Joint Foreign Chambers (JFC)
Country Investment Climate Series
GOVERNANCE OF DIGITAL DATA & COMMUNICATIONS
Part 2: Regulation of Online Retail Selling
25 March 2021, Thursday, 2 PM to 4 PM via ZOOM
Atty. Victorio Mario A. Dimagiba, AB, LLB, LLM
President of Laban Konsyumer Inc.
OUTLINE OF PRESENTATION
- EASILY UNDERSTOOD TERMS & CONDITIONS OF ONLINE CONTRACTS (ISO COPOLCO )
- MAINTAINING TRUST AND ACCESS IN DIGITAL COMMERCE ( WEF AND CONSUMERS INTERNATIONAL)
- JOINT STATEMENT INITIATIVES ON E –COMMMERCE (WTO )
- SMALL PACKAGE DELIVERY SERVICES OR SPDS (OECD and PCC )
- This is an information session for ISO member bodies on improving consumer understanding of online Terms and Conditions: supporting responsible business practice.
- Shopping Online poses increased consumer risk, i.e. spontaneous decision more mistakes opportunities, no opportunity to inspect items , payment in advance , easy to feel “detached “ from amount of money spent.
Some data on growth of e-commerce
- E-commerce sales Online Retail Sales
- 2016 – $ 1.6 tr 2016- 8.6 %
- 2019- $ 3.53 tr 2019- 14.1 %
- 2023- $ 5.64 tr 2023- 22%
- Asia Pacific plus China 62.6%, North America 22.9 %, Western Europe 16.2 %.
- Consumer laws vary between countries and cross border issue may not be protected by the national law.
- Understanding the online T & C is essential for consumers across the world to understand their rights and obligations.
- Statistics show that it takes 39 m to read the ABnB T & Cs, or 75 days to read a year’s worth of Online T & Cs. Less than 10% of online shoppers read the T & Cs
- There is need for an international standard to enable responsible business practices, improve consumer trust and confidence in online markets and practice consumer protection even without legislation
- The standards shall include larger retailers, small and medium retailers, law firms, sectoral regulators, consumer organizations, academe and research bodies and standards application businesses
- The New Work started in UK government , developed by the Consumer Public and Interest Network or CPIN , supported by the British Standards Institute or BSI, approved by the ISO COPOLCO and out for ISO member vote .
- Effective techniques to improve consumer understanding of T & Cs
- To increase understanding of T & Cs
- Display key terms as FAQs
- Use icons to illustrate key terms
- Show customers terms within a scrollable text box instead of requiring a click to view them
- Provide information in short chunks
- Use illustrations and comics
- To increase opening of T & Cs
- Tell consumer how long will it take to read the policy
- Tell consumers the last opportunity before making a decision.
- Government guide: Use of icons
- The timeline
- ISO vote closes March 3, 2021
- 1st draft October 1, 2021
- Committee draft ballot March 1, 2022
- DIS submission March 1, 2022
- Publication April 1, 2024
- Credits: BIS, CPIN, ISO COPOLCO
- At the World Economic Forum virtual dialogue on “ Maintaining and Growing Trust in E Commerce held last December 1, 2020, my topic was “What policy should the country put in place in order to grow the e -industry into a robust industry that consumer can trust “
- ISO PNS 20488:2020 on principles of online reviews and requirements for their collection, moderation and publication. The standards shall apply to any organization that publishes consumer reviews including suppliers of products and services that collect reviews from their own customers, a 3rd party contracted by the supplier and an independent 3rd party. It gives recommendations in order to increase consumer trust in online reviews, increase the protection of suppliers from exploitation and mischief, and improve the purchase decisions of consumers and the quality of products and services provided by organizations. Online review site offers consumers the chance to give feedback about their experience of using sites.
- In the Philippines, there are 3rd party verification start ups but the question is how do they authenticate . Let us avoid a trap that market reviews are solicited, there should be professional and 3rd party e –commerce site that provides impartial review of online site .
- In the breakout session of the WEF dialogue, the question asked is “what collaborative actions can help reassure consumers on data treatment and transfer in the new digital age?
- My answer was the public and private sector should nurture establishments on online rating platforms. This will contribute building consumer trust in online sellers that pass their reviews.
(You can access my column, Consumer Hotline on Data Free Flow with Trust, Part 1 and Part 2, in Manila Bulletin, November 28 and December 5, 2020 issues)
- The Consumers International is a 60 year old global consumer movement composed of 250 consumer organizations in 100 countries . Our consumer group, Laban Konyumer Inc is an active full term member of CI since 2017.
- For consumers , e- commerce is known as B2C relationship . There are growth in sites known as C2C e-commerce, that allow consumers to buy and sell directly to other consumers. These platforms earn from small fees charged to the sellers and convenient payment method , A variation of C2C is Peer to Peer ( P2P ) e commerce type more closely associated with servoces like AirBnB, or Uber or Grab , that had disrupted industries .
- Cross Border e commerce is important in the economic development of the country. This is particularly exciting for the Philippines as we are predominantly a consumer nation than a producer . Thus , even the WTO are developing new rules on e- commerce .
There are 2 major barriers to e –commerce. Access and Lack of Trust.
- The consumer experience of shopping online is affected by numerous local factors like internet, payment system , state of consumer protection , unclear and confusing business practices to outright scams and cybercrime including the lack of redress.
- The Philippines is one of the 86 members of the Joint States Initiative or JSI negotiation group under the WTO umbrella where Consumer Protection is one of the thematic issues under Trust and electronic commerce.
- The negotiating text includes protection of consumers from misleading, fraudulent and deceptive commercial activities such as false claims as to quantities, price, and suitability for purpose, quantity or origin of goods and services, advertising goods without intention to supply, failure of delivery and charging financial accounts without authorizations. Consumer redress mechanism as well as Fair business practices are include in the negotiating text
- General information on Philippine Setting as to Existing Policy under Consumer protection and cybersecurity
- Consumer Act of the Philippines ( RA 7394 )- under amendment
- E Commerce Act ( RA 8792 )-under amendment
- Cybersecurity Prevention Act ( RA 10175 )
- Data Privacy Act of 2012 ( RA 10173 )
(Updated December 16, 2020 and February 9, 2021. Credit to Philippine WTO staff)
- General information on Philippine Setting as to Existing Policy under Consumer protection and cybersecurity
- ASEAN Agreement on Electronic Commerce
- E-Commerce Philippines Roadmap 2022
- Proposed Internet Transaction Law ???
- Online Dispute Resolution System ???
- Use of digital payment in Financial transactions Bill???
(Updated December 16, 2020 and February 9, 2021. Credit to Philippine WTO staff)
- OECD Reports Launch in the Philippines, A competition assessment review: Logistics Sector in the Philippines, January 29, 2021.
- Small Package delivery services plays a fundamental role in the rapidly growing e – commerce sector. COVID 19 accelerated this development.
- E- Commerce growth was 33% in 2020. Philippines has 53% increase in the use of shopping apps.
- The study reviewed the PHILPOST public service obligations.
- Lifting barriers to logistics is needed to further support development of e- commerce.