Tuesday, 12 July 2011

Issues Concerning E-Commerce

The Copyright of this Article rests with the writer Mr. Vinod Khurana, President IFAIA

Information technology is no longer intersecting with business, but has become an integral part of our economy. However, as it stands electronic commerce per se is not part of WTO agreements. The United Nations Commission on International Trade Law adopted the model Law on electronic commerce in 1996, keeping that in mind the Indian Parliament has put in force Information Technology Act 2000.The salient features of this Act are the use and acceptance of electronic records and digital signature in Government offices and its agencies, thus bringing consequential changes in the Indian Penal Code, The Indian Evidence Act 1872, and to give legal sanctity for books of accounts maintained in the electronic form.

  • Cyber Law

  •  Intellectual Property issues in cyberspace

  • Commercial issues in cyberspace

  • Global issues in cyberspace
    Cyber Law:
    Many legal issues arise while doing commerce on Internet which needs to be understood e.g. how far the web contents is protected by copyright law, how effective are the copyright in the present scenario when they become accessible globally, how the privacy and security can be maintained, what Constitutes defamation on the Internet, as the electronic commerce has no geographical boundary. We must be clear as to the repercussion and possibility of defending a lawsuit, in any country where end user resides.

    Intellectual Property:
    Trademarks, Copyrights and Patents are the most common intellectual property issues affecting the cyberspace. A trademark as defined under trademark act 1999 means a mark capable of being represented graphically and which is capable of distinguishing the goods or services of one person from those of others and may include shape of goods, their packaging and Combination of colours; - trademark can be broadly classified as generic, descriptive, suggestive, arbitrary, fanciful, and the protection would depend on the category in which it falls. It is important that on line company register its trademark besides a distinctive domain name and must be clear with difference of trademark/service mark and a particular dot.com domain name.
    Registering a trademark/service mark, trade dress as distinctive, it's infringement and delusion, it's international protection and the jurisdiction are the important issues that the domain name and the companies on line have to be aware of.
    Copyright is another issue that affects e-commerce. Are you aware what kind of legal recourse do you have if another e- business is using your on line material or could you be liable for infringement, if your website is linked to an e-business that displays copyrighted material without the owner's consent. Never before it has been so easy to violate a copyright owner's exclusive right, as it is now, therefore it is essential to understand as to how e-business can legally protect copyright ownership, what are the requirements for registration in copyright office, what are his exclusive rights, what are remedies and liabilities for copyright infringement what are the Patent able subject matter related to software in view of new patent act and what are it's advantages.

    Commercial Issues in Cyberspace:
    E-commerce involves various issues such as, on line contracting, payment procedure, and taxation, among others. A contract is an agreement to exchange property or service that is legally enforceable in the court of law, we also know that a contract law is a matter of both common law and statutory law enacted by each country and may vary in various requirements, which are essential. To enter into valid and enforceable contract such as Mutual Assent, Consideration, Capacity, Legality and Forms, validity of such requirement for business or internet or e-commerce may involve various legal issue e.g. a person under intoxication is incompetent and lacks contractual capacity, what happens if a person under intoxicated condition formalizes a contract on e-commerce, therefore the companies need to understand such delicate issue to equip themselves for such eventualities as a precautionary measure. As regards taxation some intricate issues may arise such as sales tax charge. Sales tax is a state subject and paid by the consumer at the point of purchase, how would that be implemented in e-commerce scenario, sales tax is charged on sale of tangible assets software on disk in a state may subject the vendor for collecting the sales tax, what happens when a company sells software on line through credit card without knowing the physical presence. The problems are more complex when you have international transaction and needs to be understood by the companies doing e- business.
    The Internet was developed with free and open communication rather than security in mind, as the business is migrated to the internet to address the above questions are out of necessity more so when the users are generally novices, the urgency needs to be understood from the very fact that the expected turnover on e- commerce for the year 2003 is three trillion dollars.
    The purpose of this letter is only to create awareness among the e- traders that much needs to be done and understood to protect one's business, which otherwise can be in jeopardy. If you have any question please do not hesitate to refer them to us at ifaia@ifaia.org.com