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The Main Features and Difficulties Regarding the Regulation of E-Commerce

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Laurynas Ramuckis 2118 02/02/04 La of E-Commerce; Prof. J. L. Basset The Main Features and Difficulties Regarding the Regulation of E-Commerce A narrow definition of the Electronic Commerce reads that an internet transaction is the sale or purchase of goods or services, whether between businesses, households, individuals, governments, and other public or private organizations, conducted over the Internet. The goods and services are ordered over the Internet, but the payment and the ultimate delivery of the good or service may be conducted on or off-line. 1 E-Commerce is an entirely new form of doing business, which ignores international borders of states. Traditional approach to commerce is yet more popular among the companies and individuals, however recent growth in electronic transactions creates a need for legislation and regulation of such commerce. Regulation of e-commerce faces two major disadvantages, first it involves a fast changes in the scope of e-commerce with changing technologies, and second, its' trans-nationality which leads to the question of which legal system should be applied in the regulation of electronic transactions. It has been concluded by the conference on e-commerce held in June 1998 by EC Commissioner Bangemann, that regulation on e-commerce should be kept to a minimum as the global nature of this commerce made government regulation impossible anyway: therefore industry self regulation was the way ahead. ...read more.


Thus far, the EU has been trying to enact directive which would not only bind its members but also include the third parties which would agree to it. Moreover, some type of development guiding the regulation of digital signatures is evolving globally through various organizations. By these means e-commerce is not banned from its' further development as global form of commerce. Another interesting development in the regulation of e-commerce is the aim of the US Government to police the Clipper Chip. However, gaining the access of communication by the agents of government was seen as harming some civil liberties, such as right to privacy. Hence, such an enactment is still a vulnerable issue. This leads us to another concern. That is E-privacy and the extent of its regulation. An attempt towards criminalization of the use of an encryption technology to hide a crime was seen in the USA. However, this hasn't been enforced with regards to the fact that the use of particular technology wasn't seen to qualify a criminal act by EPIC. Nonetheless, the first international attempt to establish a legal framework was taken by the OECD in other areas of e-commerce. It covers an area of cryptography and provides its' users with a choice of such method. Noticeably, it includes a provision that it is subjected to an applicable law. ...read more.


On the other hand, such an approach seems to be better than having no common standards as such. Taxation and the effective regulation of this process is another major problem in e-commerce. When new technologies are involved in money transfers it becomes easy to avoid taxes. Moreover, it is being argued that presently no taxes should be implied on the e-commerce as that could perpetrate its growth. Hence, the USA has introduced the Internet Tax Freedom Act, where it expresses strong opinion that no taxation should be implemented on the internet.4 The same tendency is seen throughout the world with regards towards taxation on the internet. The history of international law shows that it is very hard to convince majority of states to agree to the same terms. This will also be the case with regulating e-commerce. Since the regulation of e-commerce is in a development phase, no standardized clauses can be found. However the nature of such commerce itself demonstrates the urgent need for some globally standardized regulations. 1 Business to consumer electronic commerce, An update on the statistics, available at http://www.oecd.org/dataoecd/35/2/2367092.pdf 2 Bangemann M (1998) Launching a global business dialogue: business round table on global communications, available at http://www.ispo.cec.be/Ecommerce/english.htm 3 OECD (1997c) Cryptography Policy Guidelines and the Report on Background Issues of Cryptography Policy, OECD Privacy Guidelines in the Electronic Environment: Focus on the Internet, available at http://www.oecd.org/dsti/sti/it/secur/prod/GD97-204.htm 4 US House of Representatives (1998) Internet Tax Freedom Act (HR4105) ...read more.

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Response to the question

In summary, the report does show an in-depth understanding of how regulation could effect the growth of the internet in the near future. However case studies could be used to link the background understanding to a commercial environment. The report ...

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Response to the question

In summary, the report does show an in-depth understanding of how regulation could effect the growth of the internet in the near future. However case studies could be used to link the background understanding to a commercial environment. The report states how eCommerce websites should only have minimal regulation, to allow eCommerce websites to grow and develop. This section is good, as this clearly states the reasons to why there should be little regulation and the student has justified their reasoning.

Level of analysis

The report is quite in-depth, and each point is justified were appropriate. However the report is lacking a number of real case studies. For example the report could include how the regulation will effect a website such as HMV. The report could go further, and mention how the intended laws could impact on their business and their ability to grow using the on-line market.

Quality of writing

A number of technical terms are used and explained. For instance the term 'CAs' is explained and the student has given a brief definition. However there are a limited number of technical terms that are mentioned, however not explained. All technical terms will need to be explained, to allow the examiner to understand the report with ease.

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