The European Court of Justice (ECJ) has ruled on the criteria such as an online business with a ‘top-level’ .com or .eu domain name, or that has international dialing codes for phone numbers on its website, is more likely to be targeting foreign customers. The effect of the ruling is that, where a business is targeting consumers abroad, the jurisdiction for any action against the consumer by the business must be brought where the consumer lives.
Under a 2001 European Union Regulation called the Brussels I Regulation (which can be found here), a consumer can only be sued by a business supplier that ‘directs its activities in that consumer’s state’ in the consumer’s own domicile, but the consumer can choose whether to sue such a business in their own domicile or that of the business. The ECJ said that, for a business to be considered to be ‘directing its activities’ to one or more other ‘Member States’ (i.e. other countries within the EU), a number of factors should be considered by national courts. The factors include:
- the nature of the business (tourism would be an obvious pointer);
- use of phone numbers with international dialing codes displayed;
- use of ‘top level’ domain names such as .com or .eu or a top level domain name that is different to where the business is established;
- the currencies, languages and translations used on the site;
- referring to a country by name;
- money spent online to facilitate the placing of the business’s site in a way that is targeted to another country; and
- the mention of customers who live in other states.
For the full text of the ruling, click here.
As this case shows, anyone trading online with consumers may need to be prepared to fight legal battles in the courts of other countries. If they want to avoid that, they should seek appropriate legal advice.