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March 26, 2015

EU to investigate claims of e-commerce geo-blocking

EU antitrust regulators will look at claims that some retailers are preventing European shoppers buying goods from foreign websites.

By CBR Staff Writer

Online retailers are about to face an industry-wide probe from European Union (EU) antitrust regulators, who have accused some retailers of taking steps to prevent European shoppers from buying goods from foreign websites.

The European Commissioner in charge of competition policy, Margrethe Vestager, announced today at a conference in Berlin a forthcoming proposal to launch a competition inquiry in the e-commerce sector.

More and more goods and services are traded over the internet in Europe. At the same time, cross-border online sales within the EU are only growing slowly. This is partly due to language barriers, consumer preferences and differences in legislation across Member States.

However, there are also indications that some companies may be taking measures to restrict cross-border e-commerce.

In 2014 nearly half of European consumers made purchases online, but only 15% bought goods and services were availed from a seller based in another EU member state.

The commission hints that there some may be practicing geo-blocking, where customers can be stopped on the basis of their card details or residence details.

The year long investigation is expected to end by mid-2016, and the competition probe is part of a wider effort to boost Europe’s digital economy.

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Vestager said: "It is high time to remove remaining barriers to e-commerce, which is a vital part of a true Digital Single Market in Europe.

"The envisaged sector inquiry will help the Commission to understand and tackle barriers to e-commerce to the benefit of European citizens and business."

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