E-Commerce Directive 

The European Commission initiated the E-Commerce Directive following its view that electronic commerce should be facilitated to the greatest extent possible, in order to promote employment, economic growth, and investment in the EU. Although e-commerce in the EU is set to account for 340 billion Euro in on-line transactions by 2003, Europeans are regarded as lagging behind their counterparts in the US and other jurisdictions in terms of doing business on the internet.

The Directive applies to both businesses and consumers, and is intended to set down a coherent structure of rules to be observed by entities doing various kinds of online business to ensure a high level of consumer protection.

 

The most contentious issue regards the liability of online service providers . The Directive establishes an exemption from liability for intermediaries where they play a passive role as a "mere conduit" of information from third parties and limits service providers' liability for other "intermediary" activities such as the storage of information.

The Directive also clarifies that the internal market principle of mutual recognition of national laws and the principle of the country of origin must be applied to information society services.

Other central issues:

•  
• Place of establishment : The Directive defines the place of establishment as the place where an operator actually pursues an economic activity through a fixed establishment, irrespective of where web sites or servers are situated or where the operator may have a mailbox.
• Transparency : The Directive requires Member States to oblige information society service providers to make available to customers and competent authorities (in an easily accessible and permanent form) basic information about their activities (name, address, e-mail address, etc).
• Online contracts : The Directive requires Member States to remove any prohibitions or restrictions on the use of electronic contracts. In addition, it ensures legal security by imposing certain information requirements for the conclusion of electronic contracts in particular in order to help consumers avoid technical errors.
• Commercial communications : The Directive defines commercial communications (such as advertising and direct marketing) and subjects them to transparency requirements.
• Implementation . The Directive strengthens mechanisms ensuring that existing EU and national legislation is enforced. This includes encouraging the development of codes of conduct at EU level, stimulating administrative co-operation between Member States and facilitating the setting up of effective, alternative cross-border online dispute settlement systems.

The Electronic Commerce Directive was approved in second reading by the European Parliament on 4 May 2000. The E-Commerce Directive was adopted by the Council on 8 June 2000 and published in the Official Journal on 17 July 2000.

 

The Union of Industrial and Employers' Confederations of Europe (UNICE) believes that the global nature of the information society cannot be over-emphasised and therefore sees worldwide cooperation as absolutely crucial to the development of the information society. Consequently, while it acknowledged the need to consider the functioning of the internal market, it urged the Commission to take an international perspective and to cooperate closely with the EU's main trading pa rtners. In conclusion, UNICE states that the Commission's proposal is a commendable step towards setting up a framework for electronic commerce but that the current proposal falls short on some important issues.