philippines e-commerce roadmap 2015 to 2020 - june 30 draft

Enabling Business, Empowering Consumers

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Enabling Business, Empowering Consumers Confidential. For authorized use only.

E-Commerce Definition � Philippines E-Commerce Law – Republic Act 8792.

Passed June 2000. ¡  Any kind of data message and electronic document

used in the context of commercial and non-commercial activities to include domestic and international dealings, transactions, arrangements, agreements, contracts and exchanges and storage of information.

¡  Electronic transactions made through networking among banks, or linkages thereof with other entities or networks, and vice versa.

� E-Commerce Back-Office Operations Thrive (now referred to as Business Process Outsourcing)

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The Philippines’ IT-BPM Industry by Sector

Sources: BPAP, ACPI, CCAP, GDAP, HIMOAP, PSIA

67.0%

18.6%

9.0%

Share of Total PH IT-BPM, 2012 100% = US$13.1 billion

Voice

KPO/Back Office

ITO

HIM

ESO

Animation

Game Dev

1.6% 1.0%

3.5%

0.4%


Philippine IT-BPO industry size 2006–2012; US$ billion

x% YoY Growth

1 Philippines IT-BPO market as percentage of global offshore services market, in revenue terms Sources: BPAP, ACPI, CCAP, GDAP, HIMOAP, PSIA

# FTEs (~‘000) 236 383 424 527

Global share1 5% 6% 6% 7% 8%

3.44.5

6.17.1

8.9

11.0

13.2

2006 2007 2008 2009 2010 2011 2012

34% 17%

25%

24%

FTEs Revenue (US$M)

Rev % inc.

fr ’11

Voice BPO 497,000 8,697 18%

Non-voice BPO/KPO

154,380 2,470 20%

ITO 57,078 1,160 17%

Health Info Mgt & Care

45,000 460 66%

Engineering Services

10,836 206 20%

Animation 9,000 132 3%

Game Development

3,500 50 251%

TOTAL FTEs 776,794 13,174 19%

19%

284 640

9.5%

777

Philippines 2012 Performance

31% 45%


Framework for the Promo.on of E-‐Commerce in the Philippines*

5 *E-Commerce Office-Department of Trade and Industry, Philippines

“Trust is central to any commercial

transaction”

I NF RA DE V E L OPMENT


Background � Last August 2014, Senator Bam Aquino at the

Senate Hearing on Trade about E-Commerce Concerns tasked the Department of Trade and Industry to develop an E-Commerce Roadmap to fulfill the implementation of the E-Commerce Law (Republic Act 8792).

� Meetings began last December 2014 and the DTI E-Commerce Office is currently working on completing this roadmap.

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A Joint Project of

WITH THE SUPPORT OF

Philippines E-Commerce Index

Copyright 2014, I-Metrics Asia-Pacific Corporation. All rights reserved.


Chart 1: Extent of Online Engagement in the Manufacturing Industry Overall Index, Weighted to Actual Values


JAN 2015 – MAR 2015 AUG 2013 – MAR 2015


Chart 5: Extent of Online Engagement in the Manufacturing Industry Percentage of Revenues By Sector

Food & Beverage = 23%

Textiles = 39%

Paper = 8%

Publishing, Printing = 19%

Fuel, Chemicals, Pharmaceuticals = 24%

Rubber & Plastic = 19%

Non-Metal Construction Materials = 20%

Basic Metals = 23%

Fabricated Metal = 21%

Machinery & Equipment = 26%

Communication Equipment, Appliances = 40%

Motor & Transport Equipment = 32%

AUG 2013 – MAR 2015

Source: I-Metrics Asia-Pacific Corporation Survey, March 2015

Note: Percentage of revenues derived online are based on interviews with a sample of 174 supply chain executives of top manufacturing companies based in the Philippines drawn from a probability sample of 600

top manufacturing corporations representing the top manufacturing corporations in the Philippines.


