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Kathmandu Sunday February 04, 2001 Magh 22, 2057.
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E-commerce in Nepal: Prospects and Problems
By Bal Bahadur Mukhia
The impact of technology on commerce, industry, finance, transportation,
communications, education, societies and so on has been felt in all most of the countries.
Electronic commerce is used as a broad term to mean a number of technologies and software
tools to help facilitate communication and trading by electronic means. Most people think
of e-commerce as an online shopping. E-commerce includes of business market space which
accounts for a significant amount of activity on the Internet. Electronic commerce is a
hot topic in just about every industry today. Whether in trying to reach consumers
directly or in trying to work with trading partners, there is something in e-commerce for
everyone. A great deal of technological progress of transportation and communication has
resulted in the globalization of trade and commerce. The Internet has come into existence
to promote emphatic transformation of the global society. All the countries throughout the
world cannot refrain from legislating the laws in acquiescence with modern technology. The
emerging world of electronic commerce has brought about most recent developments , as well
as new challenges to the existing laws that are based on traditional fashions. The
expansion of interest in electronic commerce has accentuated some avenues of law.
The most noteworthy revolution in technology has occurred in electronics, and
the law has to adapt to the new technological form. Now, many countries are facing the
problem of dealing with the cyber world, and the jurists have to shoulder the
responsibility for developing a comprehensive legal theory , including modern electronic
technology.
Millions of people are plugging in electronic networks which connects a
person's personal computer with any other computer in the world. Approximately, two
hundred million people have an access to the Internet, and the number of people using it
has been multiplying day by day. The Internet ( World Wide Web ) has imposed challenges on
the collective imagination of the business community. The giant company like MCI , which
was dominating the communication market, has merged with other global leaders to become
the MCI-World.com for its superior existence. But presently, AOL Time Warner is going to
be the premier global company, which is delivering the world’s most highly valuable
entertainment, news and the Internet identification rapidly to developing media platforms.
Liability concerns in e- commerce: In the present world of
high-teach development, there is the possibility of rapid and instantaneous transmission
of information across the globe. Information services are provided through a contractual
agreement, the potential liabilities are largely dependent upon the terms of the contract.
Contracts are legally enforceable agreements and liability for breach of contract is,
therefore, for the failure to keep to the terms of such an agreement. Contracts entered
into between information services providers and users, now, typically contain a whole host
of disclaimers. New technologies and their applications generally bring with them new ways
for public, private and commercial interests to interact and transact, which in turn
create opportunities to know their relative rights, responsibilities, obligations and
liabilities . Many laws may not be valid when considered in the light of technological
advancement. Multiple parties are involved in electronic commercial transactions, each of
which has separate sets of responsibilities, liabilities and rights. These parties include
(i) Value Added Network ( VAN) ( ii) Trading Partners (iii) Online Service Provider (OSP)
and (iv) Internet Service Provider ( ISP)
In all contracts, a signature can be the evidence of the party’s
identity, the party’s intention to be bound by the terms of the contract, and the
actual terms of the agreement. In certain digital transactions, an electronic signature
may be the only evidence, supporting enforceability. Under some laws, most legal
commentators believe that an electronic signature satisfies the signature requirements,
other laws are more ambiguous, and consequently create greater legal uncertainty.
Legal problems:The advent of the web has made it possible to
interact with computers as well as with institutions , business organizations and with
customers throughout the world. The web technology has opened the gateway to a virtually
boundless international market where territorial jurisdiction has become impertinent, and
because of this many legal issues are imminent. The openness of electronic transaction has
generated doubts and concerns over the security and privacy of business communications.
These concerns are bound to grow as the usage of the Internet accelerates, especially in
the new millennium. The Intellectual Property law has extended protection to computer
software, databases and new technological inventions, and protection against unfair
competition and so on. Novel problems have also cropped up regarding the intellectual
property rights over e-commerce. How can one charge for illegal and unauthorized copying
using the online access to resources? How can one know that plagiarism and illegal copying
has taken place? This puts copyright law right in the middle of cyberspace. In most
situations, sellers, buyers and consumers are based in different countries, and a single
law of a particular country can not be enough to deal with such e-commerce transactions.
In the case of violation of contract or unfair competition, it may be difficult to redress
the aggrieved party due to the lack jurisdictional provisions in the country.
Extra-jurisdictional authority may be required in such cases. Some related
international conventions, multilateral and bilateral treaties such as extradition
treaties, those related to telecommunications, the Convention on Agency in International
Sale of Goods and so on may be attracted to regulate the e-commerce transaction.
Misuse of the on-line is known as cyber crime, thus it is serious problem to
deal with. The " spoofing", " hacking" and attacking into the Internet
systems, andunleashing of unmanageable viruses are creating barriers to the smooth flow of
international business. It is learnt that enforcement and execution of orders and
judgement against the computer hackers, the Brussels and Lugano Conventions have provided
jurisdiction for their member countries. One of the most effective and promising methods
now available in the electronic world to ensure privacy and security of transactions is
the digital signature. It constitutes an identification mark, covering the entire document
and is, therefore, unique to every document. The creation and verification of digital
signatures is done by using a pair of private and public keys unique to an individual,
through a Public Infrastructure. It satisfies the criteria of authenticity, integrity and
non-repudiation. The problem is that electronic commerce on the Internet and other public
networks is intended to reach millions of users. How does a company offering goods and
services on the Internet make a contract with such users? Electronic delivery makes it
feasible to present the contract terms to the prospective user via screen text. However,
it is ambiguous to discern the exact legal problems in electronic commerce. Cyber space
law has not, so far, fully developed. Hence, there are still non-existent law making and
adjudicating bodies and law enforcing institutions. International effort is quite
constructive for the development of e-commerce. Prevalent Laws and practices in Nepal
Some of the countries have enacted laws dealing with the Internet and
e-commerce. The U.K. has the Computer Misuse Act 1990. In Canada, there is no legislation
dealing with the security and privacy aspects of electronic commerce.
However, in Nepal , there are not any laws dealing with e-commerce except for
the Electronic Transaction Draft Act 2057 B S which has yet to be passed by the
Parliament.
The Internet service was initiated by the Mercantile Communication Company in
1995. Now, the Internet service Providers must obtain license to provide the Internet
service. Some of the existing related laws in Nepal are the Copyright Act 1965, first
Amended in 1998 ( 2054 B.S.), Telecommunication Act 1997, Civil Code ( Muluki Ain ) 2020
B.S. ( 1964 ) Chapter four on Fraud, The Few Public Crime and Penalty Act 2027 B.S.( 1970
). These legal provisions are not adequate to encompass all problems related to e-commerce
in the present context of globalization trade and commerce.
Commercial and financial transactions have become convenient due the opening
of the Internet. It has made the transaction easier, faster and cheaper because of the
access to an online global market place which has represented a paperless world. Because
of the Internet accessibility and openness multiple problems have also cropped up for
lawyers and lawmakers particularly in a country like Nepal where there is a growing gap
between law and technology. The prevelant hi-tech and necessity for the technological
advancement in the country also demand for enacting appropriate and specific laws with a
view to covering the electronic commerce. It is, therefore, necessary to enact specific
statute to deal with electronic commerce. Courts also need to take cognizance of and
support electronic commerce transactions.
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