UK: Disabled Access to the Internet, Lapsing Domain Names, Internet Protocol Version 6 (IPv6), Mispricing on the Internet and Other e-commerce News

1. Disabled Access to the Internet
2. ICANN Proposal for Grace Period for Lapsing Domain Names
3. Internet Protocol Version 6 (IPv6)
4. Mispricing on the Internet
5. Transfer of personal data to Canada - clarification of position
6. Electronic Signatures Regulations came into force on March 8th
7. Employment Practices Data Protection Code
8. E-Commerce Directive

The Disability Rights Commission published its revised Code of Practice on rights of access to goods, facilities, services and premises for disabled people on 26th February. The Code of Practice is used to interpret the Disability Discrimination Act 1995, and will be used by the courts in cases brought under the Act.

Access to websites is included in the scope of the Code and the Act, which means that website proprietors must take reasonable steps to ensure their websites are accessible to people with a wide range of disabilities and change any practices that hinder access. For example, text only versions of documents must be made available to allow visually impaired users access using a braille reader. The definition of “disabled” in the Act is very broad so the provisions of the Code of Practice are potentially far reaching.

New contracts for the design and maintenance of websites should therefore include detailed provisions spelling out the supplier’s obligations to ensure the website meets the requirements of the Act. In addition, changes to existing websites should be made, where necessary, in order to comply with the Act.

2. ICANN Proposal for Grace Period for Lapsing Domain Names

ICANN, the Internet Corporation for Assigned Names and Numbers, has announced a proposal to introduce a one month grace period for lapsed Internet domain names in the generic top-level domains, such as .com, .biz, .info and .net. The proposals mean that when an Internet domain name lapses inadvertently (for example on failure to pay a renewal fee, failure to update information with the registrar, or after a fraudulent request to delete the domain name by a third party), the deleted names would be placed on a hold status for a thirty day period, during which the registrant could reclaim the name.

Currently, registrars (sellers of domain names, who register the owner with a central registry operator) are required to give two notices of pending lapse of a domain name. There are no standards as to what form this notice must take, and it varies between registrars. Upon lapse, the registrar will submit a delete request to the central registry operator. The registry operator will then, in some cases, give a five day grace period in which the name can be re-registered.

During the proposed 30 day grace period, the domain name will not be active, but the domain name holder can apply for re-registration. The proposal is intended to provide a safety net against the risk of fraudulent attempts to delete domain names. At the recent meeting of the ICANN Board on 14 March 2002, the Board adopted a resolution to provide for the convening of a technical steering group in order “to develop a concrete proposal implementing the Redemption Grace Period Proposal, to be considered by the Board at a later meeting after posting on the ICANN website an opportunity for public comment.” We will keep you informed as the proposal progresses.

3. Internet Protocol Version 6 (IPv6)

The continuing spread of the Internet and its increased use by more and more devices means that there is a danger of running out of Internet Protocol (IP) addresses by 2005.

Every computer and other device connecting to the Internet, such as third generation mobile phones, needs a unique, numerical, IP address. Domain names are the user friendly connectors to these unique IP addresses. Currently, IP addresses are in the form prescribed by IPv4 (Internet Protocol Version 4), which uses 32 bits to represent addresses, meaning that there are just over 4,000 million IPv4 addresses (ie, 2³²). Given that the Internet is spreading to embrace forms of access and uses previously not considered, this number is not sufficient. Fortunately, a new protocol, IPv6, has been developed which uses 128 bits to represent IP addresses, allowing multiple billion numbers (ie, 2¹²⁸) of potential IP addresses. This will solve the crisis and allow developers free rein to introduce Internet access in various electronic appliances such as televisions, cars, radios and telephones.

The European Commission has identified a smooth and timely switch to IPv6 as essential to maintaining the European Union’s position as a leading IT economy. It has published a communication paper at http://europa.eu.int/eur-lex/en/com/cnc/2002/com2002_0096en01.pdf which includes a list of recommendations for EU Member States and for the Industry to ensure a cost effective and seamless transition to IPv6.

4. Mispricing on the Internet

Online selling has always been a grey area of law, and hence a potentially dangerous area for online retail businesses. The recent high profile Kodak case, where Kodak mistakenly priced a £399 camera at £199 on their website, has done nothing to clear the confusion. Word of the mistake spread quickly on the Internet and after being flooded with thousands of orders, Kodak succumbed to consumer pressure and agreed to honour the orders - a move that reportedly cost it £2 million.

The key legal question is whether a binding contract was formed when customers made their bid over the Internet. English law suggests that it was not, but the common practice of sending an acknowledgment of the order over the web could possibly give rise to a legally binding contract, which is binding on the retailer. The new European E-Commerce directive (still not implemented into English law), requires acknowledgment of an order to be sent immediately to the customer. Retailers are still free to tell customers that a contract is not created until a specified time after sending the acknowledgment, but this is at the risk of alienating thousands of Internet shoppers who can easily use the same delay to switch to an alternative website and make this purchase with a rival supplier who is not so risk averse.

5. Transfer of personal data to Canada - clarification of position

Under the Data Protection Act 1998 it is unlawful to transfer personal data to countries outside the EEA which lack an “adequate” level of protection.

