David SatolaDavid SatolaSenior CounselSenior Counsel

dsatola@worldbank.orgdsatola@worldbank.org

Washington, DCWashington, DC

December 14, December 14, 20042004

Legal Framework for e-Development:Legal Framework for e-Development:Best Practices and Lessons LearnedBest Practices and Lessons Learned

           

   Government Government (“G”)(“G”)

Business (“B”)Business (“B”) Consumer (“C”)Consumer (“C”)

GovernmentGovernment G2G – G2G – coordinationcoordination

G2B – informationG2B – information G2C – G2C – informationinformation

BusinessBusiness B2G – government B2G – government procurementprocurement

B2B-e-commerce B2B-e-commerce between between businessesbusinesses

B2C – e-commerce B2C – e-commerce in consumer in consumer marketsmarkets

ConsumerConsumer C2G – e.g., tax C2G – e.g., tax compliancecompliance

C2B – price & C2B – price & other comparisonsother comparisons

C2C – auction C2C – auction marketsmarkets

Jonathan Coppel, E-Commerce: Impacts and Policy Challenges 4 (OECD Economic Department Working Paper No. 252 23 June 2000)

Types of Types of E-CommerceE-Commerce Activities Activities

•PolicyPolicy•LegalLegal•MarketMarket•Social and other local Social and other local considerationsconsiderations

and must take account of and must take account of •National vs. Cross Border National vs. Cross Border concernsconcerns

Enabling Environment is a mosaic of:Enabling Environment is a mosaic of:

The Legal Framework…The Legal Framework…

Will consist of a variety of legal instruments:

• Treaty and other int’l obligations

• Laws

• Regulations

• Official Acts, etc.

And should embody basic principles:

• Certainty

• Predictability

• Transparency

• Respect for local legal practice and customs

A Comprehensive Legal e-Enabling A Comprehensive Legal e-Enabling Environment Environment

Issues to Address vol. IIssues to Address vol. ICommunications Infrastructure Communications Infrastructure RegulationRegulation

Provision of Broadband services/accessProvision of Broadband services/access

Regulation of ISPs/service providersRegulation of ISPs/service providers

Communications RegulatorCommunications Regulator

Competition RegulationCompetition Regulation Abuse of DominanceAbuse of DominanceAnticompetitive Agreements/BehaviorAnticompetitive Agreements/BehaviorCompetition RegulatorCompetition Regulator

E-commerceE-commerce Scope/ExclusionsScope/Exclusions

Digital SignatureDigital Signature

Contract FormationContract Formation

Certification Authority/RegulatorCertification Authority/Regulator

X Border recognitionX Border recognition

Party Autonomy/VarianceParty Autonomy/Variance

Domain NamesDomain Names Regulation of registrationRegulation of registration

Network SecurityNetwork Security

Content RegulationContent Regulation

A Comprehensive Legal e-Enabling A Comprehensive Legal e-Enabling environment environment

Issues to address vol. IIIssues to address vol. IIData protection and Data protection and privacyprivacy

Data collection, storage, protection & useData collection, storage, protection & use

Data integrityData integrity

Opt-in/Opt-outOpt-in/Opt-out

Safeguards on search and seizure (including data interception)Safeguards on search and seizure (including data interception)

Data retentionData retention

SurveillanceSurveillance

Privacy Authority/RegulatorPrivacy Authority/Regulator

Consumer protectionConsumer protection

Intellectual propertyIntellectual property TrademarkTrademark

CopyrightCopyright

Electronic banking Electronic banking and financeand finance

Licensing of Financial Services provided by non-financial Licensing of Financial Services provided by non-financial entitiesentities

Secure Payment SystemsSecure Payment Systems

Information Reporting RequirementsInformation Reporting Requirements

Exchange ControlsExchange Controls

Consumer/Commercial CreditConsumer/Commercial Credit

Anti-money launderingAnti-money laundering

Financial Services RegulatorFinancial Services Regulator

A Comprehensive Legal e-Enabling A Comprehensive Legal e-Enabling environment environment

Issues to address vol. IIIIssues to address vol. IIITaxation and Taxation and customscustoms

Dispute Dispute ResolutionResolution

JudicialJudicial

Regulatory AdjudicationRegulatory Adjudication

ADR (arbitration, mediation, ODR, etc.)ADR (arbitration, mediation, ODR, etc.)

EnforceabilityEnforceability

Conflict of lawsConflict of laws JurisdictionJurisdiction

Applicable lawApplicable law

Recognition of foreign judgmentsRecognition of foreign judgments

Civil PenaltiesCivil Penalties Copyright/Trademark offencesCopyright/Trademark offences

financial lossfinancial loss

compromise of datacompromise of data

violation of network integrityviolation of network integrity

contentcontent

false/misleading advertisingfalse/misleading advertising

A Comprehensive Legal e-Enabling A Comprehensive Legal e-Enabling environment environment

Issues to address vol. IVIssues to address vol. IV

CCybercrimybercrimee

Access to/interference with systemsAccess to/interference with systems

Interception of/interference with dataInterception of/interference with data

Other misuse of devicesOther misuse of devices

ContentContent

Fraud (applicable to the electronic context)Fraud (applicable to the electronic context)

Forgery (applicable to the electronic context)Forgery (applicable to the electronic context)

Conspiracy-related offencesConspiracy-related offences

Copyright offencesCopyright offences

Regulatory Framework alone is not Regulatory Framework alone is not enough to “enable” “e”:enough to “enable” “e”:

Maturity of MarketsMaturity of Markets

Tradition of “independent” authoritiesTradition of “independent” authorities

Outlets to redress grievances, enforce Outlets to redress grievances, enforce rights, settle disputesrights, settle disputes