Chart 9: Extent of Online Engagement in the Manufacturing Industry Percentage of Purchases By Sector

Average for Manufacturing Industry

Food & Beverage = 34%

Textiles = 36%

Paper = 11%

Publishing, Printing =40%

Fuel, Chemicals, Pharmaceuticals = 18%

Rubber & Plastic = 40%

Non-Metal Construction Materials = 30%

Basic Metals = 24%

Fabricated Metal = 28%

Machinery & Equipment = 40%

Communication Equipment, Appliances = 43%

Motor & Transport Equipment = 30%

AUG 2013 – MAR 2015


Note: Percentage of revenues derived online are based on interviews with a sample of 174 supply chain executives of top manufacturing companies based in the Philippines drawn from a probability sample of 600

top manufacturing corporations representing the top manufacturing corporations in the Philippines.


Chart 4: Extent of Online Banking in Manufacturing, Unweighted


JAN 2015 – MAR 2015 AUG 2013 – MAR 2015


Chart 1: Extent of Online Engagement in the Retail/Wholesale Industry Overall Index, Weighted to Actual Values


JAN 2015 – MAR 2015 AUG 2013 – MAR 2015


Retail = 14%

Wholesale = 28%

Chart 15: Extent of Online Engagement in the Retail/Wholesale Industry Percentage of Revenues By Sector

Average for Retail/Wholesale Industry

AUG 2013 – MAR 2015


Note: Percentage of revenues derived online are based on interviews with a sample of 94 supply chain executives of top Retail/Wholesale companies based in the Philippines drawn from a randomly selected

panel of 200 top retail/wholesale corporations.


Retail = 26%

Wholesale = 35%

Chart 19: Extent of Online Engagement in the Retail/Wholesale Industry Percentage of Purchases By Sector

Average for Retail/Wholesale Industry

AUG 2013 – MAR 2015


Note: Percentage of revenues derived online are based on interviews with a sample of 94 supply chain executives of top Retail/Wholesale companies based in the Philippines drawn from a randomly selected

panel of 200 top retail/wholesale corporations.



JAN 2015 – MAR 2015 AUG 2013 – MAR 2015

Chart 5: Extent of Online Banking in Retail/Wholesale (Unweighted)


Chart 1: Extent of Online Engagement in the Services Industry Overall Index, Weighted to Actual Values


JAN 2015 – MAR 2015 AUG 2013 – MAR 2015


Construction = 25%

Electricity, Gas, and Water = 3%

Hotels & Restaurants = 9%

Transportation = 31%

Postal, Media & Telecomm = 7%

Banking and Finance = 22%

Provident and Insurance Co’s = 5%

Real Estate = 6%

Miscellaneous Business Activities = 16%

Health and Social Work = 13%

Business & Knowledge Processing = 34%

Chart 5: Extent of Online Engagement in the Services Industry Percentage of Revenues By Sector

Average for Services Industry

AUG 2013 – MAR 2015


Note: Percentage of revenues derived online are based on interviews with a sample of 94 supply chain executives of top Services companies based in the Philippines drawn from a probability sample of 300 top

services corporations representing the top services corporations in the Philippines.


Chart 5: Extent of Online Engagement in the Services Industry Percentage of Purchases By Sector

Average for Services Industry

Construction = 25%

Electricity, Gas, and Water = 14%

Hotels & Restaurants = 43%

Transportation = 30%

Postal, Media & Telecomm = 8%

Banking and Finance = 22%

Provident and Insurance Co’s = 10%

Real Estate = 13%

Miscellaneous Business Activities = 21%

Health and Social Work = 3%

Business & Knowledge Processing = 33%

AUG 2013 – MAR 2015


Note: Percentage of revenues derived online are based on interviews with a sample of 94 supply chain executives of top Services companies based in the Philippines drawn from a probability sample of 300 top

services corporations representing the top services corporations in the Philippines.



JAN 2015 – MAR 2015 AUG 2013 – MAR 2015

Chart 5: Extent of Online Banking in Services, Unweighted


Chart 7: E-Commerce Engagement as a Percent of GDP (2014)

Ecommerce Intensity Index: Purchases of Top Corporations in Manufacturing, Retail/Wholesale, and Services Transacted Online as

a Percentage of GDP .

