Geo-Blocking – stay compliant when selling into the EU

20 November, 2018

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New rules prohibiting “geo-blocking” apply from 3 December and most businesses selling into Europe will need to comply. 

What is geo-blocking?

Geo-blocking is the practice of applying different terms to sales of goods or provision of services depending on where the customer is based.  The prohibition includes denying access to your website to potential customers based in different Member States, as well as re-directing customers from one Member State to a different website in another Member State.  It also covers preventing purchases being made by credit cards from particular Member States.   The new law is aimed at ensuring customers get access to the same prices, offers and terms, regardless of where they live or are based.

The scope of the restrictions

The rules apply to traders selling to consumers or to other businesses.

Don’t rely on Brexit – even if we do have a “hard “Brexit where we leave the EU without an agreement on trade next March, the new rules apply to non-EU traders selling into the EU as well, so UK businesses will still need to comply.

Note however this doesn’t mean you are obliged to sell into all Member States or to deliver cross-border and you are also still in fact permitted to apply differential pricing and indeed offer different general terms and conditions in different Member States or within a Member State.  There is no obligation to harmonise prices or terms.  However, all customers regardless of location must be able to access and take advantage of those different prices or terms.

Also, if discrimination in your terms of sale or supply can be justified (for example if it is required by local laws) then it won’t be illegal.

The new rules don’t currently apply to copyright protected works, such as music, software or electronic games, but this will be reviewed in two years time.

Certain sectors are not covered by the rules, such as financial services and healthcare.  But the exemptions are limited and in most cases are covered by other rules which have a similar effect.

Next steps

Traders whose operations fall within scope should be looking at the terms they apply to their website (and app) orders and sales process to ensure they do not discriminate based on the customer’s nationality, place of residence or place of establishment.  Delivery and logistics arrangements should also be checked to ensure customers are not offered a different deal if they are based in a different Member State.

For more information on geo-blocking or any aspect of on or offline trading, please contact Elliot Fry at elliot.fry@crippspg.co.uk or on +44 (0)1732 224 034 

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