Vestager announces probe into e-commerce sector

Year-long inquiry could lead to antitrust cases and will feed into the Commission’s wider overhaul of the digital sector.

Margrethe Vestager, the European commissioner for competition, expects to launch a probe into the e-commerce sector in May, she announced on Thursday (26 March).

The “sector inquiry” will require companies to provide details of contracts and internal policies with the aim of understanding why only a limited number of consumers buy goods and services online across borders. It will feed into the European Commission’s efforts to overhaul Europe’s digital sector.

“Sound competition policy in fast-moving markets also requires thorough market knowledge,” Vestager told a conference in Berlin today. “We intend to identify what hampers competition in e-commerce when sales straddle national borders.”

Vestager said that while almost half of all consumers shop online, only 15% do so across borders.

While she recognised that this may in part be down to questions of language, she also accused online companies of undermining “cross-border trade by erecting technical barriers such as geo-blocking”.

EU competition rules prohibit companies from hindering trade between EU member states.

The Commission said that the inquiry’s conclusions would also feed into Commission’s wider work on the digital sector. Vestager said that the preliminary results may be online by mid-2016.

The Commission is expected to send questionnaires to holders of content rights, broadcasters, manufacturers, merchants of goods sold online, and online platforms such as price-comparison and marketplace websites.

Sectoral inquiries can prove very onerous for the companies involved.

Pharmaceutical companies complained that the Commission’s 2008-09 inquiry into that sector required a large time and resource commitment and provided few tangible results.

That eventually led to fines against several pharmaceutical companies for patent settlements – so-called ‘pay for delay deals’ that, the Commission concluded, infringed EU competition rules.

But many pharma companies maintain that such settlements are normal business practice and encourage greater, not less, innovation and competition.

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