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JILT 1998 (3) - Editorial


Alistair Kelman

As the century draws to its close there is one alleged hope for growth and development - Electronic Commerce. But it is predicated upon revolution. Not nice tidy change that, in the words of Professor Ian O. Angell, 'today's snake oil salesmen, the management gurus, sell in their 'Change Management seminars'; not a nice tidy transition - but a severe and total dislocation with the past.'

Electronic Commerce is going to revolutionise spending habits and change the way everyone does business. The reasons for this are many and varied; globalisation and the dismantling of trade barriers, the deployment of smart cards, the Internet, and the de facto emergence of English as the global language.

In the articles in this Special Feature we have sought to outline some of the immediate potential problems which face governments and lawyers all over the world. These problems may not pose barriers to the technology being deployed. Rather,they indicate the scope of the problem for the legal profession. Matthew Ford's article on Identity Authentication and 'E-Commerce' is a useful addition to the literature on this topic and bears careful study. But it is not easy reading even for technically literate lawyers.

Chris Swindells and Kay Henderson' article 'Legal regulation of electronic commerce' is an easier read but illustrates a further point. Electronic Commerce is coming in very rapidly (from $8 Billion this year to $327 Billion in 2001 - Source; eMarketer - July 1998) Commercial lawyers understand conventional commercial systems and their jargon (Letters of Credit, Bills of Exchange, INCO terms etc). But to practice in two years time they will need to understand all the underlying concepts and jargon of secure electronic commerce (Digital certificates, Trusted Third Parties, DES, TwoFish etc). Many commercial lawyers and judges will be bewildered by the transition.

And during this period of transition it is certain that the world economy will pass through a period of vulnerability to fraud until the new risks are well understood and controlled. There are also legal minefields out there which pose undreamed of problems for comfortable European lawyers. J.T. Westermeier's Personal Jurisdiction: Today´s Hot Issue in E-Commerce' sets a good framing of the situation in the USA which has the benefit of a uniform common law system. Unfortunately for us Europeans living with mixed common law and civil law systems the issues are even more complex. Even without 'help' from the European Commission we can find we are not talking about the same things.

There is a general consensus that continental Europe is in the slow lane regarding growth in electronic commerce, mainly due to its telecommunications costs which are approximately five times higher than in the United States. This negative factor is considered to be compounded by fewer wired customers, higher hardware and software costs plus concerns about security, taxes and language problems.

But that is not going to stop the world economy making the transition. Louise Kehoe in the Financial Times on September 9th 1998 set the situation out very well:

If Europeans are looking to their governments and the European Union to make e-commerce as cosy as doing business in their own back yards, they will wait in vain. If they look to governments to create regulations that might hold back the competitive challenges that e-commerce could create, they might just as well seek highway speed limits to suit the horse and buggy.

'Yesterday does not work anymore.' The commercial litigator who does not comprehend the changes that are going to overtake him will go the way of the farm horse, eliminated by tractors.

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