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Abstract: The question of the legal nature of the so-called country of origin principle in Article 3 of the EC E-commerce Directive causes great confusion. Many, including e-service providers, advocate that the provision should be understood as a choice of law rule designating the law of the place of establishment of the service provider as applicable. However, Article 1(4) of the Directive explicitly states that no additional rules of private international law are created. Is there a conflict within the Directive or can such a conflict be avoided? There are basically three ways in which the country of origin principle could be understood: (i) the E-commerce Directive establishes a choice of law rule for the law applicable to e-commerce services, irrespective of the provision in Article 1(4); (ii) the country of origin principle of the E-commerce Directive only sets out certain limitations to the application of the designated law; (iii) the Directive makes the rules of the home country of the service provider internationally mandatory and thus applicable irrespective of what law is applicable to the contract or tort etc. This article analyses the three alternatives and advocates the last solution as the one which is not only line with the legislative intent but also permits the Directive to maintain logical coherence.