Brief Overview of Selective

Legal and Regulatory Issues in

Electronic Commerce

Geneva, 14 June 2001

Dr. Carlos Moreno

United Nations Conference on Trade and Development

1
 Legal issues

 Legal uncertainties
Main commercial legal obstacle
Basic legal infrastructure for building trust
International solutions
Policy considerations

2
 Legal uncertainties
I - Commercial law issues

 writing

 document

 original

 signature
3
 Legal uncertainties

Commercial law: Evidentiary value of data

messages,storage of data messages, validity
and formation of contracts, incorporation
of general terms and conditions.

4
 Legal uncertainties

II - Intellectual property issues

WIPO Treaties and Domain Names

III - Consumer protection

OECD Guidelines

IV - Authentication and security

Electronic signatures legislation

V - Jurisdiction and applicable law

ADR/ODR Mechanisms 5
 Legal uncertainties

VI - Taxation
WTO standstill on customs duties on
e-transmissions.

VII - Internet content regulation

EU Commerce Directive (ISPs)
VIII - Computer crime
Criminal legislation.
IX - Data privacy
OECD Guidelines, Council of Europe Conv.
EU Directive, US legislation... .
6
 Main legal obstacle

Negotiability
 Need for physical possession of
original document.

 Documents are negotiable:

– common law (i) statute
(ii) custom

– civil law open system

7
How to establish a functional equivalent
replicating the “uniqueness”
of the document ?

Contractual solution
(Central Registry)

8
 Electronic Signatures
Functions

Data origin authentication

Message integrity

Non-repudiation

9
 Legislative Approaches

Minimalist: removes legal obstacles to

recognition/enforceability of e-signatures.

Digital signature: establish legal

framework for PKIs.

Two-tier: standards for the operation of

PKIs and broad view of e-signature.
10
 Online Dispute Resolution
(ODR)

Online Settlement

Online Arbitration

Online Mediation

Online Resolution of Consumer Complaints

11
 Main ADR Forms and Processes

Corporate Assisted
Complaint Negotiation Mediation Arbitration Litigation
Services

On a Sliding Scale:

Facilitation Automated, or not Voluntary or mandatory

Conciliation submission
More or less active
guidance by the neutral Automated or not

Voluntary or mandatory Final and binding

participation

No obligation on the
parties to agree, before
entering ADR, that the
outcome will be binding


Informal to Formal ADR

Source: "Building Trust in the Online Environment: B2C Dispute Resolution". Joint Conference
of the OECD, HCOPIL, and ICC. The Hague, 11-12 December 2000. Orientation
Document.

12
 Legal solutions

National legislation;

International legal instruments;

Contractual solutions;

Self-regulation.
13
 International solutions
I - Model laws/guidelines
 UNCITRAL Model Law on
Electronic Commerce

 UNCITRAL Uniform Rules on

Electronic Signatures

 EU Directives on Electronic Commerce

14
 But…...

UNCITRAL Model Law might

not be sufficient to overcome
legal obstacles arising from
mandatory international
conventions.
(Vienna Convention on the
Law of Treaties, 1969).
15
 International solutions
II - Contractual approaches

 European Model EDI Agreement

 ECE Model Interchange Agreement

 ECE Electronic Commerce Agreement

16
 Problems encountered by
contractual solutions
(i) Obligations arising from mandatory
legislation.

(ii) Rights and obligations of third parties.

(iii) Communication in an open network.

17
 International solutions

III - Code of Conduct - Self regulation

 OECD work

UN/CEFACT Model

IV - International Convention ?

18
 Policy Considerations

There is a need for a favourable legal

environment to accommodate e-commerce;
Governments should not over-regulate;
Legislation adopted should be technology-
neutral;
Party autonomy should be preserved.

19