E-Commerce Intensity Index: Revenues of Top Corporations in Manufacturing, Retail/Wholesale, and Services Done

Online as a Percentage of GDP



Vision: E-Commerce as an Economic Growth Contributor & Philippines Competitive Advantage

Business Objectives & Success Criteria

Fast & Cost Competitive

Internet Access

50,000 business do e-commerce

50 million Filipinos do e-

commerce

E-Government E-Payment

Implementation

Cybercrime Enforcement &

Prosecution

E-Commerce Intensity at 25%

of GDP

GOAL


Philippines ECommerce

Roadmap

Internet Access

E-Government

Logistics

Consumer Protection

Law Enforcement

Tax system

Electronic Payment

E-Banking Data Privacy

Information Security

Policies

Seal of Trust

Education

Sector development

Leadership


E-Commerce Supply Chain

UPSTREAM

•  Internet access

•  Logistics • E-Payment • E-Banking

INTERNAL VALUE CHAIN

• Consumer Protection

•  Law enforcement

• E-Government • Tax system

for e-commerce

• Data Privacy Commission

• Policy Creation

DOWNSTREAM

•  Seal of Trust • Education •  Sector

development • Private Sector

Leadership


Upstream

Internet Access

Cost

Accessibility

WIFI propagation

Partnership

Logistics

Presence

COD

Taxes

Customs Process

ONLINE STRATEGY


Deliverable – Internet Access

NEED OUTPUT TARGET DATE

PLAYERS

Lack of Internet infrastructure standards & master plan. Impacts quality performance and pricing competitiveness. Lack of players offering Internet services

Philippine Internet Broadband Masterplan (DILG) Update the Telecommunications Law and NTC Charter. Fair Competition Law Get new telecoms & VAS players.

2015 2017 2015 continuing

NTC, Telcos, DTI, DOST, Congress DILG, Private Sector

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Deliverable – Logistics


PLAYERS

Lack of awareness on Customs taxes and duties causes confusion among SMEs buying and selling products online.

Philippine National Trade Repository Implementation of National Single Window Project v.2 (make it mandatory) Philpost as COD outlet. Approve Customs Modernization Law.

2015 BOC, DTI, DOF, BIR, DOST-ICTO, PhilPost, all concerned government agencies, Couriers, Private Sector 40 players (computerization)

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Deliverable – Logistics NEED OUTPUT TARGET

DATE PLAYERS

Various import permit documents not yet automated for application / approval. Philippines not fully ready for cross-border e-commerce

Import permit electronic application / approval across agencies to be fully implemented. (those that are necessary only) Guidelines for cross-border mutual recognition of digital signatures, electronic communication & contracts.

2015 BOC, DTI, BIR, PhilPost, Couriers, Forwarder, Private Sector BOC, DTI, DA, DOH, NTC, DOF, BIR, government agencies, forwarders, courier, private sector 27


Upstream

E-Payment Regulation

Arbitration

E-Wallet

Merchant Protection

E-Banking Access

Security

Regulation

Services

ONLINE STRATEGY


Deliverable – E-Payment

NEED OUTPUT TARGET DATE PLAYERS

Lack of e-payment & e-wallet monitoring authority for non-banks offering non-legal tender services (commodity) poses risks and problems to merchants & consumers.

E-Payment and E-Wallet Guidelines for Non-Banks Payment Gateway Registration National Retail Payment Systems Payment Systems Act

2015 DTI, BIR, BSP, Private Sector BSP, DTI, private sector

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Deliverable – E-Banking


PLAYERS

Lack of E-Banking Services Standards hampers adoption of e-banking by all banks offering updated minimum services needed today including IBFT and Escrow.

E-Banking Services Standards (covering updated minimum e-banking services)

2015 BSP, DTI, BAP, RBAP, Private Sector

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INTERNAL

Consumer Protection E-Promotions

Advertising Claims

Web Presence Guide

Complaints Handling

Law Enforcement Complaints Handling

Cooperation

Public awareness

Public Attorneys

ONLINE STRATEGY


Deliverable – Consumer Protection


PLAYERS

Lack of online process for consumer complaints affects consumer confidence in doing e-commerce.

Merchant and Consumer Complaint Online Dispute Resolution Process.

2015 DTI, DOH, DA, ConsumerNet, Private Sector

The Consumer Protection Act needs to adjust and recognize changes in merchant-consumer landscape

Update the Consumer Protection Act.

Improve sales promotion approval process

Sales Promotion for Online. Onine Application for Sales Promotion.

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Deliverable – Law Enforcement


PLAYERS

Lack of online process for cybercrime reporting and legal assistance making it difficult for consumers to file reports and sustain their complaint.

