Retail is the biggest sector in the EU non-financial business economy in terms of number of enterprises and persons employed. It alone represents 4.5% of value added and 8.6% of EU employment. Nearly 5.5 million companies are active in the EU retail and wholesale sectors (3.6 million enterprises in retail and 1.8 million in wholesale - 23% of all non-financial business economy in 2014). Most of them are SMEs, which also generate 66% of the sectors' value added and 70% of employment. Retail is also closely linked to other sectors of the economy (wholesale, manufacturers, farmers as well as transportation and logistics, and other business services). Moreover, the sector is bringing the Single Market to European consumers. Therefore, the competitiveness of the sector is essential to the EU economy.

The sector is currently undergoing fundamental changes with the rapid development of e-commerce, which is not only influencing the way consumers shop (they can shop online at any moment, often from websites located far away from where they live) but also modifies the landscape of the retail sector. Trends indicate that the future will be multi-channel retailing with retailers being active both offline and online (either through their own web shop or via platforms). Another trend is the creation of platforms that offer retailers the possibility to sell their products in online 'shopping centres'. Some of these platforms are not only providing such a virtual shopping centre but have launched their own range of products competing directly with their retail clients.

On 28 October 2015 the Commission adopted the Single Market Strategy which announced a series of initiatives and actions to remove economically significant barriers holding back Europe's jobs, growth and investment agenda.

The primary responsibility to regulate the establishment and operation of retail shops lies with the Member States. They have a margin of discretion in designing their regulatory frameworks provided they comply with the fundamental Treaty freedom of establishment and freedom to provide services as well as the Service Directive.

Integration of the EU retail market has to a large extent taken place through establishment across borders. The ten largest retail companies in the EU are multinational and some of them have shops in the majority of the 28 Member States. The regulatory environment they have to deal with when establishing is crucial for the success of such investments. With development of e-commerce, European retail markets are increasingly integrating also through distant sales across borders.

E-commerce provides new opportunities for retailers. Reaching out to consumers in other Member States has become easier in particular for smaller businesses. Online presence enables them to cross borders without the need to invest in physical premises. The cross-border expansion of retail also helps European consumers to benefit from the Single Market through an increased variety of the retail offer. Over 40% of European online buyers purchase products from abroad at least once a year and nearly 2 out of 3 have bought cross-border at least once in their life. Online platforms help SMEs to sell online and approach customers across the EU.

Digitisation is changing the retail sector in many ways. However, the regulatory frameworks have often been put in place decades ago and have not been adapted for the new reality created by e-commerce. Setting best practices for facilitating retail establishment and reducing operational restrictions in the retail sector must take into account the new retail reality which combines brick-and mortar and e-commerce in a multi-channel environment.

The purpose of this Public Consultation is to seek input from stakeholders for identifying best practices in the retail sector in the context of the above-mentioned follow-up actions of the Single Market Strategy. Commission services have already conducted extensive fact-finding on national retail legal frameworks and the public policy objectives behind these frameworks (detailed information can be found in the Roadmap). This public consultation is intended to complete this fact-finding exercise in particular on:

1. The implications of the growing importance of e-commerce and changing consumer habits for the retail sector and its regulatory framework

2. Opportunities and obstacles for the integration of the EU retail market

The European Commission is interested in views from all relevant stakeholders, in particular from retailers, relevant public authorities and consumers. As per the Better Regulation principles, the results of the public consultation will be duly published as well as the responses, provided the respondents agree to publicly disclose their contributions.