WRITTEN QUESTION E-3515/98

by Amedeo Amadeo (NI) to the Commission

(25 November 1998)

Subject: Globalization and the Information Society

Having regard to the Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions - Globalization and the Information Society - The need for strengthened international coordination (COM(98) 50 final), the Commission mentions, in connection with access to the market, the significant obstacle of the high cost of telecommunications, whilst recognising that considerable price reductions have occurred as a result of falling costs and greater competition.

Whilst it is not the task of the authorities to regulate prices, which must be left to the interaction of free market forces, can the Commission endeavour to ensure compliance with the principles of transparency (including inter alia the ability to compare prices and services) and of the provisions governing competition and dominant positions?

Joint answer

to Written Questions E-3514/98 and E-3515/98 given by Mr Bangemann on behalf of the Commission

(12 January 1999)

All markets need rules of the game in order to function effectively. The electronic marketplace is no exception. A clear and stable regulatory environment will enable businesses to exploit new market opportunities and generate trust and confidence in this new medium for consumers. In principle, there should be no discrimination between off-line and on-line regimes. Public authorities need to remove or update old rules where they create undue barriers to market developments, and need to set up new rules where a legal vacuum gives rise to uncertainty. Governments increasingly have to acknowledge that where voluntary codes of conduct or technological solutions developed by businesses and users prove to be effective, it may be unnecessary to introduce regulations.

In a global electronic marketplace where services do not stop at frontiers, national or regional rules can no longer be introduced in isolation if they are to be correctly enforced. Similarly, conflicting national rules will create uncertainty. The borderless nature of the Internet means that any internal solution within the Community should take into account this global dimension. Currently, 90 % of trade in the Community is intra-Community. However, growth of electronic commerce is likely to give rise to an increase in the proportion of extra-Community trade. Consumers will increasingly be comfortable buying on-line from foreign providers. This points to the need to build consensus on guidelines at a global level as underlined in the communication on globalisation and the information society(1).

This is not to say that securing the internal market for electronic commerce is a secondary goal. In fact, solving the trans-national problems inherent in guaranteeing the free movement of services throughout the internal market places the Community in a strong position to lead discussions at international level.

The need to take the global dimension into account in the policy-making process can already be seen in the Community. For instance, even where international guidelines exist, for example the Organisation for economic cooperation and development (OECD) guidelines on privacy, European-wide regulation may be required to fill in gaps or to provide a higher level of protection. On the other hand, the proposed directive on electronic signatures(2) foresees cooperation mechanisms with third countries to ensure the mutual recognition of certificates under strict conditions.

The creation of a sound and stable Europe-wide regulatory environment for electronic commerce reinforced by the introduction of the euro will provide European companies with a major competitive advantage in the global electronic marketplace. In April 1997, the Commission adopted a communication on a European initiative in electronic commerce(3) which outlines key measures which are still needed to boost the growth of electronic commerce in Europe. These regulatory and accompanying measures are to be implemented by the year 2000. At regulatory level, the required directives have now been tabled by the Commission(4). It is hoped that they will make speedy progress through the Parliament and the Council in order to meet these deadlines.

In general, the approach has been to generate more certainty in the market by removing obstacles to the free flow of services throughout the internal market and, where appropriate, to encourage the implementation of self-regulatory codes of conduct. This means that companies established in the Community wishing to order goods or sell services by electronic means in the Community will have to comply with the legislation of only one Member State, rather than 15 different sets of rules.

The Community must also continue to participate actively within international fora in order to arrive at globally agreed regulatory principles. This requires strengthened international cooperation in policy-making, not only between governments and international organisations, but increasingly among the global business community. Therefore initiatives such as the Bonn conference, the World trade organisation (WTO) work programme on electronic commerce, the OECD ministerial conference, as well as the creation of the global business dialogue, following the round table meeting with global business leaders organised by the Commission in June 1998, should be welcomed.

(1) COM(98) 50 final.

(2) OJ C 325, 23.10.1998.

(3) Communication from the Commission to the Council, the Parliament and the Economic and Social committee and the Committee of the regions - A European initiative in electronic commerce - COM(97) 157.

(4) COM(97) 628 final, OJ L 144, 4.6.1997, OJ L 281, 23.11.1995, OJ L 24, 30.1.1998.