IMCO and JURI Committees of the European Parliament consider draft report on digital content

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On Tuesday 28 November, the Internal Market and Consumer Protection Committee (IMCO) and the Legal Affairs Committee (JURI) of the European Parliament held a joint session, in which they considered the draft report for the Proposal for a Directive on certain aspects concerning contracts for the supply of digital content. The consideration was an opportunity for the co-rapporteurs for the file to present and explain their report, and for other MEPs, including the shadow rapporteurs from the other political groups, to give their perspective on it.

Distinction between the digital content and tangible goods proposals

One of the key issues under discussion was the distinction between the digital content proposal and the tangible goods proposals, and how to ensure a clear division, avoiding any ambiguity between the scope of the two proposals.

Axel Voss (EPP, Germany), the co-rapporteur for the file for the JURI Committee, stated that the approach taken in the draft report was that anything with software should be governed by the digital content proposal, unless the manufacturer or retailer can demonstrate the contrary. His words were echoed by Evelyne Gebhardt (S&D, Germany), co-rapporteur for IMCO, who stated that the Commission’s proposal had failed to draw a clear distinction between the two, and that the decision that had been taken in the draft report was to draw a clear rule, in which anything related to data falls under digital content.

Several MEPs voiced their support for the distinction drawn by the co-rapporteurs. Several shadow rapporteurs for the file endorsed the approach, including Eva Paunova (EPP, Bulgaria), EPP shadow rapporteur for the IMCO Committee and Virginie Roziere (S&D, France), S&D shadow rapporteur for JURI. Despite this, Kaja Kallas (ALDE, Estonia), ALDE shadow rapporteur for IMCO, argued that some definitions in the draft report need to be clarified, citing in particular the case of embedded digital content and services.

In Ecommerce Europe’s view, it is extremely important that a clear distinction is drawn between the scope of the tangible goods proposal and the scope of the digital content proposal. For this reason, Ecommerce Europe has advocated for a distinction by which tangible goods with embedded digital content that is integrated in these goods, and which digital content forms an integral part of the functioning of these goods, should fall under the scope of the tangible goods proposal, thereby ensuring clarity and minimizing legal uncertainty.

Issues of payment for digital content using data

A further area of focus was the issue of how to regulate cases where payment for digital content is made using data. MEP Gebhardt emphasized this as a case issue in the legislation, and stated that the approach taken in the draft report was to keep the provisions in the Commission’s proposal, but also to emphasize the importance of compliance with the GDPR. She stressed the importance of not leaving the door open to legal uncertainty in this regard.

Several MEPs, including MEP Roziere, welcomed the clarification in the draft report on the exchange of data for digital content. However, Dan Dalton (ECR, UK), expressed his disappointment that the provisions in the proposal on exchanging digital content for data had been retained, and argued that it was trying to solve a problem that did not exist. He further argued that this provision risked creating a big problem in treating free apps in the same way as those for which you have to pay, which would create a big burden for the producers of free apps.

Next Steps

Moving forward, members of the IMCO and JURI committees will submit amendments to the co-rapporteurs’ report before the 11 January deadline, which will be considered on 22-23 March. The final vote on the proposal in Committee will be held on 30 May. Following this, it will be voted on in plenary, at a date that is to be confirmed. Ecommerce Europe will continue to advocate on behalf of its members for a Directive that provides maximum legal certainty and provides solutions that are future-proof in a rapidly developing sector.

 

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