Cybercrime Online Reporting and Legal Assistance Network Cybercrime Investigation & Coordination Center National Computer Emergency Response Center

2015 2016 2016

PNP, NBI, DOJ, DOST-ICTO, National Security Council AFP, DTI, BSP, Private Sector

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INTERNAL

E-Government

E-Payment

Data Privacy

Transparency

Funding

Data Privacy

Commission

Complaint handling

Guidelines

Reporting of breaches, data privacy compromise

ONLINE STRATEGY


Deliverable – E-Government NEED OUTPUT TARGET

DATE PLAYERS

Lack of efficient e-government services to serve stakeholders making e-commerce redundant and tedious.

Government E-Payment Implementation Plan (use of PH-PAY) Allow government agencies to purchase online using credit card by reimbursement. Expansion of the National PKI, Digital Certificate for Public & Private Sector

2015 DBM, DTI, DOST ICTO, BSP, DOF, Bureau of Treasury, Congress, Private Sector

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Deliverable – Data Privacy


PLAYERS

Lack of Data Privacy Commission not giving an avenue for complaints to be filed in violation of the Data Privacy Law

Data Privacy Guidelines for the Government Push for the creation of Data Privacy Commission Data Privacy Guidelines for the Private Sector

2015 DTI, DBM, DOST-ICTO, DOF, Bureau of Treasury, BSP, COA, Private Sector DTI, Private Sector

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INTERNAL

Tax System

Process consultation

Electronic Invoice & Official Receipt

Tax guidelines

Education

Policy Creation

Sales Promotion Guidelines

Online Advertising Claims

Product Safety Verification

E-Government Fund

ONLINE STRATEGY


Deliverable – Policy Creation

NEED OUTPUT TARGET DATE PLAYERS

Lack of e-notary guidelines affecting implementation on e-commerce for transactions requiring notarization

Rules on E-Notary

2015 Supreme Court, Department of Justice, PNP, NBI, DOJ, DOST-ICTO, DTI, BIR, BSP, SEC, DILG, Private Sector

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Deliverable – Tax System


PLAYERS

Lack of easily accessible and usable invoicing and official receipt tools for use by freelancers, online direct sellers, and small e-commerce sites online.

Build a System for Online Sales Invoice and Official Receipt Issuance

2015 BIR, SEC, DTI, Private Sector

Guidelines for Online Sales Invoice & Official Receipt Issuance

Tax simplification Suggest & push amendments to Tax Code / Law 39


DOWNSTREAM

Seal of Trust Accreditation Guidelines

Privacy Seals

Security Seals

Verified Seals

Education E-Learning Adoption

B.S. E-Commerce

Diploma E-Commerce

K-12

ONLINE STRATEGY


Deliverable – Seal of Trust


PLAYERS

Lack of seal providers to authenticate e-commerce sites offering products and services online

Accreditation for Data Privacy, Security, and Identity Verification Seal Issuers.

2015 Philippine Accreditation Bureau, DTI, BIR, BSP, SEC, DILG, Private Sector

Lack of accredited digital signatures issuers for local Internet users.

Update Guidelines on accreditation of certificate authorities.

2015 Philippine Accreditation Bureau, DTI, BIR, BSP, SEC, DILG, Private Sector

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Deliverable – Seal of Trust


PLAYERS

Consumers need to know if an online store is registered and can be trusted.

BIR Registered Seal to be given to active taxpayers (at least 1 year). To be listed online.

2015 BIR, DTI, BSP, SEC, DILG, Private Sector

Sellers asking if online business requires separate registration

BIR Guideline for Online Business whether website is primary office or branch.

2015 BIR, DTI, BSP, SEC, DILG, Private Sector

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Deliverable – Education


PLAYERS

Lack of e-commerce education curriculum to meet industry demand on e-commerce adoption.

B.S. E-Commerce E-Commerce subjects offering in Colleges Diploma in E-Commerce offering in vocational schools E-Commerce Education in K-12

2015 DTI, CHED, TESDA, DepEd, Private Sector

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DOWNSTREAM

Sector development

Manufacturing

Retail / Wholesale

Services

Start-up

Private Sector Leadership

Associations

RITECC

Consumer Groups

Online Communities

ONLINE STRATEGY


Deliverable – Sector Development


PLAYERS

Lack of programs to support businesses in adopting e-commerce.

