The proper functioning of the Internal Market in electronic commerce is ensured by the Internal Market clause, which means that information society services are, in principle, subject to the law of the Member State in which the service provider is established. In turn, the Member State in which the information society service is received cannot restrict incoming services.
Examples of services covered by the Directive include online information services (such as online newspapers), online selling of products and services (books, financial services and travel services), online advertising, professional services (lawyers, doctors, estate agents), entertainment services and basic intermediary services (access to the Internet and transmission and hosting of information). These services include also services provided free of charge to the recipient and funded, for example, by advertising or sponsorship. (Electronic commerce)
The European Union is maintaining momentum in its efforts to regulate the Internet and electronic commerce, especially with respect to conflicts of law in cyberspace. A directive establishing a common legal framework for electronic commerce within the European Union1 E-commerce Directive) was adopted in early summer 2000, enshrining the "country of origin" principle in the on-line environment. Effectively, this principle means that an on-line retailer established in one of the European Union member states is allowed to offer e-commerce services on-line throughout the European Union as long as it meets the legal requirements of its country of domicile. However, the legal certainty established by the E-commerce Directive is already under threat. The European Commission intends to revive an idea from 1967 regarding the creation of a Council Regulation2often called Rome II Regulation.
Another closely related instrument is the regulation on jurisdiction and the enforcement of judgments in civil and commercial matters (the Brussels