Khane-Noor University

Faculty of Management Science

Subject: E-Commerce
Lecture # 15
Lecturer: Zabihullah Zakhil

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Outline
International Issues
Global Legal Issues of E-Commerce

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Objective
After studying this chapter, you will be able to understand:
◦ International Issues
◦ Global Legal Issues of E-Commerce

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Lack of Trust
Because they face dangers like identity theft and spam on a day-to-day basis, direct
marketers are finding it difficult to make sure that their website privacy statements and
data protection systems follow the latest legal requirements and standards.
in order to gain the trust of their target markets and fully maximize the potential of
electronic commerce (e-commerce).
Language and Localization
When operating in a single country, language issues are few and far between. Even if you’re
not a native speaker, the fact that you have a single language to master means your attention
can be devoted to this task. With international ecommerce, things get complicated as the need
to provide consistent customer experiences increases. When a prospect comes from China or
Germany, even if their browser is set to English, they won’t necessarily grasp idioms or etc.
Culture
Language isn’t the only factor that determines whether content resonates. Sometimes,
even the best literal translations end up in embarrassing blunders,
Worse, different people groups have different cultural standards and customs. What can
be considered funny or casual in one culture may be nonsensical or downright offensive
to those from different backgrounds.
Firstly, there is the issue of choice of name.
Example,
◦ a famous car manufacturing company had chosen the name ‘nova’ for one of its car
models, which could be understood by the people in Latin America in the sense that ‘it
will not go’.
◦ when KFC’s motto “Finger-lick in’ good” was translated in China to read: “We'll eat
your fingers off.”
◦ Or when Ford’s ad “Every car has a high-quality body” ended up reading in Belgium:
“Every car has a high-quality corpse.”
Technical Infrastructure and Speed
Infrastructure within most of countries is more or less uniform, and unless you opt
for a cheap solution your visitors will enjoy solid uptimes and loading speeds.
When you move overseas, things change dramatically. If you rely on the same
servers as a one-size-fits-all solution, you’ll soon notice that certain geographies
have much slower access. Internet infrastructure includes computers and software
connected to internet and communication networks over which data packets can
travel. In many parts of the world, telecommunication industry is either owned by
the government or it strictly regulated by the government.
 Global E-commerce issues
E-Commerce is done on the data and information available on the Internet. Here,
parties involved in ecommerce send and receive data. The data shared can be
damaged due to many reasons like power failure, viruses, and physical damage.
There is also the danger of hackers who can illegally access computer systems,
violate privacy and tamper or damage records. In order to secure e-commerce, it
has become necessary to give legal rights and obligations in the interest of the
companies involved in e-commerce

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Trade mark and domain name conflicts
The dot-com domain is used by commercial entities to identify them in cyberspace. The
latter is worldwide, since the Internet is not confined to any geographical boundaries. The
advantages pose a problem too. A company uses its name to take a domain name from the
registry. Unlike the traditional commercial world where different companies may have the
same trademark in different products or services, in cyberspace only one name can be given
as Name.com. Therefore, the company, which registers its name first as the domain name
removes all the others from the cyberspace. As one would expect, this leads to legal battles.
It has been argued in the court of law that a domain name functions as a trademark, but
using it as a domain name is guilty of the trademark infringement.
The infringement of trademarks using domain names is on two grounds:
Confusion
Dilution
Copyright and the Internet
In the printed world, copyright was developed to protect the economic interests
of the creative writers. The copyright law protects expression of an idea and not
the idea itself. It also protects the originality of artists and innovators. In recent
times, the subject matter of copyright has been expanded further to protect the
writers.
Example: - In U.K., Copyright, Designs and Patent Act, 1988, allows the
protection of the following subject matter:
Original literary, musical, dramatic, and artistic works
Typographical arrangement of published editions of literary, musical, or
dramatic works
◦ Sound recordings
◦ Broadcast
◦ Cable programs

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Example
Napster case is used to provide software and a network to millions of people
using which they could exchange music files on internet that they had copied
and compressed into MP3 format. Many music recording companies sued
Napster for facilitating violations of their copyright and court ordered that
Napster site should be shut down. Napster agreed to pay 26 million dollars in
damages for copyright infringement to a group of music companies and agreed
to pay copyright holders for the music that would be downloaded in future.
World Intellectual Property Organization (WIPO) is a U.N. sponsored body. In
1996 it proposed two international treaties on copyright which were signed by
many countries of the world.

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 Territorial Jurisdiction
The Internet allows anyone to set up a Web site anywhere in the world. Its location can be
used to decide the jurisdiction of disputes. The Web site might accept orders from visitors to
the site as part of a shopping mall or the Internet store.
Example: - Consider an online retailing bookstore site, which sells books. A court of law may
consider the location of the Web site to determine which law would be applicable. E-
Commerce on the Internet will grow if the parties doing business know what rules will govern
their activities.
Under different jurisdictions, different laws will be applicable. Many questions that are
important to the legality of commerce in cyberspace have arisen which are as follows:
1. Who has the right to prescribe the law in a given area?
2. Where can the action commence and should the entity be subjected to legal proceedings?
3. How and when will the arbitral award or court judgment in one jurisdiction be enforced in
another?
Formation of an Enforceable Online Contract
The growth of e-commerce depends on the confidence of traders in forming legally
enforceable contracts online. The main activities related to the formation of an enforceable
contract, take place in the Internet i.e., the offer is communicated in the e-commerce
environment through the Internet orally or in writing.
Electronic acceptance of the contract through e-mail and e-form is valid in the same way
as a fax message is valid. The offer can present the terms and conditions as a legal notice
on the Web site. Visitors to the site, who choose to proceed further, even after reading the
notice, can be construed as accepting the conditions enforced. The timing of the
acceptance offer decides the laws which would be applicable in case of dispute. Then,
there are issues pertaining to identity of parties and the role of digital signatures on the
Internet.
Parasites
Parasite domain names are variants on famous domain names, and are confusingly
similar to them to gain business advantage. A software company may intentionally
register a domain name as ‘mamazone.com’ to take advantage of the reputation of
‘amazon e-commerce company’. International Corporation for Assigned Names and
Numbers (ICAAN), which supervises the task of registration of domain names
worldwide, has developed and implemented a policy known as Uniform Dispute
Resolution Policy (UDRP) for deciding domain name disputes.
Concurrent use
When two companies are registering for the same domain name which is not possible
because of uniqueness of the domain name. Suppose, there are two companies
manufacturing electronic cars want to register for e-car under traditional law both these
companies can have the same trade mark and name but one of them can select the same
name, this situation is called concurrent use.
Cyber squatting
Cybersquatting means registering, trafficking in or using a domain name with the
intent to profit in bad faith from the goodwill of a trademark that belongs to
someone else. It commonly refers to the practice of buying up domain names that
use incorporate the names of existing businesses with the intent to sell the names for
a profit to those businesses. The term derives from squatting, the practice of building
some kind of home or dwelling or in some way using someone else's landed property
without their permission.
Example: - Microsoft name in .com, .net, .biz, .org, .edu, .af and money other types.
 Conclusion
Internal and Global issues
• Lack of trust
• Language and Localization
• Culture
• Technical infrastructure
• Trade mark
• Copyright
• Territorial Jurisdiction
• Formation of valid contract
• Parasites
• Concurrent use
• Cyber squatting

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 References
1. Reference 1
2. Reference 2
3. Reference 2

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