Module 4: Other key issues to be addressed in creating an enabling legal and regulatory framework to encourage internet use for business development

Summary: module 4 in a nutshell

Promoting Competition

The elimination of barriers to entry, and the introduction of competition in the ICT sector will generally provide benefits not only to ICT-related SMEs, but to all SMEs in general.

Bridging the Digital Divide

The digital divide refers to the gap between those with regular, effective access to digital technologies and those without. The digital divide results from the socio-economic differences between communities that in turn affect their access to digital information – mainly but not exclusively through the internet.

The digital divide is an example of a problem that likely requires more from the government than from the private sector.

Bridging the digital divide is an important policy goal to the extent that it assists SMEs in remote and unserved areas to grow and contribute more meaningfully to overall countryside development.

Consumer Protection

The primary concerns for the consumer, which would need to be addressed by SMEs and by the broader legal and policy framework, include the following:

• Consumer’s exposure to unfair marketing practices;
• Insufficient information disclosure, for example, refund policies, cancellation terms, warranty information;
• Contract terms, for example, their enforceability;
• Merchandise and delivery practices, for example, failure to perform and lateness;
• Payment, for example, recovering fraudulent charges if credit card information falls into criminal hands;
• Transaction confirmation and cancellation policies, for example, consumer’s lack of knowledge on cancellation rights for online transactions, including for mistakenly made purchases;
• Fraud and deception, for example, lack means to authenticate merchandise purchased online;
• Unsafe products;
• Insecure payment methods;
• Loss of personal privacy and protection of confidential data;
• Risk misuse of personal information;
• Other concerns include computer fraud, hacking, virus, interception and alteration of financial data and misuse of personal information.

General principles for protecting consumers online:

• Transparent and effective protection;
• Fair business, advertising and marketing practices;
• Online disclosures;
• Confirmation process;
• Payment;
• Dispute resolution;
• Privacy;
• Education and awareness.

Privacy

Countries that wish to participate in the global information economy will increasingly need to consider laws that protect personal data to compete.

The European Union’s Data Protection Directive, enacted in 1995, requires member states to ensure that the transfer of personal data to non-European Union countries takes place only if the latter country provides an adequate level of privacy protection.

The OECD privacy guidelines feature eight privacy principles:

• Collection limitation principle;
• Data quality principle;
• Purposespecification principle;
• Use limitation principle;
• Security safeguards principle;
• Openness principle;
• Individual participation principle;
• Accountability principle.

Intellectual Property Rights

New ICTs are challenging the intellectual property system in ways that may only be resolvable with substantial changes in the system or with new mechanisms to allocate both rights and rewards. New ICTs, for example, create problems in certain areas:

• Identifying authorship;
• Identifying infringements and enforcing rights;
• Private use;
• Derivative use;
• Meeting educational goals;
• Integrity.

Cross-border Cooperation and Harmonization

Different countries have different approaches to the challenge of policymaking. Given the borderless nature of the Internet, conflicting rules and regulations only serve to hamper and discourage participation in e-commerce, especially by SMEs.

Additional information on other key issues to be addressed in creating an enabling legal and regulatory framework to encourage internet use for business development

Asia-Pacific Development Information Programme

Provides various resources on e-governance, ICT4D, ICT for SMEs, open source software, policy notes on ICT for SMEs. http://www.apdip.net/

Cyber Security and Cyber Crime

Information on news, cyber laws, cyber alert systems, vulnerability resources, attacks, policies, laws and statistics. Available online in the following websites: http://www.us-cert.gov/, http://www.staysafeonline.info/, https://www.csialliance.org/home/, http://www.cpi.seas.gwu.edu/, http://www.cyberpartnership.org/

Development Gateway (World Bank) portal

The website includes a wide variety of documents on ICT and development; e-commerce and development; e-commerce and arts and crafts; among others. http://www.developmentgateway.org/all-topics

Digital Dividend portal

A site offering innovative examples of SMEs using e-business techniques. The site also offers a clearinghouse to match investors/sponsors with prospective projects. http://www.digitaldividend.org/

Network World.

Provides information on VoIP and convergence, network security and solutions, SME networking, and white papers on convergence and internet policies. www.networkworld.com

Networkworld Partners

Includes solutions and alternatives on VoIP technology. www.networkworldpartners.com

OECD SME portal

Promotes entrepreneurship and advance the performance of small businesses by evaluating and diffusing best practice policies in SME development. http://www.oecd.org/department/

SME portal in Malaysia

A one stop information portal for small and medium-sized enterprises. It provides information on all aspects of SME development, including financing, advisory services, training programmes, business and networking opportunities. www.smeinfo.com.my

Technonet Asia

A cooperative network of development support institutions, aiming to enhance the quality and competitiveness of SMEs in its member countries through information, technology transfer and human resources development. http://www.idrc.ca