By Watson Charles Gale, email@example.com
In 1998 a global collaboration of CEO's interested in and concerned about the important growth of e-commerce created the Global Business Dialogue on electronic commerce (GBDe). The purpose of this forum was to address the urgent requirements for global implementation of systems and policies to assist in the realization of the potential of electronic commerce. In its deliberations the GBDe has focussed on recommendations that:
- will encourage global content;
- acknowledge the need for effective and efficient dispute resolution;
- and foster participation by small and medium business and business located in developing economies.
While there remain certain areas where consensus has not yet been reached, and a final paper has yet to be issued, extensive preliminary consensus has been achieved on many issues. This consensus generally flows from the principle that "inconsistent, local, national and international patchwork regulation and inflexible regulatory constraints will deprive consumers of the economic benefits of an innovative electronic marketplace".
Focussing on the benefits of self regulation and optimal use of technology, the GBDe is pursuing recommendations relating to the following issues:
- authentication and security;
- consumer confidence;
- content; information infrastructure;
- intellectual property rights;
- protection of personal data; and
The following is a very brief summary of the current thoughts of the GBDe in these areas.
Authentication and Security: Governments should provide a minimal legal framework focussed on ensuring the effectiveness of electronic authorization methods. Further regulations on the use and export of encryption technology should be abandoned.
Consumer Confidence: This is fundamental to robust electronic commerce and must be earned by ensuring transparency, security, privacy, clear rules of law and effective dispute resolution.
Content: Harmful and illegal content must be discouraged while freedom of expression maintained. Further, the protection of national cultural issues is recognized as legitimate provided such protection is not used as a barrier to trade. Both these will be difficult balances to achieve.
Information Infrastructure: Open, competitive and market driven standards should be the focus in order to develop the interoperable networks and environments which will be needed. The World Trade Organization can facilitate this process while recognizing that minimal regulation may be appropriate, but only until effective competition is established.
Intellectual Property Rights: Strong intellectual property protection and enforcement regimes, together with global harmonization of same must be encouraged.
Jurisdiction: Freedom of contract should be promoted with terms as agreed between the contracting parties. In the absence of such agreement, the law to be applied would generally be that of the seller. Consumer confidence is key to these matters and effectiveness, codes of conduct, trust marks, seal programs and efficient alternative dispute resolution mechanisms must be developed and harmonized.
Liability: An efficient legal framework is important for fully functioning e-commerce. The principle of "immediate offender pays" should be the general guide and support must be provided for monitoring, taking down or access blocking related to unlawful material. Intermediate service providers, however, should not be the focus of any monitoring regulation in this area.
Protection of Personal Data: The following five principles should be pursued:
- self regulation (based on OECD Privacy Guidelines)
- third party or self enforcement programs
- a clear and efficient consumer complaint process
- certain monitoring by governmental or quasi-governmental organizations
- limited use of legal regulation
Tax/Tariffs: Customs duties on electronic transmissions and new taxes on electronic commerce are opposed and tax matters generally should be focussed on achieving globally acceptable rules.
Recent Canadian and European Union Developments
Through efforts of the Working Group on Electronic Commerce and Consumers, Industry Canada, in November of 1999, set out certain principles of consumer protection. The guiding concerns that have been outlined are that
i. there should be equivalent protection for electronic consumers as there is for others,
ii. governments should work to harmonize laws in the area, and
iii. without compromising protection, the Canadian framework should be consistent with international initiatives in the field.
In brief, the six principles set out by the Working Group are as follows:
- there should be clear and sufficient information;
- an agreement to contract should be with a fully informed consumer intending to do so;
- protection of personal information must be respected;
- transactions should be secure;
- there should be access to fair, timely, effective and affordable dispute resolution;
- consumers should be protected from unreasonable liability.
(More detail on this framework can be reviewed on the Industry Canada website which is located at www.strategis.ic.gc.ca/SSG/ca01185e.html).
In a very recent development, the EU Council of Ministers gave approval to a directive establishing the legal foundation for e-commerce throughout the member states. This package includes initiatives relating to regulatory transparency mechanisms, protection of personal data, protection of conditional access services and electronic signatures. The EU directive will accelerate the harmonization of laws although it does not apply to certain personal data issues or matters of taxation.
Electronic commerce is having and will increasingly have a profound impact on business and on global economies. The speed at which e-commerce is expanding, combined with its huge impact, requires that we increase our focus on the fundamental issues associated with it and move quickly to establish standards and policies that are workable in the global electronic marketplace. The GBDe is but one forum for the possible resolution of these matters. Electronic commerce is a living and quickly changing field and serious attention is required to optimize its growth.
Watson Gale, a Partner in the Ottawa office, practices in the areas of technology, governance, policy and health. He can be reached at (613) 786-0158 or by e-mail at firstname.lastname@example.org. (Note: Additional information about the GBDe can be found at their site - www.gbde.org/.)
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.