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Saturday, May 12, 2012

Ecommerce - Two Sides - Education

There are several problems with e-commerce development. Number one problem is the complexity of export control. In this article I will discuss strengths and weaknesses of the e-commerce.

Briefly, the significant bulk of western scholarship and statements by international organisations, extol the virtues of e-commerce due to the nature of its medium, and argue that open international market access is the key to realising its global benefits. The key feature of cyberspace is that it "places each and every user in a single global market place" and "makes it easier for business to surmount barriers traditionally created by national borders." This is especially true in the sale and purchase of digital products, where there is no physical handling of the good in question. Whilst some scholars argue that attempting to regulate the use of the technology involved in facilitating trade over cyberspace is pointless, as the rules of the transaction are determined by the technology in question there is still a need, from society's perspective to regulate transactions in spite of the medium, for traditional reasons in the traditional market place - certainty, predictabi lity and knowing "the field" in which one engages. As e-commerce continues to expand globally, there are is greater awareness for the realisation of two interconnected requirements for trade:

* the easier distribution of the facilitative means by which trade can be conducted over cyberspace

* the harmonisation of international laws to ensure all market players have an equal understanding and expectation of their rights and obligations in relation to conducting trade in cyberspace.

Thus, it is important to identify some of the general problems the international community faces when seeking to adopt a uniform approach towards e-commerce and examine how international trade regimes such as the WTO can initiate or assist in bringing about some form of harmonisation in this rapidly growing and changing area.

A fundamental problem in creating and implementing an international trade regime on e-commerce involves finding an internationally acceptable and working definition of 'e-commerce.' Only once a uniform definition is established, can the volume of e-commerce, as a part of international trade, be properly measured.

A business to consumer (B2C) or business to business (B2B) transaction over the internet may involve the placement of an order and making the payment (via credit card or online checking system). If the product ordered can be delivered physically, then ordinary tariffs may apply (depending on the product) and national policies on the imposition of tariffs or quotas on that product, will be addressed by GATT or the other WTO Agreements. However if the transaction involves the "importation" of the product electronically then governments will be concerned about potential loss of revenues or potential damage to local industries, because these products are no longer physically imported and hence would not attract tariffs that may ordinarily apply. A working paper commissioned by the WTO analysing the future impact of the growth of e-commerce as a significant means of trade, noted in relation to 'digitizable products' that "significantly lower prices offered through the web shoul d have a strong impact on the physical trade in these highly substitutable products." Again, this is of greater concern to developing countries, where only a limited proportion of the population may have access to e-commerce facilities.

Another issue that the WTO faces is determining whether or not electronic products can be classified as either "goods" or "services" for the purposes of applying the provisions of GATT or the General Agreement on Trade in Services (GATS). Currently, the WTO General Council uses a working definition of e-commerce that defines the concept as "the production, distribution, marketing, sale or delivery of goods and services by electronic means.

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