Digital single market for Europe

What is the digital single market strategy?

The strategy is the EU's plan to create a free and secure digital single market in which people can shop online across borders and businesses can sell across the EU wherever they are in the EU. It seeks to expand the EU's digital economy to offer consumers better services at better prices and to help businesses grow.         

The strategy, which was published by the Commission on 6 May 2015, has three objectives:   

  • making it easier for consumers and businesses to access online products and services across Europe
  • improving conditions for digital networks and services to grow and thrive
  • boosting the growth of the European digital economy

Why do we need it?

European citizens face barriers when they use online services and tools. Online markets remain largely domestic: only 15% of citizens shop online from another EU country and as few as 7% of small and medium-sized businesses sell in another EU country.

Persisting regulatory barriers and market fragmentation lead to citizens missing out on goods and services and slow down the growth of businesses.       

According to the Commission, a fully functional digital single market could add as much as €415 billion to the EU economy a year. To unlock this potential, the EU plans sweeping reforms, ranging from a new copyright framework to parcel delivery and telecoms.         

In detail

A digital single market for Europe - COM (2015) 192

The Commission's strategy for the digital single market includes a number of legislative and non-legislative measures to be unveiled in 2015 and 2016. They are divided intro three 'pillars':

  • better access to online products and services 
  • better conditions for digital networks and services to grow and thrive
  • boosting the growth of the European digital economy

1. Better access to online products and services 

Reforming rules for online cross-border sales

This includes a Commission proposal to harmonise EU rules for digital content purchases, such as apps or e-books, EU rights for cross-border online sales of physical goods and improved consumers' rights. 

Improving cross-border parcel delivery

This will entail measures aimed to improve price transparency and regulatory oversight of the cross-border parcel market.

Ending 'geo-blocking'

The Commission has proposed a draft regulation to end so-called 'geo-blocking' - denying access to websites based in another EU country or charging different prices depending on a customer's location. 

Reforming European copyright law

The Commission will propose measures to ensure that content services, such as video services, can be used across borders. This would mean that people who have bought a film or music at home can enjoy it when travelling across Europe. The Commission will also step up efforts against infringements of intellectual property rights.

Cutting VAT-related red tape     

This includes measures to allow sellers of physical goods to benefit from single electronic registration and payment, and the introduction of a common VAT threshold to help start-ups get online.

2. Better conditions for digital networks and services to grow and thrive

Reforming EU telecoms rules

This includes measures that the Commission will propose:

  • to make spectrum coordination and management easier
  • to encourage investment in high-speed broadband
  • to improve the regulatory institutional framework

Reviewing rules for audiovisual media

This will include a review of the audiovisual media services directive, measures for the promotion of European works and the rules for the protection of minors and advertising.

Assessing the role of online platforms   

This will involve a Commission assessment of the non-transparency of search results, the use online platforms make of information they collect, relationships between platforms and suppliers, and restrictions on people's ability to switch between platforms.

There will also be an analysis of ways to tackle illegal content on the internet.

Boosting trust in digital services' handling of personal data

This includes a possible review of the e-privacy directive, which currently applies only to traditional telecoms companies and does not cover other providers of digital services. The Commission's review will be carried out after the entry into force of new EU rules on data protection.

This will also include the establishment of a public-private partnership on cybersecurity

3. Boosting the growth of the European digital economy

Building a data-driven economy  

The Commission will present:

  • a European 'free flow of data' initiative to get rid of barriers unrelated to personal data protection that hinder the free movement of data across the EU
  • a European cloud initiative, including the certification of cloud services      

Defining priorities for standards and interoperability 

This will focus on areas seen as critical to the digital single market, such as e-health, travel planning, e-freight or smart energy metering.    

Building an inclusive digital single market  

This will include measures to boost people's digital skills, which the Commission will incorporate into future initiatives on skills and training.

It will also include a new e-government action plan for 2016-2020. As part of this, the Commission will:

  • launch a pilot project to test the 'once only' principle that ensures that public administrations share certain data internally so that they don't have to ask again when they need to reuse it
  • seek to interconnect business registers across the EU
  • aim to create a 'single digital gateway' by integrating various existing European portals and services 

In the European Council   

At its meeting in October 2013, EU leaders called for a consumer and business-friendly digital single market. They said it was vital for growth and European competitiveness in a globalised world. 

