The European Parliament this week published its latest response to the European Commission’s Digital Single Market initiative, in a draft resolution of the internal market and industry committees. The resolution is supportive of the sharing economy, which the committees say increases competition and consumer choice and helps create a more inclusive job market.
In its press release, the Parliament says that, with this resolution, it has “not only complemented the Commission’s digital single market strategy but has broadened the perspective. We have incorporated crucial aspects of digitization, most importantly how it is reshaping the landscape of labour and social welfare schemes.” The draft resolution, first published on 22 September 2015 (see here) was adopted by the Parliament on 16 December 2015, by a significant majority of 80 votes to 6, with 3 abstentions. There is not yet a published copy of the draft resolution as adopted in December, but a press release has been released (see here).
End ‘discrimination’ on the basis of location
A key focus of the Digital Single Market has been eliminating discrimination between consumers on the basis of their location. This may be an issue for websites that offer different prices, products or services, based on the EU country in which the consumer is based. In the sharing economy, this is often the natural result of the provision of local services and such differentiation of offers will usually be achieved via a geo-block to prevent access, or redirect the consumer.
Discrimination between consumers on the basis of location is already prohibited by the Services Directive. However, the Commission has to date failed to successfully push forward any enforcement cases, which have to be enforced at Member State level. In September 2015, the Parliament called for an “ambitious enforcement framework” for the Services Directive, which would place greater pressure on service providers to ensure they do not discriminate between consumers on the basis of location (for example, by imposing differential pricing between Member States without justification). In particular, the draft resolution called for the Commission to identify and define concise case groups of “justified discrimination” under the Services Directive in order to outlaw unjustified discriminatory behaviour.
This could be lead to greater enforcement if Member States have clearer guidance on where discrimination arises. For sharing economy platforms, this would have a significant impact on the ability to offer different services and/or charge different prices between Member States.
The Parliament does not refer to this proposal in its December press release and we wait with interest to see if it has been adopted in the latest draft resolution.
For more information on how the Commission is tackling geo-blocking, see here.
Platforms and the sharing economy
In the Parliament’s most recent press release, there is a clear focus on the sharing economy. The Parliament is concerned that Member States are pursuing different approaches towards regulating the internet and the sharing economy.
Although it does not make specific proposals, the draft resolution encourages the Commission to analyse the need to protect consumers in the sharing economy and, “where appropriate and if necessary, to come forward with proposals to ensure the adequacy of the consumer-related legislation framework in the digital sphere, including possible abuses”.
More broadly, the Parliament calls on the Commission to check whether potential issues related to online platforms could be resolved by applying existing rules properly and to give clear guidance on how consumer rules apply to traders using these platforms. MEPs also want the Commission to identify and address barriers to platform emergence and scale-up.
Although the draft resolution is supportive of the sharing economy as a driver of innovation and competition, it undoubtedly raises the scope for further enforcement of existing regulation in this market – particularly in respect of consumer protection.
The Commission has already launched a consultation into platforms, specifically seeking the views of stakeholders on the sharing economy and regulation, including whether the Commission should legislate to achieve a level playing field with traditional players (read more here). This latest publication from the Parliament suggests that MEPs want the Commission to consider enforcement of existing regulation, rather than introducing new legislation.
Next steps
The Commission’s platforms consultation closes at the end of the month, while the Parliament’s draft resolution will be tabled for a vote in Strasbourg in January 2016. As the Digital Single Market continues to gather momentum, there is no doubt that the sharing economy will form a key part of whatever comes next from Europe.
This development also highlights the importance of engagement with the EU institutions on the Digital Single Market, with the platforms and geo-blocking consultations still open (respond here ). In particular, if your websites are geo-blocked and/or apply different terms between member states, this offers an opportunity to explain why. Now is a critical time to ensure that the Commission understands any issues affecting your business or the wider sharing economy environment.
We have a hub devoted to the Digital Single Market here.
Contacts: Katherine Kirrage, Yves Stans, Nico Just.
Tags: Digital single market
