The European Union has passed a law requiring non-EU companies to collect Value Added Tax (VAT) on sales of electronically delivered merchandise and services to customers living in the European Union. This law went into effect July 1st, 2003. This does not apply to items that are physically shipped. The VAT is calculated based on the country in which the customer is located.
If you would like to learn more about the VAT charges, please see this page:
http://ec.europa.eu/taxation_customs/index_en.htm