Förderverein Informationstechnik und Gesellschaft

LAB on Electronic Commerce - Commission Proposal for a Dir

European Commission Legal Advisory Board

Minutes of the meeting of the Legal Advisory Board held in Brussels on 25 November 1998


3. Electronic Commerce - Commission Proposal for a Directive

Mrs Froehlinger gave a very interesting an in depth presentation on the draft Directive on Electronic Commerce issued recently. Her intervention consisted of two parts: a general introduction and a specific part, dealing with the 5 areas contained in the draft.

a. General remarks

Mrs Froehlinger stated that Electronic Commerce offers the Community a unique opportunity for economic growth, to improve European industry's competitiveness and to stimulate investment in innovation and the creation of new jobs. However, these will not be optimised unless the many legal obstacles, which remain to the on-line provision of services are eliminated. Therefore, the proposal intends to remove such obstacles thereby allowing free circulation of Electronic Commerce in Europe. She stressed that the proposal meets the principles of subsidiarity and proportionality by covering only those issues where a Community initiative is indispensable. Mrs Froehlinger added that, at present, there is uncertainty in a number of areas about how existing legislation can be applied to the on-line provision of services. There is divergent national legislation already in place or currently being discussed. Furthermore, diverging jurisprudence is emerging. The proposal, therefore, seeks to remove the obstacles that result from such conditions, for service providers established in Europe, by tackling a number of key issues that together form a coherent framework to bring about the free circulation of on-line services. In other areas, Mrs Froehlinger said, one will have to live with divergence and rely on other instruments, such as mutual recognition.

b. Specific areas

Going into more detail, Mrs Froehlinger touched upon five areas, specifically dealt with in the draft.

Establishment of Information Society service providers

The proposal aims to remove the current legal uncertainty surrounding this issue, by providing a definition of the place of establishment. Mrs Froehlinger stressed that this is a key element for the proper functioning of the Single Market. In addition, she explained that the proposal prohibits special authorisation schemes for information society services and sets out some information requirements that the provider must fulfil in order to ensure transparency of its activities.

Commercial communications

Subsequently, Mrs Froehlinger touched upon commercial communications. The proposal defines what constitutes a commercial communication and makes it subject to certain transparency requirements to ensure consumer confidence and fair trading. In order to allow consumers to react more readily to harmful intrusion, the proposal requires that commercial communications by e-mail are clearly identifiable. In addition, for regulated professions (such as lawyers or accountants), the proposal lays down the general principle that commercial communications are permitted, provided they respect certain rules of professional ethics which should be reflected in codes of conduct to be drawn up by associations representing such professions.

On-line conclusion of contracts

Mrs Froehlinger stressed that the Commission feels that Electronic Commerce will not fully develop if concluding on-line contracts is hampered by certain form and other requirements, which are not adapted to the on-line environment. To this end, Member States shall be held to adjust their national legislation, in the sense that they are under an obligation of result that on-line contracts can be concluded validly. In addition, the proposal removes legal insecurity by clarifying in certain cases the moment of conclusion of the contract, whilst fully respecting contractual freedom.

Liability of intermediaries

Furthermore, Mrs Froehlinger provided details on liability of intermediaries. To facilitate the flow of electronic commerce activities, there is a need to clarify the responsibility of on-line service providers for transmitting and storing third party information. To eliminate the existing legal uncertainty and to bring coherence to the different approaches that are emerging at Member State level, the proposal establishes a mere conduit exemption and limits service provider's liability for other intermediary activities. Mrs Froehlinger added that a careful balance is sought between the different interests involved in order to stimulate co-operation between different parties thereby reducing the risk of illegal activity on-line.


Finally, in the area of implementation, Mrs Froehlinger stressed that the Commission has sought to ensure that existing EC and national legislation is effectively enforced. By strengthening enforcement mechanisms, the development of the Internal is stimulated. This is achieved by encouraging the development of codes of conduct at Community level, by stimulating administrative co-operation between Member States and by facilitating the setting up of effective cross-border alternative dispute resolution systems. For similar reasons the proposal also requires Member States to provide for fast, efficient legal redress appropriate to the on-line environment.

Thanking Mrs Froehlinger for her highly interesting contribution, the Chairman gave the floor to Mr Roberts from DG XXIV, enabling him to provide information on the Council Recommendation on Consumer Dimension of the Information Society.