LML4810 Assignment 1 Semester 2 2022

LML4810: Assignment 01 Semester 2: 2022 Unique number: QUESTION 1 Discuss the legal challenges that electronic commerce poses to consumers and businesses, also explain the extent to which the Electronic Communication and Transactions Act of 2002 has addressed these challenges. (15) The following are the challenges posed by e-commerce as noted in the Green paper: taxation; 1 intellectual-property protection; consumer protection domain naming; electronic-payment mechanisms. Eiselen2 highlights the following as perceived legal uncertainties: validity of the agreement; offer and acceptance; automated contracts and agency; time and place of contracting; formalities; incorporation of standard terms; jurisdiction. These challenges are addressed in the Electronic Communication and Transactions Act. 3 The ECT Act was assented into law on the 31st of July 2002.4 MEMO CONTINUES…. J The challenges or legal certainties are located in the following chapters under the ECT Act: chapter 3 which covers the issue of facilitating electronic transactions, which is divided into two parts namely: part 1 which deals with the legal requirements of data messages; 5 and part 2 covers 1 Green paper at 22-24. 2 Eiselen “E-Commerce” 144; also, Green paper at 17-20. 3 Hereafter referred to as ‘the ECT Act’. 4 Act 24 of 2002. 5 See ss 11-20 of the ECT Act. Also see the following for discussion Communications and Transactions Act” 269-295. communication of data message.6 In creating public confidence in electronic transacting, the ECT Act also covers consumer protection issues covered in chapter 7. 7 Other provisions include the issue of domain names which is discussed under sections 68 and 69; and Internet service providers sections 70-79. How can Africa harmonise its e-commerce laws in order to address the obstacles noted above. 1. Quality of life: to improve the quality of life of people through the optimal use and the exploitation of electronic commerce, thus ensuring socio-economic development and facilitating equitable development. This is consistent with the constitutional requirements and obligations. 2. International Benchmarking: to ensure international consistency, alignment and harmonisation. South Africa needs to be in line with international treaties and develop an e-commerce policy that is based on international trends and benchmarks while taking cognisance of South Africa’s special requirements. 3. Consultative process: to be consultative, transparent and to balance the interests of the broader spectrum of stakeholder through the solicitation of the public to participate in the deliberations. This is an ongoing process and has been taking place via electronic and written submissions by individuals and interest groups. 4. Flexibility: to be flexible in establishing rules and regulations for governance. The introduction of new measures and elements into law will take place within the relevant branches of law. 5. Technology neutrality: to cause the proposed legal framework be technology neutral 6. Supporting private-sector-led and technology-based solutions and initiatives wherever possible 7. Public-Private partnership: to establish public/private partnerships that will promote and encourage the development and use of electronic commerce. The private sector will remain a critical driving force in the effort to optimise the potential of e-commerce. 6 See ss 21-26 of the ECT Act which covers formation and validity of dispatch and receipt (section 23) among others; also see Jafta v Ezemvelo KZN Wildlife [2008] these sections were discussed. 7 See ss 42-49 of the ECT Act. For a discussion on consumer 63-93; and Eiselen supra 9 at 179-191. 8. Supporting small, medium and micro enterprises (SMMEs) and informal sector: to facilitate the promotion and development of SMMEs and the informal sector, and contribute to their speedy adaptation of ecommerce. THE ELECTRONIC COMMUNICATIONS AND TRANSACTIONS ACT 25 OF 2002 In terms of section 45(1) of ECTA, any person who sends “unsolicited commercial communications” to consumers, must provide the consumer with the option to cancel his or her subscription to the mailing list of that person, and with the identifying particulars of the source from which that person obtained the consumer’s personal information, on request of the consumer. Any person who fails to comply with or contravenes section 45(1), is guilty of an offence and liable, on conviction, to the penalties prescribed in section 89 (1) (i.e. a fine or imprisonment for a period not exceeding 12 months). Similarly, any person who sends unsolicited commercial communications to a person who has advised the sender that such communications are unwelcome, is guilty of an offence and liable, on conviction, to the penalties prescribed in section 89(1)8 . THE CONSUMER PROTECTION ACT 68 OF 2008 Section 11 of the CPA confirms the consumer’s right to restrict unwanted direct marketing, by providing that the right of every person to privacy includes the right to refuse to accept; require another person to discontinue; or in the case of an approach other than in person, to pre-emptively block, any approach or communication to that person, if the approach or communication is primarily for the purpose of direct marketing. THE NATIONAL CREDIT ACT 34 OF 2005 Section 74(6) of the NCA provides that when entering into a credit agreement, the credit provider must present to the consumer a statement of the following options and afford the consumer an opportunity to select any of the options, namely to be excluded from any telemarketing campaign that may be conducted by or on behalf of the credit provider; marketing or customers list that may 8 Electronic Communications and Transactions Act 25 of 2002 S - The Marketplace to Buy and Sell your Study Material be sold or distributed by the credit provider, other than as required by the NCA; or any mass distribution or email or sms messages. It is also submitted that credit providers should, once POPI becomes effective and for purposes of direct marketing, also comply with the other requirements set by proposed clause 71(3). THE PROTECTION OF PERSONAL INFORMATION BILL “Processing” is very widely defined in clause 1 of POPI as “any operation or activity or any set of operations, whether or not by automatic means, concerning personal information, including – the collection, receipt, recording, organisation, collation, storage, updating or modification, retrieval, alteration, consultation or use; dissemination by means of transmission, distribution or making available in any other form; or merging, linking, as well as blocking, degradation, erasure or destruction of information”. QUESTION 2 Choose two challenges above and compare and contrast them with the provisions in the UNCITRAL Model on Electronic Commerce of 1996, and the SADC Model Law on Electronic Transactions and Electronic Commerce of 2012. (10) Total: [25] • Our Country’s (South Africa) legislation on electronic commerce obtains its provisions from the UNCITRAL Model Law9 and SADC Model law10 on electronic commerce. • The SADC Model Law furnishes a tool that member states can use to create a more secure legal environment for electronic transactions and electronic commerce.11 • It also aims at enhancing regional integration and has implemented the best practices and collective efforts of member states to address the legal aspects of e-transactions and ecommerce. 9 UNCITRAL Model on Electronic Commerce with Guide to Enactment (1996). 10 Southern African Development Community (SADC) Model Law on Electronic Transactions and Electronic Commerce Harmonization of ICT Policies in Sub-Saharan African (2013) 1. Hereafter referred to as “SADC Model Law”. 11Preamble of the Southern African Development Community (SADC) Model Law on Electronic Transactions and Electronic Commerce Harmonization of ICT Policies in Sub-Saharan African (2013).