January 11, 2012, 4:23 PM

The European Union unveils a plan to spur e-commerce

The EU aims to double e-commerce sales in Europe by 2015.

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The European Union released a 16-point plan today aimed at promoting e-commerce in the 27-nation economic union.

The EU says it plans to tackle obstacles, “which until now have frustrated the development of Europe's Internet economy."  

By doing so, it hopes to lift the share of e-commerce in retail sales from 3.4% to 6.8% by 2015. It also wants to double the value of the Internet sector’s share of Europe’s gross domestic product from 3% to 6%.

It’s the latest in a series of steps by the European Union to promote e-commerce, and particularly overcome obstacles to cross-border online purchasing. In a 2009 study, the EU found that while half of EU retailers were selling on the web only 21% took orders from consumers from other countries.

The European Commission, the executive body of the EU, acknowledged in the report released today that big obstacles remain to cross-border e-commerce.

“’Internet Europe’ is still a patchwork of different laws, rules, standards and practices, often with little or no interoperability,” the report says. “This hinders the development of online services and undermines the confidence of existing or future users on both the supply and the demand side. Lack of knowledge of the rights conferred, the applicable rules and the opportunities that the digital economy offers reinforces their reluctance. The practical difficulties related to cross-border transactions (payments, deliveries, dispute resolution, risk of abuse) discourage people from taking full advantage of the Internet to purchase or supply their goods and services.”

To overcome these obstacles, the plan aims to:

  • facilitate cross-border access to online products and content
  • solve problems of payment and delivery
  • address the issue of consumer protection and information
  • assist dispute resolution and removal of illegal content. 

By 2015, says the Commission, online trade and services could account for more than 20% of growth and job creation in some of the eurozone’s 27 countries including France, Germany, the United Kingdom and Sweden.

“The Internet economy creates 2.6 jobs for every "off-line" job lost, and offers a better choice to consumers,” the Commission says in its report.

“The development of electronic commerce and online services offers enormous potential for beneficial economic, social and societal change. The gains brought by lower online prices and a wider choice of available products and services are estimated at EUR 11.7 billion euros (US$14.9 billion), equivalent to 0.12% of European GDP.”

Several other of the plan’s initiatives aim to eliminate impediments to the development of e-commerce, which the Commission says are preventing consumers and business from investing fully in online services.

These include:

  • Ignorance & uncertainty about applicable rules
  • Offers that lack transparency & are hard to compare
  • Payments and modes of delivery that are often expensive and unsuitable.

According to the Commission, “If 15% of retail sales were e-commerce and the obstacles to the internal market were removed, the gains for consumers might be as much as 204 billion euros (US$259.2 billion), or 1.7 % of European GDP.

The EU has made several moves in recent years to whittle away at obstacles to cross-border online shopping. In one move last year, the European regulators imposed new rules that require European e-retailers to adopt generous returns policies. A year earlier, the European Parliament approved a trust mark retailers could put on their web sites to indicate their reliability.

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