Southeast Asian States Move To Harmonise Their E-Commerce Laws

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Cebu City, Philippines – The 10 member states of the Association of Southeast Asian Nations (ASEAN) met over the weekend to advance the groundwork for what is perceived as a challenging but progressing task of harmonising their e-commerce laws, ahead of the region’s nearing deadline of creating an integrated economy by 2015. In three years’ time, the 10 Southeast Asian countries of Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam target the setting up of a functional ASEAN Economic Community (AEC). This is to result in the free movement of goods, services, investment, labor and capital across the region.

Electronic commerce is seen as a key component for the ASEAN to realise its vision of having an integrated economy. Having a single market will enable ASEAN member states to, among other things, take advantage of the rapid economic development within the region and in other neigbouring Asian countries. Intellectual property is also seen as playing a role in harmonising e-commerce, especially at this time of unabated shift of global business to the online economy.

A two-day workshop, a first of its kind, was held here to review and make proposals for ASEAN member states to consider in finalising measures aimed at harmonising their e-commerce laws. The workshop was facilitated by the United Nations Conference on Trade and Development (UNCTAD), a UN body whose aim is to promote the integration of developing countries into the world economy.

At the workshop, trends, challenges and opportunities in harmonising the e-commerce laws within the ASEAN region were identified and with countries making individual reports on their progress, issues, challenges and legal priorities in enforcing, and for some countries that are still lagging behind, in drafting their e-commerce regulations.

The closed-door workshop was attended by representatives from all 10 member states, some officials from the ASEAN Secretariat and UNCTAD, and some experts tapped to review and facilitate the discussions on harmonisation of e-commerce laws in the region.

Torbjörn Fredriksson, chief of the ICT Analysis Section at UNCTAD, said the ASEAN e-commerce harmonisation holds a particular importance as the region pioneered a decade ago the adoption of a harmonised legal framework for e-commerce in the developing world.

“What is going on on here is not only for the ASEAN, but also for countries in other parts of the world to learn from this,” Fredriksson told Intellectual Property Watch in an interview. UNCTAD facilitated similar efforts in Latin America and in the East African Community.

The ASEAN, as it stands now, is a mixed bag of already relatively wealthy member states in Singapore and the oil-rich Brunei, populous and developing economies like the Philippines and Indonesia, and least developed economies like Laos.

Budi Yuwono, senior officer for the ICT sector at the ASEAN Secretariat, said in an interview that this early it is difficult to give specific targets for the e-commerce harmonisation when asked on the timetable. While some progress has been made, some hurdles are also inevitable. “It has been a learning process for most of us,” Yuwono said.

Priority Areas For Harmonisation

In the run-up to the workshop, the ASEAN and UNCTAD conducted in October two surveys on the “existing legal frameworks for e-commerce activities” of both governments and the private sector in ASEAN countries, according to a release from UNCTAD.

The results from the surveys were used during the workshop to identify specific areas for discussion among member states and to single out key drivers and challenges in harmonising e-commerce regulations in the region, said Cécile Barayre- El Shami, UNCTAD program manager for e-commerce and law reform.

Chris Connolly, UNCTAD consultant and director of Galexia Consulting, told Intellectual Property Watch that at least three priority areas were identified for ASEAN member states to consider in their push to arrive at a common e-commerce regulations. These are electronic transaction laws, cybercrime laws and privacy and data protection laws.

In the area of electronic transactions, except for Laos and Cambodia, the remaining eight ASEAN member states already have electronic transaction regulations.

“Back in 2004, less than half of the countries had electronic transaction laws in place. And the two remaining countries both had draft laws. Eight out of ten is [a] good [number] and this gives us confidence that we are very close to achieving that 2015 goal,” Connolly said.

On the other hand, progress has been slower in the two priority areas of cybercrime law and privacy law. Tentative results of the survey showed that of the 10 ASEAN member states, Cambodia, Laos and Malaysia do not have cybercrime regulations, while only Malaysia, Singapore and the Philippines have existing privacy laws, an observer said. [modified]

Regulating cybercrime, with its internet intermediary component, and privacy and data protection, are both touchy areas under e-commerce.

A case in point is the Philippines, which recently enacted a cybercrime law, a move not welcomed by many stakeholders due to what it seen as last-minute inclusion of a provision against libel and what is alleged as a lack of enough immunity provisions for service providers.

