Download Cosmetics Europe - European Commission

Cosmetics Europe response to open consultation on
Geo-blocking and other geographically-based
restrictions when shopping and accessing information
in the EU
Introduction
Cosmetics Europei thanks the European Commission for the opportunity to present its
position on geographically-based restrictions on-line in the European Union. It has taken
note of the format of the questionnaire developed by the Commission’s services and would
like to emphasize that the proposed format makes it hard for a trade association to provide
a true response that reflects accurately the view of the overall industry. The below answer
represents the position of the industry.
Cosmetics Europe Position on geo-blocking and other geographically-based restrictions
when shopping and accessing information in the European Union

Embrace the digital age while maintaining business freedom to meet consumer
needs
From being traditionally operating through brick and mortar shops, many of the members of
Cosmetics Europe and of its national associations are today fully embracing the new digital
area and are developing their marketing and sales activities in an omni-channel and crossborder environment. The position below reflects the positions of companies that sell both
off-line and on-line (via their own web-sites and/or through on-line retailers).
The cosmetics industry supports the objective of the Digital Single Market initiative to give
better access to goods and services on-line across Europe by addressing unjustified barriers
and by increasing the confidence of customers and businesses when they buy or sell crossborder in the single market. The industry fully recognizes the opportunities raised by the
development of a digital single market. However, it also notes the importance for business
to remain free to decide how it should itself best meet the consumers’ needs and to
organize its distribution in a way compatible with individual business structures.

Take un/justified geo-blocking situations on a case by case basis
Geo-blocking is defined as business practices resulting in different treatment –in terms of
price or other conditions – grounded on the recipient’s residence or nationality. Whilst geoblocking may on a case-by-case basis be considered as an unjustified technical measure to
block or limit access to a certain service, or to re-direct the consumer to an alternative website on a discriminatory basis, the targeted offers by suppliers to their consumers may be
objectively justified. No specific situations should be considered as de facto constituting
unjustified geo-blocking. Possible discriminatory practices must be addressed on a case-bycase basis and are best tackled by enforcing the existing single market acquis, or at least
based on principles which allow taking into account economic market realities.

One size does not fit all: Uphold fundamental principles of contractual freedom,
rights to pursue economic activity and the possibility for business to ensure
consumer needs and expectations can be satisfied in accordance with national and
EU laws
Cosmetics Europe considers that there are justifications to targeted on-line trade and that
any action by the legislator to prevent geo-blocking could not touch upon the fundamental
principles of contractual freedom and the manufacturers’ rights to freely pursue an
economic activity1. There is not a “one-size fits all” solution and companies should remain
free to adopt the business model of their own choice, depending on the type of products
sold. Companies when making the business decision whether, or how, to target customers
will take business driven decisions, depending on market conditions, and considering overall
operational or compliance costs as well as costs due to the location, such as delivery or VAT
costs. Consumer preferences or expectations are weighed in when making the cost-benefit
analysis. The consumer experience is paramount to industry. Cosmetics companies want to
be close to their consumers and the consumers shall feel comfortable that they can
approach the manufacturers and distributors in a way that meets their expectations.
Business and distribution models will additionally need to integrate regulatory requirements
and any potential liabilities that may be triggered in connection with the use of the
products.
1
The Fundamental Right to conduct one’s business is set out in Article 16 of the Charter of the Fundamental
Rights of the European Union
2
Moreover, and taking into account the above, compliance with the requirements of the
Cosmetics Products Regulation2 does not always enable companies to adopt an EU-wide
approach for the distribution of their products. This can be illustrated by the following
examples:

The harmonized Cosmetics Product Regulation imposes specific language labelling
requirements (Article 19.5 CPR) on the products sold. Therefore, to remain
compliant with the Regulation, companies will need to organize business in order to
provide for the logistics to label (or overlabel) products in the appropriate language
in case of cross-border sales. To that effect and for some national markets, the cost
of distribution/re-labelling for the purpose of on-line sales may not be economically
justified. In addition, in the case of a complete prohibition of geo-blocking,
companies could not anticipate on which markets their products would end up.
Arguably, companies would have to label products in all 28 EU languages which is
not possible out of practical (i.e., products are kept as small as possible out of
sustainable considerations) and economic reasons. Consumers would then be
confronted with health and safety labels in different languages, and companies
considered as non-compliant with EU law. Whether or not such sales can be
considered as passive sales and would therefore not be a problem for producers has
become more and more unclear recently.

Further, Article 23 of the Cosmetics Product Regulation imposes a strict
cosmetovigilance system whereby the Responsible Person3 shall report the
occurrence of any serious undesirable effect in a country to the competent authority
of that specific country. For their off-line and on-line sales, companies need to put in
place relevant notification systems. Therefore, to be able to enforce an efficient
cosmetovigilance notification system and ensure the highest level of consumer
confidence, companies may choose national on-line approaches to ensure that the
appropriate national services are available and customized to these specific
consumers (for example the need to be able to communicate with the consumers on
an undesirable effect in their national language).
2
Regulation (EC) No 1223/2009 of the European Parliament and of the Council of 30 November 2009 on
cosmetics products, OJ L 342/59, of 22.12.2009
3
The Responsible Person as defined in the Cosmetics Regulation is responsible for each cosmetic product
placed on the market and ensures its compliance with the obligations set out in the regulation. Typically,
companies will designate one single entity in the European Union as the Responsible Person.
3

Cosmetic companies make claims on their products that may vary between member
states. As recognized by case law of the Court of Justice of the European Union
companies when making claims shall take into account specific linguistic, cultural
and socio-economic factors that may justify national approaches4.

The general principle of the manufacturers’ right to freely pursue their activity
(recognized by case law of the CJEU and the Charter of Fundamental Rights) implies
that marketing strategies and advertising campaigns sometimes vary in timing and
from country to country. To that effect, targeted approaches that may also involve
specific Intellectual Property Rights may justify national wide approaches by the
manufacturers, to ensure consistency in the on-line and off-line environments.
Therefore Cosmetics Europe calls on the European Commission to:

Uphold the fundamental principles of contractual freedom and the rights to pursue
an economic activity to enable companies to satisfy consumer needs and
expectations while remaining in compliance with EU and national legislations; and

Consider that unjustified geo-blocking can only be tackled on a case-by-case basis.
Cosmetics Europe – The Personal Care Association is the trade association representing Europe’s EUR 70 billion
cosmetic, toiletry and perfumery industries since 1962. Cosmetics Europe membership includes international
companies and national associations of the European Member States and beyond. Cosmetics Europe represents
directly and indirectly the interests of more than 4000 companies ranging from international cosmetics
manufacturers to small family-run businesses operating in niche markets. Cosmetics Europe is based in
Brussels, Belgium and registered in the EU Transparency Register (No: 83575061669-96).
4
Case C-220/98, Estée Lauder Cosmetics vs. Lancaster [2000] ECR I-00117, paragraph 29.
4