The death of EU ecommerce: MEPs slam e-tail regulation

NEWS The Brussels Regulation, which was passed by the Council yesterday, brings into force the so-called country of destination principle, under which consumers can sue an e-tailer under the laws of the country in which they live. It is designed to protect consumers who may be reluctant to make purchases from other EU countries if it means giving up the legal protection they receive in their home nation. For example, the regulation allows a German consumer making a purchase from a UK site to sue under German law. Consumer rights advocates say such reassurance is essential for the uptake of ecommerce. But opponents argue it will be disastrous for ecommerce in Europe, forcing small businesses to sell only to consumers in their own nation if they want to avoid the cost of knowing what is legal and what is not in different countries. British MEP Theresa Villiers called the regulation a "killing blow". She and Spanish MEP, Ana Palacio, had argued for the EU to adopt the country of origin principle, where suppliers can be sued only in the country where the company is registered. The Brussels Regulation is in direct conflict with the European Ecommerce Directive passed in May, which establishes the country of origin principle for online traders. The directive establishes alternative dispute resolution measures to protect consumers. Brussels-based lawyer Mike Pullen, of law firm DLA, said the conflicting laws will cause confusion for businesses across the EU. "The Ecommerce Directive is public law and the Brussels Regulation is private law. Lawyers will be telling their clients that something is legal under private law and illegal under public law," he said. Member states still have a year to incorporate the Ecommerce Directive into their national laws. The Brussels Regulation becomes law immediately.