The European Commission is considering allowing brands to force companies selling items online to have bricks and mortar shops for customers to visit as well. This comes under guidelines called the Vertical Restraints Regulations (VRR) and comes under competition law.
Frankly this is nothing less than an assault on the customer’s right to choose. Found a better price for something from a seller on eBay?  If it doesn’t have actual premises, it might not be able to sell certain brands in future. Got a bargain on Amazon? Tough – it doesn’t have a shop you can visit so it could be banned from selling you this product.
It really is that simple. Europe is considering limiting choices to places customers can visit. This is more than slightly patronising. People are generally intelligent enough to decide when they want to buy on the Web and when they don’t.
According to an article by Amazon in today’s Wall Street Journal the people in favour of the new rules believe the more traditional businesses make more investment. They train their staff, they put the hours in, they pay their rents and it’s not fair that the pure-play e-tailers get the business as a result.
This is a specious argument. First, shoppers frequently compare prices online and check reviews for the best product only to then buy offline, but no one calls that free-riding. Second, the e-tailers bring a lot of their own skills to the market: logistics, web design skills, none of these should be written off. The investments in technology, structures and customer service are a different, but equally legitimate business model by all means but that’s all.
And until now, customers have been treated as intelligent people who can assess what they want to buy and whether they want to buy it online. This is now under threat and I’d urge everyone to write to the European Commission’s Competition section (see http://ec.europa.eu/competition/contacts/index_en.html) and their MEP (http://www.europarl.europa.eu/members/public/geoSearch.do?language=EN) to try and kill off this requirement to have a bricks and mortar store as soon as possible. They must fight to stand up for the consumer’s right to make an informed choice about when and how to buy.
(Declaration of interest: this blog is owned and paid for by eBay, but the views expressed are those of the author).

The European Commission is considering forcing companies selling items online to have bricks and mortar shops for customers to visit as well. This comes under guidelines called the Vertical Restraints Regulations (VRR) and comes under competition law.
Frankly this is nothing less than an assault on the customer’s right to choose. Found a better price for something on eBay? Hard luck, it doesn’t have actual premises so it can no longer operate. Got a bargain on Amazon? Tough – it doesn’t have a shop you can visit so it could be ruled unlawful.
It really is that simple. Europe is considering limiting choices to places customers can visit. This is more than slightly patronising. People are generally intelligent enough to decide when they want to buy on the Web and when they don’t.
According to an article by Amazon in today’s Wall Street Journal the people in favour of the new rules believe the more traditional businesses make more investment. They train their staff, they put the hours in, they pay their rents and it’s not fair that the pure-play e-tailers get the business as a result.
This is a specious argument. First, unless a supermarket (for example) actually invented bread, it’s already riding on someone else’s efforts. That’s entirely fair in business. Second, the e-tailers bring a lot of their own skills to the market: logistics, web design skills, none of these should be written off. The investments in technology, customer service and the consequent lower prices are a different business model by all means but that’s all.
And until now, customers have been treated as intelligent people who can assess what they want to buy and whether they want to buy it online. This is now under threat and I’d urge everyone to write to their MEP and kill off this legislation as soon as possible. The National Competition Authorities are meeting about VRR today and need to stand up for the consumer’s right to make an informed choice about when and how to buy – if this legislation wins through it’s a hell of a blow.
(Declaration of interest: this blog is owned and paid for by eBay).