The Legal Barriers In E Commerce And To What Extend The E Commerce Act 2006 Manage To Overcome The Barriers

1896 words - 8 pages

The advent of internet has transformed the traditional marketing model and system. Besides functioning as a communication medium, internet has been used as a market space where buyers and sellers exchange information, goods and services without the hindrance of time and geographical constraints. Commercial activity on the internet which is known as e-commerce is a recent and rapidly growing business medium. However, despite of its rapid growth, there are a few legal barriers that take place.

The first legal barriers that can be seen when e-commerce was introduced are security. Security is said to be one of the major worry as people that conduct e-commerce must give out their credit card ...view middle of the document...

Both the government and the private sector should also take measures to ensure the safety and reliability of information infrastructures - especially as a means of reducing transaction costs for users and suppliers. Not having equal access opportunity for all countries will hinder the expansion of the e-commerce market.
The third legal barriers of e-commerce are hacker’s intervention. The internet is a decentralized system spread across millions of computers worldwide. Each of these machines has its own passwords and security procedures. Hackers may break into one part of the system and later on will be able to gain access to the rest of it. Recently, “crackers which is a name given to malevolent computer hackers have exploited holes in the global computer network to gain control of computers. This often involves “Internet Protocol Spoofing” allowing cracker to bypass security measures known as “firewalls” by posing as a friendly computer on an organization’s internal network.

The fourth legal barriers of e-commerce are privacy. Privacy is the most reported reasons of the legal barriers of e-commerce. This is because, if the instantaneous transmission of information is not managed carefully, it will diminish the personal privacy of the consumer. Therefore, it is important to ensure the personal privacy in the networked environment if people are to feel comfortable in doing business. Privacy concerns are being raised in many countries around the world and some countries have enacted laws, implemented industry self-regulations, or instituted administrative solutions designed to safeguard their citizen’s privacy.

The fifth legal barriers of e-commerce are the payment system. The availability of credible payment channels such as credit cards. An institutional environment that facilitates the building of transactional integrity is critical to the development of ecommerce. This infrastructure makes payment over the internet possible such as through credit, debit, or smart cards, or through online currencies. It also makes possible the distribution and delivery whether online or physical of those products purchased over the internet to the consumer. Its growth further requires the establishment of reliable and secure payment infrastructures to avoid frauds and other illegal actions. A supportive electronic payments infrastructure is crucial to promote e-commerce, which exposes a key link between ecommerce and the financial foundation of the economy. The efficiency of the payments system itself can help or hinder the development of e-commerce. Few people in developing countries have credit cards, most banking sectors in developing countries lack a national clearing system and potential customers are suspicious of being cheated. In most developing countries users may be unable to purchase online because credit cards are not accepted without a signature. Additional confirmation via fax is necessary to complete the payment. In addition, in the case...

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