How often do you shop online from another country? How come so few traders sell their goods abroad? Cross-border sales, whether online or offline, are doing very poorly and the main cause for this is the lack of confidence on both the consumer and the seller sides.
Capitalising on the fastest growing retail market: e-commerce
When it comes to online shopping, it is almost a cliché that e-commerce is the fastest growing retail market in Europe and North America. Online sales in Europe are expected to grow by 16.7% in 2016 compared to last year.
The sale of goods is only one of many areas that are increasingly becoming more digital. And that is a trend all of us have to acknowledge - consumers and sellers, but also we, as policymakers, when we are to establish new rules.
Against this backdrop, the European Commission made the creation of a Digital Single Market one of its top priorities for the 2014-2019 period.
The Digital Single Market: a wealth of opportunities
The Digital Single Market can create a wealth of opportunities for start-ups and allow existing companies to access a market of over 500 million people. Completing the Digital Single Market could contribute €415 billion per year to Europe's economy, create numerous jobs and transform our public services.
In theory, at least. We should bear in mind, however, that there are still many hurdles on the way to this ideal of a unified Digital Single Market.
Winning trust: The potential for growth
One of the main difficulties to tackle is the reluctance of both consumers and traders to buy and sell abroad. Language is of course an obstacle, but not the only one.
The lack of trust due to legal differences when it comes to consumer sales law is another one, and the subject of the work I have been carrying out over the past weeks and months. Buyers wonder for instance whether they will be entitled to the same guarantees when buying a product abroad, or what their remedies are when confronted with a faulty product.
Retailers, on the other hand, struggle with 28 (soon 27) different sets of national consumer contract law they would have to comply with when selling abroad. Consumer sales law in Europe varies way too much.
The European directive on the online sales of goods is a good attempt to alleviate some of these concerns, as it proposes to harmonise the main consumer sales rules for the whole of the EU. However, we need to be more forward thinking and take the Commission proposal one step further: only a unified set of rules for both online and offline sales will really make things easier.
Harmonising rights for online and offline sales
At the end of the day it should not make any difference whether you buy your jeans online or in a regular shop: the rights and obligations of the consumer and seller ought to be the same. Our goal should be for consumers to shop online with the same ease and trust as they shop in the High Street and to help businesses to expand their (online) sales, by encouraging, especially the smaller shops, to sell their products abroad.
At the moment only 15% of European consumers buys goods online from other countries and only 12% of European businesses sells online to consumers abroad. If we look at SMEs, the numbers are even lower: only 7% of SMEs sell across borders.
The potential for growth is therefore enormous, provided we go about it in a smart way: tearing down legal barriers, while at the same time guaranteeing a high level of protection for consumers and a level playing field for businesses.
Can it be achieved? Yes, if we lawmakers do it right. This means establishing rules that are practicable, balanced and unified all over Europe, thereby unleashing the full potential of the (Digital) Single Market.
In order to eliminate the existing legal obstacles to cross-border e-commerce, the European Commission released on 9 December 2015 its proposal for a Directive on certain aspects concerning contracts for the online and other distance sales of goods. The proposal focuses on the full harmonization of the rules on online sales and creating a coherent legal framework.
Pascal Arimont is Rapporteur (Parliament's lead negotiator) on the Directive on contracts for online and other distance sales.