In the payment services and e-commerce arena, EU regulators are striving to keep up with the rapid pace at which technology is advancing in order to properly regulate the various technologies currently in use and to ensure that consumers are protected.

One of the main challenges for the payments industry in boosting European cross-border e-commerce is the lack of consistent EU rules for online contracts and consumer protection. This gap in regulation could be what’s keeping EU e-commerce down. According to the European Commission, only 38% of people feel confident buying online from another EU country, and only 7% of European SMEs sell cross-border. The EC says it is aiming to create “clearer rules to sell cross-border and scale-up businesses in a market of more than 500 million consumers.”

To this end, on May 6, 2015, the EC presented its strategy for a digital single market, which outlined the challenges and described a three-year road map for the EU to move towards a single digital economy. The central theme of the digital single market strategy is harmonization– that is, to move from 28 national markets to a single one, which could bring €415 billion per year to the European economy and create hundreds of thousands of new jobs.

Currently, according to the Commission, “only 15% of consumers shop online with a trader based in another EU country as delivery costs prove to be a challenge.” Sixteen targeted initiatives have been outlined in order to create better access for consumers and businesses to digital goods and services across Europe. These initiatives include creating the right conditions and a level playing field for digital networks and innovative services to flourish, in addition to maximizing the growth potential of the digital economy.

Furthermore, the European Parliament and the Council of the EU agreed in June 2015 to ban mobile roaming fees in 2017 and guarantee equal treatment for all internet traffic. On September 24th, the Commission released a press release wherein the Commission, as part of its Digital Single Market strategy, announced the launch of a public debate with two consultations. One consultation will focus on the issue of geo-blocking and how it could be regulated. Regarding geo-blocking, the EC notes as follows:

 ‘Geo-blocking’ is a practice which is frequently abused of by online service providers. During the July plenary MEPs set out their position on copyright reform, calling for ways to improve access to online content across borders, while recognising the importance of territorial licences, especially for TV and film productions. The aim of the consultation is to gather opinions on unjustified forms of geo-blocking due to the fact that such practices are stifling any potential growth in e-commerce and consumer confidence in online payments.

The second consultation is aimed at discussing possible regulation solutions regarding online platforms, online intermediaries, data and cloud computing, among other things. According to the press release:

Discussions shall also be held regarding the liability of intermediaries with regard to illegal content hosted online “(for example hate speech, child abuse content or content that infringes intellectual property rights), how far and in what way online intermediaries should respond, and what duty of care intermediaries may have towards their users”, and the possibility of a European cloud of data and how it would be managed.

It remains to be seen what these consultations will bring to the table and how the Commission will bridge the gap between the new crop of innovative services entering the market and the necessary legislation to regulate such services.