Although the EU has approved (in Decision EC/2002/02) Canada's Personal Information Protection and Electronic Documents Act as providing adequate levels of protection, it is important to note that its approval is only in respect of personal data transferred to Canadian based recipients who are subject to the Canadian Act.

As noted in the Commission's Decision, the Canadian Act applies to private sector organisations and comes into force in stages. Until 1 January 2004, the Canadian Act will only apply to “an organisation, which is a federal work, undertaking or business”, i.e. an organisation which is regulated by Canadian Federal rather than Provincial legislation. After 1 January 2004, the Canadian Act will extend to every organisation that collects, uses or discloses personal information in the course of a commercial activity, whether or not the organisation is a federally regulated business. The Canadian Act also specifically excludes some types of organisations (e.g. charities).

If the Canadian based recipient is not subject to the Canadian Act, the transfer will not be covered by the EU's approval and it will be necessary to ensure the transfer comes within another of the exemptions to the ban on transfer, or that obligations are imposed on the third party under contract.

Please click through for the EU's Decision and the Canadian Act.

6. Electronic Signatures Regulations came into force on March 8th

Electronic signatures are increasingly being used to allow the authenticity of electronically transmitted documents to be verified. These signatures rely on electronic certificates, issued by so called certificate service providers (“CSPs”) to attest that the person using an electronic signature is in fact who they claim to be.

The Electronic Signatures Regulations 2002, which came into force on 8 March 2002, concern the supervision, liability and data protection requirements of such CSPs.

The key features of the Regulations are as follows:

• The Secretary of State is keep the activities of CSPs in the UK under review and also maintain a public register of CSPs;
• CSPs need to meet the best practice criteria in Schedule 2 of the Regulations if they are to issue “qualified certificates”. Qualified certificates are certificates issued by a CSP that contain all of the information detailed in Schedule 1 of the Regulations (such as any limitations on the use of the certificate and its expiry date);
• If a qualified certificate contains information that is incomplete or inaccurate (e.g. the person using the electronic signature is not who they say they are) the CSP may be liable in damages. The onus of proof is placed on the CSP to prove that they were not negligent;
• The CSP will also be liable if they fail to maintain an accurate certificate revocation register. Again the onus is on the CSP to show they were not negligent; and
• There are strict requirements in relation to Data Protection (obtaining and use of data) of CSPs established in the UK and non-compliance may give rise to an action for damages by any person who sustains loss or damage as well as civil proceedings by the Crown to enforce compliance.

7. Employment Practices Data Protection Code

The draft Employment Practices and Data Protection Code
Part 1: Recruitment and Selection (which has recently been published by the Information Commissioner) sets out recommendations as to how data protection law can be met in the areas of employee recruitment and selection. Although the obligation on employers is to comply with the Data Protection Act 1998 itself, failures to follow the Code could be cited by the Commissioner in any enforcement action as evidence of non-compliance.

Part 1 of the Code deals, in particular, with:

• managing data protection;
• advertising of vacancies;
• job applications;
• verification of applicants' details and pre-employment vetting;
• the short-listing and interview process; and
• retention of recruitment records.

Part 1 of the Code covers employees, job applicants, agency workers, casual workers and contract workers (both current and former), and reminds employers that individual employees have the right formally to request to see information held on them for a fee of no more than £10. Subject to certain exemptions, the employer must provide the information promptly and, in any event, within no more than 40 calendar days after receipt of the fee. Section 5 of the Code contains a useful checklist for employers to assist in implementing the Code.

To date, only Part 1 of the Code has been published. Part 2, which deals with employment records, is intended to be published shortly. Parts 3 (monitoring at work) and 4 (medical information) are to follow at monthly intervals thereafter.

Please click through for Part 1 of the Code.

8. E-Commerce Directive

On 7 March the Department of Trade and Industry released the draft of the Regulations that are to implement the E-Commerce Directive.

The aim of the Directive is to facilitate intra-EU electronic commerce through harmonisation and the removal of regulatory obstacles. The Directive applies to ‘information society services’, the definition of which is sufficiently wide to cover the majority of online activity provided for remuneration (e.g. sale of goods, advertising, video on demand and online databases). The Directive can apply whether communication takes place over the Web or by e-mail.

The key features of the Regulations are as follows:

• Online selling and advertising is subject to the laws of the UK if the trader is established in the UK; online services provided from other Member States cannot be restricted. There are exceptions, particularly concerning contracts with consumers and the freedom of parties to choose the applicable law.
• Recipients of online services must be given clear information about the trader (e.g. an address), the nature of commercial communications (e.g. if they are promotions or competitions), and how to complete an online transaction (e.g. through to the conclusion of the contract). If these (and other) procedures are not followed, the provider of the service (i.e. the trader in this case) can be liable in damages, and the resulting contact may not be enforceable.
• Online service providers are exempt from liability for the content that they convey or store under certain circumstances, e.g. hosting or caching.

The Government aims to implement the Regulations by early June of this year.

Please click through for the draft Regulations, guidance,
and the E-commerce Directive.

© Herbert Smith 2002

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