Ladies and Gentlemen,
It is a pleasure for me to open the first panel of this conference on the digital competitiveness of the European Union.
I also thank Mr Radek Špicar, Executive Director of the Aspen Institute in Prague, for giving me the opportunity to bring you the latest news on the Data Protection Reform.
Allow me to start by busting a little myth that has been bothering me now for some time.
Too often I have heard that high privacy standards and innovation go in opposite directions. Well, no. I do not agree with that point of view.
It is in fact quite the contrary.
Companies have to innovate in response to user demand for privacy. And we know well that a majority of Europeans are feeling very insecure about using online services. Only 22% of European citizens have full trust in Internet companies such as search engines, social networking sites and e-mail services. Put simply, almost 80% of European citizens do not trust the Internet.
So how could we expect the Digital Single Market to take off if most of its key players, the European citizens, shy away from the Internet?
Citizens' trust in online services must be restored!
This is a message that privacy-friendly companies have heard loud and clear! Many of them are investing in more secure data centres and in 'privacy by design'
Because stakes are high, very high.
The value of European citizens’ personal data has the potential to grow to nearly €1 trillion annually by 2020.
So strengthening Europe’s high standards of data protection is not a burden to innovation. It means business, big business.
And more business will create more jobs. We expect 3.75 million extra jobs created in the EU by 2017.
All this goes to show, Ladies and Gentlemen, that high privacy standards and innovation are both part of the same grand scheme: boosting the Digital Single Market and bringing Europe back on the growth path. Innovation and data protection are a continuum. The one and same virtuous circle.
[State of play on the data protection reform]
Today I am pleased to announce that adoption of the data protection reform is getting closer.
Why am I so optimistic? I personally opened the trilogues with Rapporteur Jan Albrecht and Justice Minister Braz and I could see a real commitment to reach compromises and to arrive at a good result, for citizens and business.
Once adopted, around the end of 2015, the new data protection regulation will be a key enabler for a strong Digital Single Market.
Not only will it help restore citizens' trust in online services by strengthening their data protection rights, it will also simplify the legal environment for businesses and the public sector.
Let me remind you of three of its main features:
• First, the Regulation will introduce a single set of rules on data protection, valid across the EU.
• Second, but equally important: our governance model. Businesses will only have to deal with a single national data protection authority in the EU country where they have their main establishment. At the same time, citizens can turn to the authority in their own country, in their own language.
• Finally, the same rules will apply for companies from the EU and from outside the EU. We want to promote a level-playing field for every organisation that wants to process the data of EU citizens.
The new data protection rules will have teeth. We proposed that companies which do not comply with the new rules will be fined. Depending on the seriousness of the breach, the fines could reach up to 2% of their annual turnover.
Once they know that their personal data is safe, citizens will feel safe shopping abroad online, they'll buy digital products online, and they'll use apps and online services.
Furthermore, thanks to the "right to data portability" a citizen will find it easier to move his or her personal data from one information society provider to the other. They will feel in control of their personal data - a feeling that two thirds of citizens do not have nowadays.
From the outset of this Commission mandate, together with Vice-President Ansip and several of my colleagues, we have focussed on making European citizens benefit from the digital revolution. Within the Digital Single Market we want people to be able to "buy-like-at-home" and companies to "sell-like-at-home".
The Digital Single Market should allow consumers across Europe to access the best products at the best prices offered by European businesses.
Unfortunately we are not yet there: EU-wide only 15% of consumers bought online from other EU countries (44% domestically) in 2014 and only 7% of businesses sold their products cross-border online. Consumers could save EUR 11.7 billion each year if they could choose from a full range of goods and services when shopping online.
For this reason the Commission will submit a proposal to further boost online trade, in particular cross-border. We will put forward harmonised rules for online purchases of digital content and for contractual rights for domestic and cross-border online sales of tangible goods.
Certain consumer protection rules such as pre-contractual information and the right of withdrawal, were recently harmonised across the EU by the Consumer Rights Directive that took effect in June 2014. However other issues such as tackling defective goods are barely covered at EU level. And on digital content there is a real gap.
The Commission's proposal for simple and effective cross-border contract rules for consumers and business will fill these gaps in a targeted way.
This will boost consumers' confidence and allow them to shop in other EU countries as easily as in their home countries. And, of course, consumers will be well protected.
On the other hand I also want to create a business-friendly environment: businesses, and especially SMEs, should not have to bear the brunt of extra transaction costs and legal uncertainty caused by differences between national contract laws.
I am working on this proposal in close cooperation with stakeholders and Member States experts. This kind of cooperative and transparent preparation is very important to me.
As e-commerce knows no borders, I am also working on strengthening enforcement cooperation mechanisms in 2016. This can only be achieved by revising the Consumer Protection Cooperation Regulation.
The Online Dispute Resolution platform, for instance, will be a concrete tool of the Digital Single Market: it will help businesses and consumers solve disputes arising from online purchases in a fast and cost-effective way. I expect it to be operational in January 2016.
Ladies and Gentlemen,
President Juncker said that "a strong EU justice and consumer policy can build bridges between national and legal systems and be a key part of reaping the full benefits of the Single Market, cutting red tape and facilitating cross-border trade."
I wholeheartedly agree. And you can help us make it happen.