Commission proposes legal framework on electronic commerce
The European Commission has recently adopted a proposal for a Directive which would establish a coherent legal framework for the development of electronic commerce within the EU. The proposed Directive, which was foreseen in the Commission's 1997 communication on electronic commerce, covers all Information Society services, defined as those provided normally against remuneration, at a distance, by electronic means, and in response to the individual request of a customer. Services covered would include both business to business and business to consumer services, including services supplied free of charge to the recipient. Examples of sectors and activities covered include on-line newspapers, databases, financial services, professional and entertainment services. The proposed legislation would establish specific harmonised rules only in areas strictly necessary to ensure that businesses and citizens could supply and receive Information Society services throughout the EU. The specific areas defined in the legislation would include a definition of the place of establishment, as the place where an operator actually pursues an economic activity through a fixed establishment, irrespective of where Websites or servers are situated. Another important element of the proposal would be the obligation on Member States to adjust their national legislation to remove any prohibitions or restrictions on the use of electronic media for concluding contracts. This would be in order to make it possible for contracts to be concluded on-line, unrestricted by inappropriate rules. The potential liability of intermediaries would also be clarified, with a proposal for the exemption of liability for intermediaries where they play a passive role. In other areas the Directive would build on existing EU and national legislation and ensure that these are effectively enforced. It would seek to encourage the development of codes of conduct at EU level, by stimulating administrative cooperation between Member States and by facilitating the setting up of effective, alternative cross-border dispute settlement systems. The proposal would also require Member States to provide for fast, efficient, legal redress appropriate to the on-line environment and to ensure adequate sanctions for violations of the rules established. Other areas covered by the proposal include the issue of mutual recognition and the possibility of applying restrictions to Information Society services if necessary to protect the public interest.