Europe Struggles To Standardize E-Commerce Laws

European Commission ministers met in Belgium Friday in an attempt to agree upon a regulatory framework for electronic commerce from country to country.

The Commission, which acts as the European Union’s executive body, addressed the fact that many countries have individual laws pertaining to e-commerce that are not necessarily compatible with international trade.

Consensus, while not imminent, may be critical in the near future, since this year’s $18 billion (US$) in e-commerce revenues promises to swell to $350 billion by 2003.

Streamlining For The Future

Multiple concerns have arisen among the participating countries. For example, if a British-based Web company opens a pan-European Web site, it must conform to defamation, advertising and unfair competition laws in other European member countries.

Some companies have chosen not to participate in e-commerce rather than wrestle with conflicting laws from one country to another.

In fact, some of the ministers expressed concern that while e-commerce appears to hold great promise for all of the countries involved, failure to reach agreement on terms could inhibit its growth.

Hans Werner Muller, secretary-general of the European small and medium-sized business association, expressed a sense of urgency for some resolution to the problem.

“We vehemently believe that regulation should not prevent SMEs from exploiting the cross-border business opportunities that are offered by electronic commerce,” he told the Financial Times. “The lost employment opportunities would be immense.”

Some of the ministers at the Brussels meeting expressed concern that even if the Commission develops guidelines and regulations, some individual countries will still impose their own national restrictions — essentially rendering the agreement meaningless, and thereby stalling e-commerce growth. Germany, for example, has already stated its demand to impose its own competition law on the proposed European-wide directive.

Some of the key issues under discussion include liability concerns, clauses removing barriers to electronic contracts and requirements placed against online traders to indicate where they are physically based.

The Runaway Train

Meanwhile, e-commerce continues to outrun its opponents, despite their disagreements. The meeting in Belgium comes right on the heels of last week’s news that one in four UK adults now uses the Internet on a regular basis.

Results of the Nielsen Research survey indicate that 27 percent of the respondents have purchased goods online, and 49 percent have used the Internet to compare the price of goods and services.

The ministers representing their various constituencies may well find themselves forced to respond to a clear public mandate if these numbers continue to hold up.

As Europeans try to hammer out an agreement, the U.S. retains its formidable lead in the world of e-commerce, with revenues of approximately $507 billion, according to research results released this week by Cisco Systems.