New row over online shoppers’ legal rights

Date: 23/11/00

By Peter Chapman

A GROUP of member states are demanding last-minute changes to proposals for new rules to govern shoppers' legal rights which industry groups claim will deal a serious blow to e-commerce in the Union.

The call from the UK, Germany, Spain, Luxembourg and Ireland comes as the French presidency prepares to try to broker a deal next week on draft legislation which would allow EU shoppers to take legal disputes over goods bought in another member state to a court in their home country.

The proposals drawn up by Justice and Home Affairs Commissioner Antonio Vitorino are designed to update and incorporate into Union law an existing legal treaty known as the Brussels Convention, and are seen by consumer groups as vital to protect shoppers' rights.

But the dissenting member states, acting on fears voiced by industry groups, are warning that the planned rules could wreak havoc on the fledgling e-commerce market if they are applied in the same way to purchases made over the Internet.

The key problem, say diplomats, is that online businesses could become entangled in legal disputes with web-surfing shoppers in foreign courts, even if they did not specifically seek out those customers.

Companies are calling for the consumer's right to take legal action at home to be removed for all e-commerce sales. But sources say those member states which are opposed to the measure as it stands want it amended so that a customer's right to sue in courts at home would only apply if he or she had been specifically targeted by a foreign firm.

The Confederation of British Industry warns that unless the proposals are changed, many e-retailers, particularly small and medium-sized enterprises, will refuse to offer their wares to purchasers in other member states. The group's legal director Rod Armitage claims that consumers would lose out on the massive potential choice offered by the Internet.

Industry lawyers say they would view adoption of the proposals in their current form as proof that policy-makers are ignoring their views altogether.

An earlier draft of the plan, approved in principle by EU justice ministers last year, came under such fierce attack from industry that a fresh round of consultation was launched. That eventually led to a heated public hearing in Brussels which was attended by more than 500 industry executives and legal advisors.

The European Parliament also weighed in, giving its opinion on the proposals last month. British Liberal MEP Diana Wallis, who was responsible for drafting a report on the issue, said more effort should be made to settle disagreements using out-of-court 'alternative dispute resolution' (ADR) schemes.

European Commission lawyers argued that such a move would be legally unenforceable, but UK diplomats say they still want some reference to ADR to be inserted into the proposals.

A group of Member States are demanding last-minute changes to proposals for new rules to govern shoppers' legal rights which industry groups claim will deal a serious blow to e-commerce in the Union.