Other areas being examined to harmonise the region’s e-commerce laws are consumer protection, competition, online dispute resolution, to include domain names resolution, and online content regulation. Online dispute resolution and online content regulation are two areas closely related with intellectual property rights protection. UNCTAD said the two areas are slated for discussion under Framework II, referring to the subsequent stage. “The next phase is going to be after UNCTAD publishes the result of their study in April 2013,” Yuwono said.

ASEAN has a Working Group on Intellectual Property Cooperation which has acted as a consultative body for regional cooperation on IP since 1996.

Challenges Now and Ahead

In any harmonisation efforts, the gap between and among participating countries, particularly economic differences, is seen as a big challenge, and this also proves true in harmonising the e-commerce laws in the ASEAN region.

“The issue is not every country has a good awareness or level of importance when it comes to e-commerce. Some countries have a very strong commitment to internet penetration and with e-commerce very high in their agenda. In other countries, however, it is not a priority,” Connolly said.

From the survey results, a mammoth barrier to harmonisation is in the area of capacity building. “You can imagine that in some countries, the minute you get skills in e-commerce, you tend to get headhunted by the private sector so the number of people [in government] who have good knowledge is quite limited,” Connolly said.

Particularly, UNCTAD has extended support to the governments of Cambodia and Laos in building capacity and preparing their e-commerce laws.

In addition, there is the issue of funding for the enforcement of regulations. “You can put the laws on the book, but nothing will happen unless you have a regulator that will enforce it. Privacy law, for example, always requires a data protection commission and that is expensive,” Connolly said.

In a region as diverse as Southeast Asia, where dominant religious beliefs vary from one country to another and from one group to another, even religion, which can influence the type of data allowed for use in commerce, could be an issue in the harmonisation efforts, said Yuwono.

“This will have to be looked upon by regulators when people are selling digital content like movies,” he said.

No Single, Binding E-Commerce Law

With the regional bloc still refining the details of the harmonisation, what is obvious now is the strong probability of having no single, binding and from scratch or original regional e-commerce regulations.

“It is not going to be one binding law for the whole ASEAN. There may be differences,” Yuwono said, noting that what the ASEAN harmonisation wants to achieve is to have “predictability” in the use of e-commerce within the region, particularly for the benefit of the business sector.

Connolly said the exact ASEAN method of e-commerce harmonisation could “be discussed over the years.” Harmonisation models being looked into can include harmonisation through a directive, similar to that of the European Union. Under EU laws, a directive “lays down certain end results that must be achieved in every member state,” but still gives each member state the “freedom in deciding how to do so.”

“Rather [than] ASEAN developing its own models from scratch, the countries in general agreed that they should look at international best practices rather than developing their own as it is impossible for the ASEAN to go down that path,” Connolly said.

He added that mechanisms could also be in the form of bilateral assistance and not only through regional assistance. “In the past, Malaysia, for example, invited people from Myanmar to come to Malaysia and to work with the regulators there for a few months and then they go back.”

Aside from this, Yuwono said harmonisation could also start from technical collaboration. “Sometimes, it doesn’t need to start with having the legal foundation, but it can start with the technical foundation. We have some technical working groups that discuss part of those legal areas,” he said.

With only three years left before the 2015 economic integration deadline, one sure thing is that the e-commerce harmonisation efforts in the ASEAN region will continue even after the 2015 target. “This is an on-going process, you will never finish, especially in the area of ICT where everything is changing – there are new technologies, there are new applications,” Fredriksson said.

Next Steps

The recommendations from the workshop will be presented to the 13th ASEAN Telecommunications and IT Senior Officials Meetings (Telsom) on Tuesday. The output from the workshop will also serve as an input to the UNCTAD’s Review of E-Commerce Laws Harmonization in ASEAN set for publication in 2013.

Aside from Telsom, the Philippines is also the host to the 12th ASEAN Telecommunications and IT Ministers Meeting (Telmin), all happening this week here in Cebu, one of Philippines’ most developed provinces.

According to a release posted on the official government news website of the Philippines, two highlights of the week-long ASEAN conference are the signing of the Mactan Cebu Declaration and the first ASEAN ICT Awards.

The release read that the declaration “aims to improve cooperation between ASEAN member states in ICT-related endeavors such as cybersecurity, e-commerce and implementation of strategic thrusts in the ASEAN ICT Masterplan.

The ASEAN ICT Awards will be given to organisations “that have shown outstanding ICT products/services and/or most respected business accolade in the ASEAN ICT industry.” Categories are public sector, private sector, corporate social responsibility, digital content and start-up companies.

 

Maricel Estavillo may be reached at maricelestavillo@gmail.com.

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