digital single market. Sessions were also devoted to examining the change of communication and organization strategy in political movements and parties, cyberactivism and the new communication and public opinion media.

In December 2015, the European Commission launched a package of measures aimed at building a digital single market. What does this consist of?

The idea is to try and make sure that digital products are available to consumers under the same terms, wherever they may be in Europe, without any discrimination on the grounds of country of origin, and provide the means so that, if a consumer buys a digital product, he can use it without any extra charge anywhere within the European Union (EU). Right now, that's not happening. To give you an idea, the situation has a lot to do with has been happening with the mobile phone companies, an area where at last we are getting to the point where no-one has to pay more for using the mobile phone abroad.

What are the European Commission's proposals on contract law?

There are two proposals: one is related with digital content, and the other with online sales. The former refers to issues such as downloading music from the Internet, for example. In most EU Member States, it is not clear which legislation is applicable in this case. It is not a tangible good – it is not a DVD, for example – and you don't become owner of the music: you can only listen to it. So what kind of contract is it? Nobody is sure how to define it; so a lot of people advocate having a harmonized European directive that protects the consumer's rights in this case.

And what about online sales?

This is more controversial, because it would mean curtailing consumers' rights in some countries where there are already laws in place that regulate this issue, unlike the situation with digital content. For example, if a British consumer buys a product online and the object or device he receives is faulty, he is entitled to an immediate refund. But in Spain, from what I understand, the consumer is only entitled to ask for repair or replacement of the product. So he would first have to wait until he gets the repaired product back and, if it still does not meet the required specifications, only then can he ask to have his money back. With the proposed maximum harmonization of the legislation on online sales, the European consumer would only be entitled to repair or replacement, not to an immediate refund. Furthermore, this would only apply to online sales, which means that retailers would have one law for online sales and another for face-to-face sales. Rather confusing, isn't it? This makes the second proposal more problematic and it seems that the Commission will shelve it, for the time being, and focus on the first proposal, the one about digital content.

Let's look at Amazon, for example: it's an American company but let's say that it is a British company. Which law would be applicable when selling products in Spain?

At present, each country has its own consumer legislation, even though there are certain minimum pan-European standards that everyone must abide by. So each country can give consumers additional rights; this is good for consumers but it may be a problem for retailers.

Why?

Let's assume that the retailer is operating in Spain or that its website targets the Spanish market, like the case of Amazon that you proposed. Spanish consumers buying from this retailer will be protected by Spanish law. Thus, retailers will need to know the laws of each region it sells in and this is complicated and expensive, especially for small and medium-sized companies. Therefore, the idea is to try and harmonize laws to make everything simpler. It's what we call full harmonization or maximum harmonization. The goal is to increase cross-border online commerce.

Why does this problem make many companies afraid to sell outside of their country and many consumers unwilling to buy online abroad?

There may be many reasons why a company may be reluctant to sell online abroad. It may have doubts about how it will be paid, or how it can deliver the product to the customer, because some transport companies apparently charge the earth to deliver abroad. It may also be unsure as to whether it is infringing copyright laws when it is selling outside of its country; for example, if it tries to sell an e-book or a film or music, it may only have permission to sell in certain countries.

Is this what is called geoblocking?

Yes. The Commission now wants to reduce the scope of this phenomenon but there are arguments for saying that a certain degree of geoblocking is necessary, because we do not yet have harmonized intellectual property laws. This is not my field of specialization but yesterday I learned in the Conference just how complicated the law is in this area, and it is still a long way from being uniform all around the EU. So, if there is a different copyright law in each country, geoblocking might be necessary to prevent breaches of intellectual property rights.

Recently, there has been a case called the "police virus", in which several hackers sent emails as if they were from the police, telling people that they had to pay a €100 fine for having visited illegal websites. They stole 1 million euros in 30 different countries. The police forces of each of the countries affected, working with Europol, managed to solve the case. Wouldn't it be easier if we only had a single European law on this issue?

It would be useful to have a European standard for Internet fraud, but because there are so many different types of Internet fraud, this is difficult to do. But we also have to educate the public so that they don't fall so easily for these scams.

As consumers, is there any way we can protect ourselves from Internet fraud?

In my country, the United Kingdom, there are a number of ways. For example, if you pay online with a credit card, you can ask the credit card company to return the money and then it will be the credit card company who has to prosecute the scammer. This is a very good protection; it's a kind of purchase insurance. I have always thought that it would be good to have this measure implemented as a European standard.

Daesh often uses the Internet to spread its message. Do we have a European legislation in place to prohibit this kind of thing or does each country have its own legislation?

I think this is a very complicated issue because of (or thanks to) the freedom of speech. Obviously, we don't want Daesh's videos on the Internet, but it is very hard to define what should be allowed and what should be banned without impinging on the freedom of speech. Most countries have a system to force Internet providers to delete unacceptable content, such as child pornography, for example, and we need cooperation in these issues. However, this kind of content often comes from countries outside of the EU and, therefore, it's hard to control it. I agree that there is a lot of material that should be erased from Internet, but I wouldn't want to create a legislation that could interfere with freedom of speech or impose too many restrictions.

I'm talking about European regulations with a British person. However, with the Brexit, perhaps in the not too distant future you won't have to worry about these things any more...

I am very annoyed and ashamed about what my country has done. I think that those who led the Leave campaign thought that they could get their way. In other words, they thought that they could ignore the regulations on the free movement of people within Member States while at the same time remaining within the European Economic Area (EEA). But if you belong to the EEA, you have to accept the free movement of people. Why should the EU make an exception on this for the United Kingdom? If they did, they would have to do the same for any other country that asked for it.