World ministers meet to discuss Net conduct

Ministers of the world's leading industrialised countries have agreed that stronger regulations and safeguards may be needed to bolster consumer confidence in electronic commerce on the Internet, but failed to resolve differences over what kinds of measures should be taken.

Contrasting views, notably between the US and the European Union, over whether governments or industry should take responsibility for consumer protection and data privacy dominated a recent two-day ministerial meeting on e-commerce held by the Organisation for Economic Co-operation and Development (OECD).

The US, backed by the chairman of IBM, Mr Lou Gerstner, and other industry leaders, argued in favour of consumer protection and data privacy arrangements which relied mainly on voluntary codes of conduct and self-regulation by business.

The EU, whose impending data protection directive has created a dispute with the US, defended an approach based on legislation, while consumer and trade union groups at the conference urged OECD members to establish minimum standards of consumer protection on the Internet.

Scepticism about the effectiveness of the US self-regulatory approach was also expressed by Mr John Manley, conference chairman and industry minister of Canada, whose government recently tabled legislation designed to tighten up its data protection rules.

"A lot of America's trade partners are going to hesitate if it relies entirely on self-enforcement," he said. "If it already has such a large market share in e-commerce, it perhaps believes it can set the rules for others."

In an effort to paper over their divergences, the ministers agreed on a vaguely worded statement saying they would "work to build bridges" between the various approaches. They also pledged to draft voluntary guidelines on consumer protection, in the OECD next year.

Despite the differences between the US and EU, both appeared determined to avoid an angry public confrontation while seeking to resolve their disagreements over the EU directive, which takes effect on October 25th.

The OECD conference was attended by almost 1,000 people from government, industry, trade unions and public interest pressure groups. is claimed to be the first event to bring together such a diverse range of participants to debate the future of e-commerce.

Although the meeting yielded few substantive decisions, Mr Manley said it was a landmark occasion which advanced the global agenda for dealing with the issues raised by e-commerce.

The meeting resulted in agreement between governments of industrialised countries and leading business organisations to work together to develop a common approach to taxing electronic commerce.

The outline agreement aims to ensure that e-commerce is taxed on the basis of neutrality, and to avoid double taxation of the same transactions by tax authorities in different countries.