A very important decision on combating unfair online practices that affect consumers, but also businesses in the CEFTA economies is waiting for its adoption by the CEFTA Joint Committee. What this decision means for regular people, companies, and the economies?

CEFTA Decision on the Prevention of Unjustified Geo-blocking is all about stopping unfair restrictions and discrimination against customers based on where they live. Imagine this: you want to buy a fantastic gadget online, but because you live in a particular place, the website won’t let you. CEFTA says, “No more!” They want to make sure everyone can shop freely.

In the context of the CEFTA decision, “geo-blocking” refers to the practice of blocking or restricting access to online goods, services, or content based on a user’s geographical location or origin.

For example, imagine you’re in Bosnia and Herzegovina and you want to access a certain online service or purchase a product from a website based let’s say in Albania. Geo-blocking is a practice preventing you from doing so by redirecting you to a different website (e.g. partner company in Bosnia and Herzegovina) or by displaying a message that the service is not available in Bosnia and Herzegovina. This CEFTA decision aims to prohibit such unfair practices, ensuring that consumers can access and use online services and make purchases from businesses wherever in CEFTA they are without discrimination based on their location or origin.

How does geo-blocking work?

Geo-blocking can be conducted through various technical and legal methods. Here are some common ways:

1. IP Address Blocking: Websites and online services can detect a user’s IP address, which provides information about their geographical location. Geo-blocking can occur by denying access to users with IP addresses from specific locations. For example, a website might only allow access to users with IP addresses from Albania.
2. Location-Based Redirects: When you visit a website, it can automatically detect your location and redirect you to a version of the site tailored for your region. This can include displaying content in the local language, offering region-specific pricing, or showing products or services relevant to your location.
3. Location-Specific Domain Names: Websites may have different domain names or URLs for specific locations. Access to these domains can be restricted based on the user’s geographical location. For instance, a website with a “.mk” domain may be accessible only to users in North Macedonia.
4. Payment Information: Some online services may require users to provide payment information, such as a credit card with a billing address in a specific place. If a user’s payment information doesn’t match the required location, they may be denied access or redirected to a different version of the service.
5. Legal Agreements: Companies can enter into legal agreements with content providers or licensors that restrict the distribution of their content to a specific location. Geo-blocking may occur as a result of contractual obligations.
6. Licensing and Copyright Restrictions: Content providers, such as streaming services and media companies, may have licensing agreements that limit the distribution of their content to certain locations due to copyright and licensing restrictions. As a result, users in some economies may not have access to certain content.

It’s important to note that while geo-blocking can be used for various reasons, including compliance with laws, licensing agreements, and market strategies, it can also lead to concerns about discrimination, access to information, and consumer choice. Therefore, the question is what kind of geo-blocking is unjustified and thus outlawed with this CEFTA Decision.

Are there situations where geo-blocking is justified?

Although geo-blocking is unacceptable in many segments, there are exceptions. The CEFTA rules exclude services related to the protection of copyright or protected subject matter in an intangible form (streaming music and electronic books). Audio-visual, financial, health and social services are also excluded. Geo-blocking is also justified in the case of suppression of illegal activities and content on the Internet.

Unfair Geo-blocking and Discrimination? Not Anymore, as CEFTA is bringing all its Parties onto the same page!

The CEFTA decision aims to address unjustified geo-blocking practices that unfairly restrict access to goods and services within its Parties. The decision is part of the wider aim to create common rules to make sure that nobody gets treated unfairly when shopping online. It’s like making sure everyone speaks the same language when it comes to online shopping.

Who Benefits?

1. Consumers: This decision is great news for the shoppers. No more being blocked from buying something just because you do not live in the same place as the e-merchant. It means we’ll have more choices and fair access to goods and services online.
2. Businesses: For companies, this decision will help them to expand their customer base. Businesses can reach new customers, tapping into previously inaccessible markets, leading to increased sales and revenue.
3. Economy: The decision makes trade more equal and transparent, benefiting the entire CEFTA economy and the region as a whole. When businesses have more customers, they can grow, hire more people, and create more jobs and help raise the living standard.
4. The region: Applying EU geo-blocking rules, the whole region is one step closer to the European Union.

When can results be expected?

The adoption of the Decision by the CEFTA Joint Committee is crucial for implementation, as it will require a certain period for the businesses to adjust their practices and governments to enforce these rules. Moreover, once adopted, the Decision will enable application of the EU rules within CEFTA, while the new EU Growth Plan for the Western Balkans will also seek their application with the EU.