US companies with Fangs: Facebook, Amazon, Netflix and Google
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Companies from Google and Netflix to the UK’s Royal Mail were focused on Brussels on Wednesday when the European Commission launched sweeping rules for cross-border digital trade, covering everything from online shopping to streaming services and even parcel delivery.

What was proposed?

Brussels has been working on a “digital single market” for about 18 months. The idea is simple: there is a single market for goods bought and sold in the real world, so there should be a single market online, too.

The reality is more complex, with the commission trying to hack through the thicket of rules when it comes to cross-border trade online. On Wednesday, it proposed four measures aimed at making the single market work online.

What received the most attention?

The most eye-catching rules mandated companies such as Netflix to dedicate at least 20 per cent of their catalogues to European content, as part of an overhaul of the EU’s rules on “audiovisual content”.

While streaming services face tighter rules, rival traditional broadcasters will be given the go-ahead to show more adverts during primetime.

Broadcasters are limited to 12 minutes of advertising per hour. But this would change to a system allowing TV channels to show more adverts during peak hours, as long as they do not account for more than 20 per cent of viewing between 7am and 11pm each day.

What sneaked under the radar?

Brussels wants Google et al to take more responsibility for the content they show. Companies such as Google benefit from safe haven status, meaning they are not liable for issues such as copyright infringement, providing they take offending content down when alerted to it.

Instead, the commission wants them to be more proactive when it comes to searching for breaches such as illegal hate speech and copyright abuse.

This is a significant — and controversial — step: the emergence of companies such as Facebook as both a canvas for other people’s content and a publisher in their own right has created a regulatory conundrum that officials are still trying to solve.

Not all are happy with this compromise. Marietje Schaake, a Dutch MEP, said: “The commission is trying to reconcile water with fire. There can be no room for privatised law enforcement in the EU.”

What other measures are on the cards?

Less glamorous but still significant was an overhaul of parcel delivery rules in the EU. Brussels wants more transparency over pricing in the hope this will lead to lower costs for consumers and retailers. There are huge discrepancies in how much it costs to send packages abroad; on average it costs five times more.

The message from the commission to the likes of Royal Mail is simple: bring prices down or we will do it via regulation. In general, industry has been peeved by this prospect. “The commission is introducing price regulation through the back door,” one lobbyist said.

What else has irked industry?

Rules forbidding websites from discriminating against users from other countries. About one in three consumers is unable to buy stuff online from other countries, according to the commission.

Defending the proposal, the EU’s digital chief Andrus Ansip said: “Is this really a single market we have, when one-third who wanted to buy goods or services from another member state were unable to do that?” Critics say it is predominantly a bugbear for the relatively small number of expat workers — of which the commission has more than a few.

So who supports these proposals?

When it comes to digital issues, member states are divided. There are two blocs. On one side is a camp broadly in favour of the commission’s work that includes Britain and Ireland, Poland, and the Nordic and Benelux countries. This week, 23 ministers from 14 countries signed a letter supporting Brussels’ efforts.

But they face two formidable opponents who are less than happy: France and Germany. Berlin has been among the most ardent supporters of stricter regulation for big tech companies such as Google, and is wary of further liberalisation of online trade.

Paris is deeply sceptical of anything that may water down its protection of French cultural works. This disagreement will play out in the European Parliament with roughly the same teams.

When it comes to making these proposals law, the fight has just begun.

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