What you need to know about The eCommerce Directive following the transition period

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Online service providers need to start preparing for an end to the UK’s inclusion in the eCommerce Directive following the conclusion of the transition period between the UK and EU. 

The eCommerce Directive is a set of rules relating to online activities within the European Economic Area and allows member states to operate in any EEA country – whilst only having to operate within the rules of the country in which they’re based. 

However, once the transition period ends on 1st January 2021, this directive will no longer cover UK traders. 

The government is advising that businesses still wishing to sell online within the EEA consider whether their services ‘are currently in scope of the Directive and if so, ensure that you are compliant with relevant requirements in each EEA country you operate in’. 

Many online services provided by businesses may already comply with these requirements, but it’s worth checking now and making the appropriate changes if required before the end of this year. 

“The government intends to fully remove the eCommerce Directive’s Country of Origin principle from UK legislation, to bring EEA online service providers in scope of UK laws, which they were previously exempt from. As this principle is found in a number of pieces of legislation it will be removed at different points, when parliamentary time allows.”

Four steps to check compliance

The government has set out four steps to help businesses understand where they stand. They are:

  1. Check whether you are in scope: the eCommerce Directive applies to ‘information society services’, which covers things like payments, providing a service that can be used remotely and so on, These cover the majority of online service providers, including online retailers, video sharing sites, search tools, social media platforms and internet service providers. 
  2. Check where your service is based: This is your ‘place of establishment’ and is fixed to where you pursue your economic activity. 
  3. Check for new legal requirements: If your business is established in the UK, you should check for the legal requirements of an EEA country you currently and wish to continue operating in. Rules you need to pay attention to are those that fall within the ‘coordinated field’ and cover items including online information, advertising, shopping and contracting.
  4. Take appropriate steps: The government also recommends ensuring you have processes in place for ongoing compliance with individual EEA states and consider legal or other professional advice. 

Key further reading:

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