The European Commission has adopted draft legislation to regulate the exploding ecommerce market.
The proposed legislation, which covers the sale of products and services via the Web, as well as advertising, direct marketing, online newspapers and entertainment sites, essentially puts the burden of responsibility on national consumer laws in each member state.
However, certain areas would be standardised across the 15-country community, namely giving the location and business of a company via its fixed location. This would make online contracts as legally valid as paper ones, including the liability of intermediaries, settling legal complains and the role of national authorities.
Intermediaries who transmit and store data will be exempt from liability if their role is a passive one in simply transporting information. In addition member states would only be allowed to block an Internet service from another country to protect public interest. The Commission would, however, have the final decision.
To protect consumers from ?harmful intrusion? the proposal requires communications by email be clearly definable.
Finally the Commission plans to give individual countries control over Internet businesses operating out of its territories. This is a hughely contentious point and one that is likely to cause clashes. Consumer organisations want the legal system in the country where the consumer is living to deal with any cases that arise. However ecommerce business groups want complaints dealt with in the country in which the ecommerce company is based.
The Commission said that regulation is necessary to increase Europe?s slice of the ecommerce market, which is heavily dominated by the US, by increasing customer confidence and giving operators legal certainty.
The Commission estimates that ecommerce could be worth $240 billion by 2000, when the number of people connected to the Internet will rocket from the current estimated 86 million to 250 million.
The draft also asks member states to obligate providers to give customers clear and basic information on their activities, including their name, address, email, trade register numbers and VAT number.
Nothing, however, is yet written in stone. The proposals will now have to be approved by the Council of Ministers before becoming law. In this process they could face substantial amendment by the European Parliament.
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