Forward, not backward

Marvin A. Tort

Posted on August 10, 2017

It is timely for Congress to now amend the e-commerce law enacted 17 years ago.

It was in June 2000 that President Estrada signed into law Republic Act 8792 or an “Act Providing For The Recognition And Use of Electronic Commercial And Non-Commercial Transactions, Penalties For Unlawful Use Thereof, And Other Purposes, also known as the “Electronic Commerce Act.”

Since then, much has changed by way of technology, mobility, bandwidth, and Internet connection. And these changes paved the way for the emergence of what is now known as the “sharing economy,” where people with excess capacity -- in terms of properties or vehicles, among others -- use various platforms to let others temporarily utilize their surplus.

Uber, Grab, AirBnB,and other online or mobile platforms, as well as a government agency like the Department of Information and Communication Technology (DICT), were all nonexistent when RA 8792 was authored almost two decades ago by then Senator Ramon Magsaysay, Jr., and then Congressmen Leandro Verceles, Jr. and Marcial Punzalan, Jr.

RA 8792 was forward-looking then, and had obviously aimed to prepare the country for business, trade, and commerce for the 21st century. But, 17 years hence, and with the Philippines now grappling with issues involving transportation networks like Grab and Uber, the law does not seem to be as relevant. In fact, it seems outdated at this point.

In particular, the law must be made timely with respect to providing the proper legal framework for all businesses done online or through mobile platforms or other electronic modes. Moreover, it should be amended to provide for stronger consumer protection. And, just as important, it should consider a suitable framework for regulation and taxation.

It should take into account present-day realities, but at the same time be cognizant of what may transpire or occur in the near and distant future. In this line, perhaps it should be reviewed and assessed every six years, and harmonized with any existing or future laws involving a national ID system, and electronic banking and trading.

Technology has made big leaps in the last two decades, with expansion of various electronic channels for trade and financial transactions. Even broadcast has moved to the digital space, and there has been improved access to satellite technology. Homes are now turning to online entertainment, slowly but surely moving away for regular or standard cable or free TV.

Even music has moved towards digital, with online streaming and storage rather than regular compact discs, becoming the default. Homes and offices have also become less “wired” and more mobile with more workers on mobile data plans. Bluetooth and Wi-Fi has become the default connections rather than “wire” or cable, and most everything is available as a “download.”

Only food and clothing and other basic necessities, including consumer durables like electric appliances and motor vehicles, have more or less remained “standard,” but price and buying and access points have shifted towards what can be “ordered” online or through mobile, like transport from Uber or Grab, or lodging from Air BnB.

Navigation has also moved towards electronic, with city and street maps no longer in fashion as most everybody can access Google Maps or Google Earth. Online libraries and other resource centers are the primary source of information for many, including Google, and even schoolchildren now need online connection at home for study, tests, projects, or assignments.

Amidst all this, there doesn’t seem to be a strong legal basis, an underlying law, that encompasses or governs anything and everything happening online. Perhaps that’s the way it should be, really. But with respect to “doing business” online or electronically, I am inclined to believe that some framework for regulation should exist.

The e-commerce law of 17 years ago no longer meets that need, in my opinion. And this is where “crowdsourcing” of ideas should come in, with lawmakers freely consulting legal and IT experts as well businessmen and consumers, to address the need for a “futuristic” legislation for e-commerce that understands what is, and considers what can be.

Otherwise, we will always find ourselves in the Grab-Uber situation, where regulators may be hard-pressed to fit technology-based business to existing molds that may or may not be suitable or applicable. And this, primarily for want of a more appropriate or applicable legislation to serve as legal basis, and from which a suitable regulatory framework can be drafted and applied.

The shift to e-commerce is inevitable, and what we see now is just the start.

Uber, Grab, AirBnB, and Amazon are just the start. Even present-day mobile technology still has plenty of room to grow. What may have seemed impossible 20 years ago is now here, and we should be ready to adapt to these changes.

Understandably, legislators have no crystal balls to gaze upon. They are not seers who can see into the future. But, by consulting people in the know, or who have a better appreciation of what to expect 10-20 years from now, they can better understand potential needs. Forecasting, in this sense, is primarily guesswork.

From experience, we know that the law almost always plays catch-up to technology. But while this may be the case, the gap shouldn’t always be too big. Or, at the very least, the law should be made flexible to anticipate technological advances in the future. Considering changes to the e-commerce law now is a step in the right direction.

Marvin A. Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippines Press Council.