Widespread geo-blocking could breach EU antitrust rules

The European Commission has published its initial findings from research conducted as part of an ongoing antitrust sector inquiry launched last year into the e-commerce sector.

A survey of more than 1,400 retailers and digital content providers found 38 per cent of those selling consumer goods and 68 per cent of digital content providers geo-block customers from other EU countries.

Margrethe Vestager, commissioner in charge of competition policy (pictured), said: “The information gathered as part of our e-commerce sector inquiry confirms the indications that made us launch the inquiry: Not only does geo-blocking frequently prevent European consumers from buying goods and digital content online from another EU country, but some of that geo-blocking is the result of restrictions in agreements between suppliers and distributors.

“Where a non-dominant company decides unilaterally not to sell abroad, that is not an issue for competition law. But where geo-blocking occurs due to agreements, we need to take a close look whether there is anti-competitive behaviour, which can be addressed by EU competition tools.”

The Commission said geo-blocking linked to agreements between suppliers and distributors may restrict competition in the Single Market in breach of EU antitrust rules. However, this needs to be assessed on a case-by-case basis.

By contrast, unilateral business decisions by a non-dominant company not to sell abroad fall outside the scope of EU competition law.

A more detailed analysis of the inquiry’s findings will be presented in a Preliminary Report due to be published for public consultation in mid-2016. It will not only cover geo-blocking but also any other potential competition concerns affecting European e-commerce markets.

The Final Report is scheduled for the first quarter of 2017.

The initial findings on geo-blocking do not prejudge the finding of any anticompetitive concerns or the opening of any antitrust cases.