Status Quo

Issues Implementation

Reform ProcessReform ProcessIssue Identification & ResolutionIssue Identification & Resolution

Strategies

Policies &Objectives

Stage 3Stage 3Stage 2Stage 2

Stage 1Stage 1

LEGAL REFORMLEGAL REFORM

Broad Public ConsultationBroad Public Consultation

Stakeholder Buy-inStakeholder Buy-in

Local OwnershipLocal Ownership

Cur

rent

Str

uctu

re

New

S

truc

ture

Objective of Legal Framework DesignObjective of Legal Framework Design

Designing a legal framework that Designing a legal framework that responds to local needs and is responds to local needs and is informed by international informed by international experience…experience…

Increased Confidence and Use Increased Confidence and Use

UNCITRAL UNCITRAL http://www.uncitral.org/en-index.htm • Model Law on Electronic Commerce, 1996 with additional Model Law on Electronic Commerce, 1996 with additional

article 5 bis, 1998article 5 bis, 1998• Model Law on Electronic Signatures, 2001Model Law on Electronic Signatures, 2001• Convention – under preparationConvention – under preparation   

INTERNATIONAL INFLUENCESINTERNATIONAL INFLUENCES

UN/CEFACT – ebXML UN/CEFACT – ebXML   http://www.unece.org/cefact/ http://www.unece.org/cefact/

Unidroit Unidroit Cape Town Convention Cape Town Convention

http://www.unidroit.org/english/conventions/mobile-equipment/http://www.unidroit.org/english/conventions/mobile-equipment/mobile-equipment.pdfmobile-equipment.pdf

OECDOECD

WSISWSIS http://www.itu.int/wsis

• NetworkNetwork Security

• PrivacyPrivacy

• E-commerce Directive - 2000/31/EC of 8 June 2000E-commerce Directive - 2000/31/EC of 8 June 2000• Electronic Signature Directive - 1999/93/EC of 13 Electronic Signature Directive - 1999/93/EC of 13

December 1999December 1999• Distance Contracts Directive - 1997/7/EC of 20 May 1997Distance Contracts Directive - 1997/7/EC of 20 May 1997• Privacy and Electronic Communications - 2002/58/EC of 12 Privacy and Electronic Communications - 2002/58/EC of 12

July 2002July 2002

EU Selected DirectivesEU Selected Directives

REGIONAL INFLUENCESREGIONAL INFLUENCES

Examples as reflected in National Examples as reflected in National Legislation Legislation http://europa.eu.int/ida/en/chapter/424

http://europa.eu.int/ida/en/chapter/362

REGIONAL INFLUENCESREGIONAL INFLUENCESCont…Cont…

Council of Europe - Council of Europe - Convention on Cybercrime Convention on Cybercrime (ETS 185)(ETS 185)

http://conventions.coe.int/treaty/EN/cadreprincipal.hthttp://conventions.coe.int/treaty/EN/cadreprincipal.htmm

UNCECEUNCECE UNESCAPUNESCAP OASOAS CaricomCaricom ASEANASEAN APECAPEC

INDUSTRY & PRIVATE SECTOR INDUSTRY & PRIVATE SECTOR INFLUENCESINFLUENCES

SPeRS SPeRS http://www.spers.orghttp://www.spers.org

Hague Conference on Private International Law - Hague Conference on Private International Law - Draft Convention on International Jurisdiction and Foreign Draft Convention on International Jurisdiction and Foreign Judgments in Civil and Commercial Matters Judgments in Civil and Commercial Matters http://www.hcch.net/e/workprog/jdgm.htmlhttp://www.hcch.net/e/workprog/jdgm.html

International Chamber of Commerce – International Chamber of Commerce – Task Force on Task Force on Electronic ContractingElectronic Contracting•Draft ICC e-Terms 2004Draft ICC e-Terms 2004•Draft ICC Guide to electronic contractingDraft ICC Guide to electronic contracting

http://www.iccwbo.org/law/http://www.iccwbo.org/law/

OASIS OASIS http://www.oasis-open.org/home/index.phphttp://www.oasis-open.org/home/index.php

Current Factors Effecting Legal Current Factors Effecting Legal FrameworkFramework

Resonance and Dissonance of Resonance and Dissonance of

• Communications regulationCommunications regulation

• E-commerce applicationsE-commerce applications

• Communications/Critical Communications/Critical InfrastructureInfrastructure

• Financial sectorFinancial sector

• TechnologyTechnology

Break down silo approach to Break down silo approach to addressing issuesaddressing issues

Current IssuesCurrent Issues

1.1. Interoperability Interoperability

• Technical standardsTechnical standards

• cross border legal recognitioncross border legal recognition

• Protection of data privacyProtection of data privacy

• Protection of IPRsProtection of IPRs

2.2. Network security / critical Network security / critical infrastructureinfrastructure

3.3. JurisdictionJurisdiction

4.4. Cybercrime (including AML)Cybercrime (including AML)

5.5. Party autonomyParty autonomy

East Asia Pacific ExampleEast Asia Pacific Example

•Even where international models used, Even where international models used, X-border X-border interoperability is not ensuredinteroperability is not ensured

•General legislation may not expressly preclude legal General legislation may not expressly preclude legal validity of e-contracts, validity of e-contracts, applicability to on-line applicability to on-line world is not court-testedworld is not court-tested

•Legal Frameworks for Legal Frameworks for data privacy protection are data privacy protection are weakweak

•Consumer protectionConsumer protection “online” is underdeveloped “online” is underdeveloped

•Little specific in the area of Little specific in the area of CybercrimeCybercrime

23 countries benchmarked against 55+ criteria