The European Council reiterated the completion of the digital single market in 2015 as one of the EU's priorities at its meeting in June 2014.

At its meeting on 18 December 2014, the European Council asked the Commission to present an ambitious communication on the digital single market ahead of the June 2015 European Council meeting.

At their meeting on 25-26 June 2015, EU leaders supported the strategy and said it should be used to promote inclusive growth in all EU regions. They urged action to tackle market fragmentation, build necessary digital infrastructure and promote the digitisation of European industry.  They also called for a rapid adoption of new rules for telecoms, cybersecurity and data protection

In the Council

Culture ministers had a first exchange of views on the audiovisual aspects of the strategy on 18-19 May 2015. They supported the cross-border portability of content, the fight against illegal content and the need to find the right balance on copyright. They also stated that the territoriality principle is important for content creation, which means that geo-blocking should be reduced but might sometimes be justified.

Ministers agreed that the existing audiovisual media services directive should be adapted to technological changes. This review should:

  • guarantee media freedom and promotion of cultural diversity
  • keep the country of origin principle (each provider of audiovisual media services comes under the jurisdiction of only one member state)
  • streamline the procedure member states follow when they are the target of unacceptable content coming from another member state

Competitiveness ministers at the Council held their first exchange of views on the strategy on 28-29 May 2015. They agreed that the strategy covers the most important issues for building the digital single market. They underlined the importance of creating copyright rules that are fit for purpose, updating e-commerce rules, boosting consumer confidence, awareness and protection and insisted on the need for action to reinforce digital skills and data protection rules. 

They also identified a number of priority actions:

  • creating the right conditions for small and medium-sized businesses, especially start-ups
  • promoting the digitalisation of European industry
  • applying and extending e-governance in public administrations
  • increasing investments in digital infrastructure and networks
  • assessing the impact of fiscal rules on digital tools
  • considering the 'digital by default' principles for all new EU legislation  

Ministers also supported the creation of a European open science agenda, which would enable open access to publicly-funded research publications and related data. They  said that research should play a bigger role in the digital market strategy and contribute to digital innovation. 

Telecoms ministers also discussed the digital single market strategy at a meeting of the TTE Council on 11-12 June 2015. They welcomed its objectives and reiterated the importance of a digitised economy to promote jobs and growth and boost the EU's competitiveness.

Issues highlighted by ministers included:

  • the role of digitisation in stimulating entrepreneurship and SME growth
  • the need to enhance cybersecurity and build trust in e-services
  • the need for better infrastructure and improved broadband access for all citizens
  • a need to make parcel delivery pricing more transparent across the EU

Ministers also underlined that there should be good coordination on national level to ensure that the strategy is effectively implemented.  

On 15 June 2015, Justice ministers reached a general approach on the data protection regulation. This has allowed the Council and the European Parliament to start negotiations. The regulation will improve the protection of personal data, while improving opportunities for businesses in the digital single market. 

In May 2016, the Competitiveness Council agreed on the main principles to ensure portability of online content services in the internal market. The agreement enabled the Council to start negotiations with the European Parliament. 

They also adopted conclusions on digital single market technologies and the modernisation of public services

On 28 November 2016, the Competitiveness Council agreed on a draft regulation to ban unjustified geo-blocking between member states. The main objective of the proposal is to prevent discrimination for consumers and companies on access to prices, sales or payment conditions when buying products and services in another EU country. 

Once the European Parliament agrees its position, negotiations will start between the Council, the Parliament and the Commission. 

On 7 February 2017, the Maltese presidency reached a provisional agreement with European Parliament representatives to remove barriers to cross-border portability of online content services in the internal market. EU ambassadors endorsed the agreement on 15 February. After formal approval of the regulation by the Council and the Parliament, the new rules will start to apply in the first semester of 2018 (nine months after its publication in the EU's Official Journal). It will allow consumers who have subscribed or bought online content services in their home country to access it when temporarily present in another country within the EU.

On 20 February 2017, the Council agreed on a general approach to strengthen cooperation between national authorities responsible for the enforcement of consumer protection laws. The objective of the proposal is to modernise cooperation to further reduce the harm caused to consumers by cross-border infringements to EU consumer law. 

The general approach enables the Council to start discussions with the European Parliament under the EU's ordinary legislative procedure.