Below is the relevant part of the EC new Internet Governance policy1 as it pertains to Legal and Regulatory issues.
8. CONFLICTS OF JURISDICTIONS AND LAWS
Like other cross-border activities, the Internet poses a series of challenges for the application of laws. While such challenges are not always specific to the Internet, the sheer quantity of cross-border transactions of various types which take place online, call for a more thorough reflection on how existing rules apply on the Internet.
Extraterritorial application of national law, often based on the geographies of the Domain Name System, has led to a number of contradictory legal decisions1. This can lead, for example, to cases where domain names used in one jurisdiction are revoked on the basis of provisions under another jurisdiction, depending on the geographical location of the registrar or registry.
Many activities on the Internet are increasingly governed by contractual arrangements between private companies and users on the Internet. Non-contractual obligations of ecommerce traders and intermediaries are also relevant in this context. The complexity and, in some cases, the opaqueness of these arrangements, including for what concerns provisions on applicable jurisdiction and law, may give rise to a certain degree of legal uncertainty.
From the point of view of private law, uniform European rules on jurisdiction and the recognition and enforcement of judgments and conflict rules exist in some areas, in particular in respect of contractual and extra-contractual obligations. These rules regulate such problems within the European Union. At the international level, conflict rules are insufficiently developed, leading to unsolved conflicts of laws beyond the Union. In particular for Internet related services that are inherently cross-border in nature, such as cloud-computing services, this complexity at international level can be harmful for growth.
Addressing the tension between an international Internet and national jurisdictions should also take into account the diversity of cases that can be subject to these conflicts, which are not apt to be addressed by one single mechanism.
The European Commission will launch an in-depth review of the risks, at international level, of conflicts of laws and jurisdictions arising on the Internet and assess all mechanisms, processes and tools available and necessary to solve such conflicts. All options for action at the Union or international level will subsequently be carefully considered, including possible legislative initiatives or additional guidelines as needed, subject to appropriate impact assessments. This work will build on existing policies.