After reading this article you will learn about the guiding principles for the introduction and growth of electronic commerce.
1. The private sector should lead:
Though governments played a role in financing the initial development of the Internet, its expansion has been driven primarily by the private sector. For electronic commerce to flourish, the private sector must continue to lead. Innovation, expanded services, broader participation, and lower prices will arise in a market-driven arena, not in an environment that operates as a regulated industry.
Accordingly, governments should encourage industry self- regulation wherever appropriate and support the efforts of private sector organizations to develop mechanisms to facilitate the successful operation of the Internet.
Even where collective agreements or standards are necessary, private entities should, where possible, take the lead in organizing them. Where government action or intergovernmental agreements are necessary, on taxation for example, private sector participation should be a formal part of the policy making process.
2. Governments should avoid undue restrictions on electronic commerce:
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Parties should be able to enter into legitimate agreements to buy and sell products and services across the Internet with minimal government involvement or intervention. Unnecessary regulation of commercial activities will distort development of the electronic marketplace by decreasing the supply and raising the cost of products and services for consumers the world over.
Business models must evolve rapidly to keep pace with the break-neck speed of change in the technology; government attempts to regulate are likely to be outmoded by the time they are finally enacted, especially to the extent such regulations are technology-specific.
Accordingly, governments should refrain from imposing new and unnecessary regulations, bureaucratic procedures, or taxes and tariffs on commercial activities that take place via the Internet.
3. Where governmental involvement is needed:
Its aim should be to support and enforce a predictable, minimalist, consistent and simple legal environment for commerce: In some areas, government agreements may prove necessary to facilitate electronic commerce and protect consumers.
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In these cases, governments should establish a predictable and simple legal environment based on a decentralized, contractual model of law rather than one based on top-down regulation.
Where government intervention is necessary to facilitate electronic commerce, its goal should be to ensure competition, protect intellectual property and privacy, prevent fraud, foster transparency, support commercial transactions, and facilitate dispute resolution.
4. Governments should recognize the unique qualities of the Internet:
The genius and explosive success of the Internet can be attributed in part to its decentralized nature and to its tradition of bottom-up governance.
These same characteristics pose significant logistical and technological challenges to existing regulatory models, and governments should tailor their policies accordingly. Electronic commerce faces significant challenges where it intersects with existing regulatory schemes.
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We should not assume, for example, that the regulatory frameworks established over the past sixty years for telecommunications, radio and television will fit the Internet. Regulation should be imposed only as a necessary means to achieve an important goal on which there is a broad consensus.
Existing laws and regulations that may hinder electronic commerce should be reviewed and revised or eliminated to reflect the needs of the new electronic age.
5. Electronic Commerce over the Internet should be facilitated on a global basis:
The Internet is emerging as a global marketplace. The legal framework supporting commercial transactions on the Internet should be governed by consistent principles across state, national, and international borders that lead to predictable results regardless of the jurisdiction in which a particular buyer or seller resides.