Germany urged to rethink e-commerce law

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Series Details Vol 7, No.14, 5.4.01, p23
Publication Date 05/04/2001
Content Type

Date: 05/04/01

Commission lawyers have told Germany to re-think a draft e-commerce law they claim will put German firms such as media giant Bertelsmann in a legal straitjacket when they sell goods and services outside their home market.

In an internal memo obtained by European Voice, Commission single market officials say Berlin would inevitably face legal action over the tele-services law, designed to put in place the EU's electronic commerce directive.

Their concerns centre on part of the draft rules which will leave German judges to decide whether the country's firms should abide by local or foreign laws in cross-border disputes, depending on which laws are deemed "least restrictive" in the circumstances.

But Commission experts say this requirement in article 4 of the draft law would go against the e-commerce directive; this enshrines the EU's single market doctrine into the online world.

In practice, this means firms are normally given an automatic clean bill of legal health in any member state provided they meet regulations in their own country.

"This method of transposition gives rise to considerable legal uncertainty for German companies, additional legal costs and therefore competitive disadvantages," the memo says.

These could include cases of misleading or inadmissible advertising, unfair competition, product liability and violations of freedom of expression.

The officials conclude that the German law is "clearly incompatible" with the e-commerce directive it is intended to implement.

"This would further increase the legal uncertainty for German customers and German consumers."

Under special single market rules on transparency, member states such as Germany have to notify the Commission before they approve laws which affect the information society sector.

Other member states can also make comments on the laws .

If at the end of that time Commission watchdogs say they have reservations, governments are told to change the law or risk a legal challenge in the European Courts.

Commission lawyers have told Germany to re-think a draft e-commerce law they claim will put German firms such as media giant Bertelsmann in a legal straitjacket when they sell goods and services outside their home market.

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