[Ecommerce] Jurisdiction Dispute Heats Up in Europe

[James Love]

http://www.thestandard.net/article/display/0,1151,20366,00.html

November 22, 2000, 12:02 PM PST 

Jurisdiction Dispute Heats Up in Europe 

The EU is expected to rule that e-commerce disputes should be settled in
the courts of the consumer's country. Trade groups say this would be a
big mistake. 

     By Paul Meller

BRUSSELS – The European Commission is set to hand down regulations at
the end of the month that could have major effect on the development of
electronic commerce in Europe, and some trade groups don't like what
they see. 

Ambassadors from the 15 member states of the European Union are
preparing the agenda for a meeting of justice and home-affairs ministers
in Brussels at the end of the month. Those ministers will decide the
final shape of a regulation that would decide whose court cross-border
legal disputes go to. For instance, which country has jurisdiction when
there is a dispute over an online transaction between a consumer in one
EU country and an e-commerce Web site based in another? 

The commission has proposed that courts in the consumer's country should
handle online disputes. Industry groups, however, want jurisdiction to
go to the country where the supplier is based. 

"Industry believes that the commission's approach could hamper the
growth of e-commerce in Europe," the groups said. The trade groups that
signed the
statement include the European Mail Order Traders Association, the
European
Publishers Council, the Federation of European Direct Marketing, the
Internet Advertising Bureau and the American Chamber of Commerce in
Belgium. 

Financial institutions are also concerned about the shape of the new
regulation.

  [snip]


Consumer representatives sound equally alarmist when defending the
country-of-destination principle. "If the 'country of origin' principle
were applied to e-commerce, as industry is demanding, then in a
cross-border legal dispute, the consumer would have to deal with
different legislative codes," said Ursula Pachl, legal adviser to
European consumer watchdog BEUC. 

"It's even more unreasonable to demand that of consumers," she said.
"Who needs more protection? I'd say it is the consumer." 

   [snip]

Three countries are believed to have concerns with the proposed
regulation: the U.K., Ireland and Luxembourg. However, none has said it
will veto the regulation at the ministers' meeting on Nov. 30 and Dec.
1. 

   [snip]

If all 15 justice ministers decide to side with consumers, a glaring
contradiction in EU laws would be created because the member states are
adopting an e-commerce directive that says that the laws of the country
of destination should apply to cross-border online transactions. 

If the jurisdiction regulation is adopted before the e-commerce
directive becomes law in the EU nations, the directive might be thrown
back to the commission for rewriting, said Alastair Tempest, director
general at FEDMA, the European federation of direct and interactive
marketing. 

   [snip]