Establishment of E-Commerce Office in DTI to develop programs, issue policies, resolve concerns, and monitor e-commerce adoption

2015 DTI, DBM, Private Sector

One Stop Shop Business Center

DTI, SEC, BIR, DILG, CDA, and related agencies.

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Deliverable – Sector Development


PLAYERS

Lack of digital certificate registration authority to facilitate in identity verification.

Philippines PKI Forum •  Encourage growth

in Certificate Authority and Registration Authority entities.

2015 DTI, BIR, BSP, SEC, DILG, DOST-ICTO, Private Sector

Improve Internet Governance Towards Trustworthy & Secure E-Commerce.

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Deliverable – Private Sector Leadership


PLAYERS

Lack of organized multi-private sector participation to work with the government in developing and monitoring e-commerce growth in the country.

Establishment of E-Commerce Promotion Council comprised of the government and private sector whose tasked is to work on the various deliverables in this roadmap.

2015 DTI, DBM, BSP, DOF, Bureau of Treasury, BIR, COA, DOJ, PNP, NBI, Private Sector Associations, Online Communities

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Risk Management

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RISK MANAGEMENT RISK CONSEQUENCE MITIGATION CONTINGENCY ASSIGNED

Internet speed, cost, & access not improving.

Filipinos unable to do e-commerce.

Create Internet Roadmap with telcos

Work on how to encourage more players in the market.

NTC, DTI, private sector

Unregulated payment gateways, virtual currencies and electronic wallet close shop affecting consumers.

Filipinos merchants, consumers unable to get back their funds.

Create payment gateway, virtual currency, and e-wallet regulation for non-bank entities.

Use legal means to penalize and ensure consumers will get their money back.

DTI, BSP, law enforcement, private sector



Philippines unable to participate in cross-border ASEAN Single Window

Filipinos unable to reap ASEAN Single Window opportunities and advantages.

Implement National Single Window. Work on policies for cross border electronic communication & digital certificate recognition

Work with 3rd party players that will allow private sector entities participate and meet requirements necessary.

DTI, BOC, DOST, private sector

Cybercrime, data privacy, consumer complaint concerns increase with no resolution.

Filipinos confidence in doing e-commerce low.

Creation of merchant and consumer online dispute resolution process. Cyber Crime Reporting & Legal Assistance

Seek cross-border legal assistance as needed for tracking cybercrime perpetrators outside of PH.

DTI, BSP, law enforcement, DOJ, private sector



Consumer information privacy gets compromised

Pose damage, inconvenience to affected consumers.

Creation of Data Privacy Commission. DTI to release data privacy guidelines on e-commerce in government & private sector

Apply penalties and legal liabilities for violating Data Privacy, Cybercrime, E-Commerce Law.

DTI, law enforcement, private sector

Unsustained leadership in e-commerce implementation.

Roadmap does not get implemented. Benefits not realized.

Private-public sector partnership towards implementation of e-commerce. Congressional Oversight on E-Commerce to monitor roadmap.

Private sector leadership proceed with roadmap implementation and pushing government to adhere to its commitment.

Private sector groups. Government agencies. Congressional Oversight on E-Commerce Law


Roadmap completion timeframe � TWG sign-up / Public document creation for

input elicitation: ¡  Citizen / Business Stakeholders - May 18 / June 1 ¡  Government Stakeholders - May 25 and June 8 ¡  Webinars for public consultation - May 22, May

29, June 4, June 11 ¡  E-Commerce Law anniversary - June 15. ¡  Davao (June 30), Cebu (July 6), Baguio (July 9)

� Stakeholder commitment support gathering (June 16 to July 15)

� Signing of Philippines E-Commerce Roadmap (July 16)

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For your inputs, contact � We need your inputs. Copy of Roadmap at

http://bit.ly/ecomroadmap � Submit your inputs to DTI E-Commerce Office

¡  [email protected] ¡  Call 02-9765703 ¡  Fax: 02-896-7889

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philippines e-commerce roadmap 2015 to 2020 - june 30 draft

Government & Nonprofit

authorized use

ecommerce roadmap

ecommerce concerns

ecommerce officedepartment

dti ecommerce office

bpm industry

business process outsourcing

philippines trust