New laws needed to tackle challenges of e-business - Daily Nation

New laws needed to tackle challenges of e-business

Saturday March 17 2007

By ANDREW LIMO, [email protected]

The fast growth in the use of information and communication technologies (ICTs) as a tool of doing business in what has come to be known as electronic transaction or e-transaction is a great challenge for policy-makers. Invariably, when it comes to technology, the law plays catch up. 

There is a story the enthusiasts of electronic law like to tell. A man who stole a credit card ended up in court accused of stealing a “plastic card”. You can imagine the punishment he got for the serious crime that law did not understand. Maybe a mere reprimand!

That we can now transfer money through mobile phones certainly raises concerns for a redress mechanism should something go awry. Users of Safaricom’s new M-Pesa service that enables money transfer on the mobile phone are required to produce their identity cards to use the facility. That is a good precaution.

THE TERMS AND CONDITIONS (clause 8.5.6), states in part that “Safaricom shall not require any written confirmation of any transaction instruction”. Since there is no paper work involved and much reliance is on the mobile phone number and the PIN, issues are bound to come up especially from the users of the technology which is likely to be popular with the low income earners.

In the event of a dispute, will the firm readily make computer printouts of a transaction available? Will such evidence be admissible in a court of law? 

In social spheres, an email is a great communication tool but in business the sender will want an assurance that the recipient will find it legally sufficient to act on the strength of the electronic message. There is lots of global business that is going on over the Internet without the trading parties having to establish physical contact. 

An amendment to Kenya’s Evidence Act, Cap 80, (2000) allows for the admissibility of electronic or computer records or scanned documents as evidence in court. These include micro-film, facsimile and all forms of computer printouts ( ). 

Existing policy documents like e-Government Strategy 2004 and ICT Policy 2006 do not adequately address critical issues like:

--Legal recognition of e-signatures

--Mechanisms for online dispute resolution

--Data protection and privacy

--Intellectual property rights

--Cyber crime

The need to amend existing laws and/or enact new digital laws is apparent. First, we are dealing with a highly dynamic situation where people want to use technology because it is convenient. 

Second, in addition to the traditional use of communication, ICTs are increasingly becoming vital tools for business or e-Commerce and e-Government applications. 

Third, Kenya needs to urgently claim her stakes in a global business that knows no better way to thrive than in a secure, regulated online medium. 

To address issues of Internet fraud and how to protect the consumers online, some countries have come together to form consumer protection and enforcement networks. By subscribing to such organisations, countries earn themselves international business trust. ( ). 

Efforts have been made in Kenya and within East Africa to address these gaps in law that have emerged as a result of the use of technology. 

In the last one year three major regional stakeholders’ workshops have been held to address the concerns of e-transactions — EAC regional cyber law workshop (Kampala, April 2006), e-transaction workshop (Mombasa, November 2006) and UNCTAD regional workshop on e-legislation and e-commerce (Nairobi, December 2006). 

THERE IS NEED TO BUILD ON THESE initiatives and come up with a draft policy to be incorporated with the Kenya ICT Bill 2006 or as a separate “e-Transaction Bill”.

The Directorate of e-Government, with the support of relevant arms of government and USAid, is trying to consolidate the efforts made in these past meetings and come up with a document to be presented in Parliament. 

The challenge, however, is that this being an election year, MPs may not have time for ICT. The Kenya Law Review Commission and the State Law Office may not have the capacity to fasttrack the process.

But in drafting digital laws, those charged with the responsibility need not reinvent the wheel. They could cut, paste and customise from laws of countries like Namibia, Egypt and the United Arab Emirates who have successfully implemented cyber laws. 

There is also the United Nations Commission on International Trade Law ( ) which is essentially a model law to countries developing legislation.