E-commerce gains legal frame
Electronic commerce in Hong Kong is due to receive a boost with the Government finally drawing up and submitting guidelines for the Electronic Transactions Bill.
This is a legal framework to give electronic records and digital signatures used in electronic transactions the same legal status as that of their paper-based counterparts and will be introduced into the Legislative Council tomorrow. Government officials are hoping that the bill will be passed by the year's end.
'The Electronic Transactions Bill when finally passed will be a real boost to doing e-commerce in Hong Kong,' said Mr Yuk Wai-fung, director of Electronic Services at the Hongkong Post. Hongkong Post is the SAR's first Certification Authority.
'The local banks have been hesitant about e-commerce so far because they are worried about security and the consequent high risk of fraud. With Hongkong Post's Public Key Infrastructure running at the end of this year and the Electronic Transactions Bill passed later this year also, the local banks be a lot happier with the e-commerce environment,' he said.
Joe Sweeney, analyst at market research group The Gartner Group, agrees.
'What Hong Kong lacks [in promoting e-commerce] is law - the right regulations to ensure a secure environment for e-commerce to take place,' he said.
If the Bill is passed and Hongkong Post's PKI is up and running, Hong Kong would have a sound and secure on-line environment in which merchants and banks can trade by the end of the year, he said.
Banks have been hesitant to implement e-commerce because of the perceived risks of credit card fraud.
With the Electronic Transactions Bill and the PKI, these risks are seen to be reduced because a system and legal framework will be in place to check the authenticity of the identities of the parties involved in a transaction as well as the integrity of that transaction.
Does this mean that the banks are more willing to support on-line merchants? Chekiang Bank and Hongkong Shanghai Bank claimed that they already were allowing Internet merchants to have accounts and process on-line credit card transactions for them.
However, according to at least one Net entrepreneur, the banks continue to grant them an account only if their shop possesses a physical location.
'The banks are a long way from supporting on-line retailers unless you are big like Giordano or Maxims,' he said.
