Describes how widely e-Commerce is used, the primary sectors that sell through e-commerce, and how much product/service in each sector is sold through e-commerce versus brick-and-mortar retail. Includes what a company needs to know to take advantage of e-commerce in the local market and , reputable, prominent B2B websites.
Last Published: 8/8/2017
Denmark ranks among the leading countries in the world in terms of digital development, and almost all Danes have access to computers and internet at home and use a computer or mobile device every day.
In 2016, 97 percent of the population aged 15 years or more used the internet, and 80 percent of that population (3.7 million people) shopped online. The largest e-commerce markets are clothing, media and entertainment, shoes and lifestyle, and information technology. The average spending per e-shopper was USD 3,320 in 2015.
Smartphone-owners purchases more frequently, but not through the mobile phone
The m-commerce is growing, but it is still through pc and tablets, that see the largest turnover. Owners of smartphones and tablets purchases online more frequently than other users.  Dankort and Visa/Dankort is the most used payment system with approx. 85 percent of the online purchases.  MasterCard/Eurocard is used in 10 percent of all purchases, but we see a quick uptake with the introduction of app-based payment systems, such as Danske Bank’s “MobilePay”.
The most common products/services that consumers purchase online are cultural experiences and vacations.  Two out of three of the online consumers bought tickets for the theater, concerts or cinema, hotel accommodations, clothes, sports equipment and travel tickets.  On the other hand, few people buy medicine or groceries online, even though the trend for online purchase of groceries is growing rapidly with the introduction of new and flexible delivery solutions.  In general, female online shoppers buy more clothes, books, cultural experiences, food and groceries, whereas male online shoppers tend to buy computer hardware, games and electronics.  Only four percent of citizens in the EU gamble online, but that number is significantly higher in Denmark, where 18% of the population gambles online.
The Danish government is seeking to implement online services that are simpler and more effective and is seeking to discontinue paper applications submitted by regular mail.  Citizens of Denmark will each have a digital mailbox and will receive communication from the government through this.  In the near future it will be mandatory for businesses to access government services online, including payment transactions with the government.  Public schools, hospitals, nursing homes, etc. will be given subsidies to procure electronic applications that increase transparency and efficiency.  Patient data is soon to be shared amongst doctors and hospitals and there will be increased focus on home treatment of patients with chronic diseases.  The initiatives are intended to ensure that digitization efforts in the public sector will be coordinated and prioritized through wider and binding cross-governmental collaboration at all levels.
European Union Digital Single Market Initiative
Creating a Digital Single Market (DSM) is one of the ten priorities of the European Commission (EC).  The overall objective is to bring down barriers, regulatory or otherwise, and to unlock online opportunities in Europe, from e-commerce to e-government.  By doing so, the EU hopes to do away with the current 28 fragmented markets and create one borderless market with harmonized legislation and rules for the benefit of businesses and consumers alike throughout Europe.
The EC set out its vision in its May 6, 2015 DSM Strategy which has been followed by several concrete legislative proposals and policy actions.  They are broad reaching and include reforming e-commerce sector, VAT, copyright, audio-visual media services, consumer protection, and telecommunications laws.  Most of these proposals are currently going through the legislative process.   DSM-related legislation will have a broad impact on U.S. companies doing business in Europe.
The three main pillars of the strategy are:
Pillar I: Better access for consumers and businesses to digital goods and services across Europe
  • Better access for consumers and businesses to online goods and services across Europe
  • Remove key differences between the online and offline worlds to break down barriers to cross-border online activity.
Pillar II: Shaping the right environment for digital networks and services to flourish
  • Achieve high-speed, secure and trustworthy infrastructures and content services
  • Set the right regulatory conditions for innovation, investment, fair competition and a level playing field.
Pillar III: Creating a European Digital Economy and society with growth potential
  • Invest in technologies such as cloud computing and Big Data, and in research and innovation to boost industrial competiveness and skills.
  • Increase interoperability and standardization.
For more information, please see the European Commission’s “Digital Single Market” webpage and the European Commission’s "Digital Single Market Strategy for Europe" proposal.
The Electronic Commerce Directive (2000/31/EC) provides rules for online services in the EU.  It requires providers to abide by rules in the country where they are established (country of origin).  Online providers must respect consumer protection rules such as indicating contact details on their website, clearly identifying advertising and protecting against spam.  The Directive also grants exemptions to liability for intermediaries that transmit illegal content by third parties and for unknowingly hosting content.
Comprehensive Market Research on e-commerce in the EU is available upon request.
For more information, please see the European Commission’s “Boosting e-Commerce in the EU” webpage.
Value Added Tax (VAT)
The EU’s VAT system is semi-harmonized.  While the guidelines are set out at the EU level, the implementation of VAT policy is the prerogative of Member States. The EU VAT Directive allows Member States to apply a minimum 15 percent VAT rate.  However, they may apply reduced rates for specific goods and services or temporary derogations. Therefore, the examination of VAT rates by Member State is strongly recommended.  These and other rules are laid out in the VAT Directive.
The EU applies Value Added Tax (VAT) to sales by non-EU based companies of Electronically Supplied Services (ESS) to EU-based non-business customers.  U.S. companies that are covered by the rule must collect and submit VAT to EU tax authorities. From 1 January 2015, all supplies of telecommunications, broadcasting and electronic services are taxable at the place where the customer resides. In the case of businesses this means either the country where it is registered or the country where it has fixed premises receiving the service. In the case of consumers, it is where they are registered, have their permanent address, or usually live.
As part of the legislative changes of 2015, the Commission launched the Mini One Stop Shop (MOSS) scheme, the use of which is optional. It is meant to facilitate the sales of ESS from taxable to non-taxable persons (B2C) located in Member States in which the sellers do not have an establishment to account for the VAT.
This plan allows taxable persons (sellers) to avoid registering in each Member State of consumption. A taxable person who is registered for the Mini One Stop Shop in a Member State (the Member State of Identification) can electronically submit quarterly Mini One Stop Shop VAT returns detailing supplies of ESS to non-taxable persons in other Member States (the Member State(s) of consumption), along with the VAT due.
The Commission has received numerous complaints in relation to the new rules on ESS and is in the process of revising them.
The most important pieces of legislation on VAT are the EU VAT Directive 2006/112/EC and its Implementing Regulation 282/2011.
For more information relating to VAT on ESS, please see the European Commission’s “One Stop Shop and Audit Guidelines” webpage.

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