1 Brief Overview of Selective Legal and Regulatory Issues in Electronic Commerce United Nations Conference on Trade and Development Geneva, 14 June 2001 Dr. Carlos Moreno

2 Legal issues 4 Legal uncertainties 4Main commercial legal obstacle 4Basic legal infrastructure for building trust 4International solutions 4Policy considerations

3 Legal uncertainties I - Commercial law issues 4 writing 4 document 4 original 4 signature

4 Commercial law: Evidentiary value of data messages,storage of data messages, validity and formation of contracts, incorporation of general terms and conditions. Legal uncertainties

5 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

6 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....

7 Main legal obstacle Negotiability 4 Need for physical possession of original document. 4 Documents are negotiable: –common law(i) statute (ii) custom –civil lawopen system

8 How to establish a functional equivalent replicating the “uniqueness” of the document ? Contractual solution (Central Registry)

9 Electronic Signatures Functions 4Data origin authentication 4Message integrity 4Non-repudiation

10 Legislative Approaches 4Minimalist: removes legal obstacles to recognition/enforceability of e-signatures. 4Digital signature: establish legal framework for PKIs. 4Two-tier: standards for the operation of PKIs and broad view of e-signature.

11 Online Dispute Resolution (ODR) 4Online Settlement 4Online Arbitration 4Online Mediation 4Online Resolution of Consumer Complaints

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13 Legal solutions 4National legislation; 4International legal instruments; 4Contractual solutions; 4Self-regulation.

14 International solutions I - Model laws/guidelines UNCITRAL Model Law on Electronic Commerce UNCITRAL Uniform Rules on Electronic Signatures EU Directives on Electronic Commerce

15 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).

16 International solutions II - Contractual approaches European Model EDI Agreement ECE Model Interchange Agreement ECE Electronic Commerce Agreement

17 Problems encountered by contractual solutions (i)Obligations arising from mandatory legislation. (ii)Rights and obligations of third parties. (iii)Communication in an open network.

18 III - Code of Conduct - Self regulation International solutions OECD work UN/CEFACT Model IV - International Convention ?

19 Policy Considerations 4There is a need for a favourable legal environment to accommodate e-commerce; 4Governments should not over-regulate; 4Legislation adopted should be technology- neutral; 4Party autonomy should be preserved.