Europe has ruled (PDF) that e-books can be lent out just like their physical counterparts. That is, as noticed by Ars Technica, one copy can be "checked out" by one person at a time. After the lending period expires, that user can no longer use the book and it goes to the next person who wants it. This might sound kind of expected, but you have to remember that it took until 2014 for the European Union to approve digitizing library books in the first place. And even then, you could only use them within the library's walls and at dedicated terminals.
The sticking point was between the Dutch library association (Vereniging Openbare Bibliotheken) and Stichting Leenrecht, a group that works to ensure authors are compensated for their work. The Court of Justice of the European Union -- essentially Europe's Supreme Court -- is okay with the traditional approach for digital lending assuming that the books were lawfully purchased in the first place.