The digital association Bitkom has expressed skepticism about the decisions of the EU Council of Ministers on the EU Directive on Contract Law for Digital Content. This directive aims to introduce a specific consumer law at the EU level for digital goods such as apps, music, films, or games, as well as services provided online.
Startups at a disadvantage: “Out of touch with reality”
At the same time, the principle of "data as currency" would be enshrined in EU law for the first time. This means that, for example, an app offered for free download would be treated the same as a paid one if the user provides personal data to the provider in return. This would ensure that consumers are entitled to warranty rights such as repairs, updates, or returns even for free offers.
“Especially with free offers such as apps or games, claims for repairs are not based on reality,”
says Bitkom-General Manager Dr. Bernhard Rohleder.
"The regulation would affect the many small providers of free apps. In many cases, apps lack commercially viable business models. The legislature is overshooting the mark with such obligations. Startups that quickly bring innovative solutions to market will be overwhelmed by such regulations and could suffer a competitive disadvantage compared to providers that can grow in other, less strictly regulated markets."
No benefit for consumers — providers in trouble
In practice, according to Bitkom, warranty claims for free digital goods would always result in the rescission of the transaction, as repair or improvement makes no sense for the provider. This would mean the consumer would have to delete the app and get their data back. However, the latter right is already granted under the new European General Data Protection Regulation (GDPR): Any user can request the deletion of their data without giving a reason. Rohleder:
"The new contract law for digital content gives consumers a right they already have today. This doesn't help consumers, but it does create great uncertainty for providers of free digital content."
