EC formally introduces Digital Single Market plan to boost region’s tech economy

After months of planning, the European Commission has officially submitted an ambitious set of reforms aimed at creating a Digital Single Market across the continent.

The plan contains 16 proposals, but it has three general aims. The EC wants to make it easier for consumers to access digital goods and services across borders to create more choice and competition; give European startups a boost by making it easier to launch in different countries; and create uniform regulations in areas like data and privacy that come with tougher enforcement.

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“Digitization has changed the environment we live in,” said Andrus Ansip, the EC’s vice president for Digital Single Market, at a press conference in Brussels. “The internal market is not functioning as it should.”

Overall, the EC is hoping the new regime will give European startups an advantage by allowing them to grow quickly across borders. The conventional wisdom in Europe is that U.S. tech companies have a big head-start because they can expand across their home country quickly, and achieve a size that makes it difficult for a company founded in France or Germany to compete.

At the same time, tougher regulations are aimed at giants like Amazon, Google, and Facebook to slow them a bit in their march toward world domination. The net result of these two missions, EC officials hope, will be to create a more level playing field for European startups.

“We want companies in Europe to use the Digital Single Market to scale up, not move out,” Ansip said.

You can read the full plan here. A summary of the 16 proposals is here.

The proposals, among other things, would make it easier to ship parcels ordered online across borders, end geoblocking that prevents subscribers to online content from accessing services in other countries, and update telecom rules to let service providers operate across borders and reduce things like roaming fees.

On the enforcement front, the EC simultaneously launched a wide-ranging e-commerce antitrust investigation today. While the announcement doesn’t specifically name companies, its targets likely include Amazon, which has been accused in the past of offering wildly different prices to customers in different EC countries while not allowing users to order from its different country sites to shop for better deals.

The fact that Europe is not more integrated on the digital front can be a bit surprising to Americans who assume that virtual economies were as closely linked as the physical ones as Europe sought to erase its economic borders over the years.

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But in fact, many of the rules around things like data, privacy, entertainment content, and e-commerce, are still governed by rules created by the EC’s 28 member states.

As a result, according to the EC, only 15 percent of European citizens shop online from another EU country; only 7 percent of small businesses sell across borders; and governments are also failing to adopt digital tools.

The EC estimates that creating a Digital Single Market would create “hundreds of thousands” of new jobs and boost Europe’s economy by almost $460 million each year.

The DSM proposal will now be reviewed by the European Parliament, which must ultimately approve it. There was no official timetable given for when EC officials hope it be put to a vote.

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