, JANUARY 22, 2007
  (STAR) HINDSIGHT By Josefina T. Lichauco - I would like to thank Prof. Timothy H. Roth of Philadelphia, Pennsylvania, USA, for the e-mail he sent me, which contained a paper on the traditional objective territoriality principle in international law, in relation to traditional contracts today. As regards e-contracts involving two or more states, he asked me the same question two young Indonesian lawyers from Jakarta asked in a joint e-mail.

The wealth of information about Internet-related contracts, rights and obligations, liabilities and limitations, debt collections, billings, refunds, intellectual property rights and other e-nuances where Internet law might be lacking or unclear, is getting to be quite extensive, so that I can understand the need to fast-track, or get a quick fix, from articles/analyses in papers like mine.

This particular niche in the national and even the international scene is a very seductive and exciting one for me. I said "international" because I get quite a bit of e-mail from abroad, am grateful for this, and am trying, through constant study and research, interaction and attendance at different fora, to be current in my thinking and examination of what I have called "Evolving Internet Law."

I remember when I was invited to participate in a lecture on investments and international law about four months ago, where a foreign professor-expert lectured on intellectual property rights, among other related topics. This is a topic that is critical in the evolution of Internet law. When I asked him during the open forum if he had been able to update this portion of his discourse, taking into consideration the complexities of current e-regulations on the matter, his response was in the negative.

It is my belief that Internet laws, rules and regulations as they stand today, as well as the current analyses of conflicting legal theories, especially in the global arena, should be studied.

It is an e-world we live in today. If one has to do business effectively, oneís lawyer should be aware of that dimension of growing e-complexities. Of course, we are all aware that, absent the e-law on the matter, traditional laws apply. But let not any e-regulation, already nationally, regionally or globally accepted, disturb the equanimity of the businessman and his lawyer.

For example, as regards the venue of a legal action, what if a resident of London e-purchases a book from Amazon.com whose services and offices are located in the US, and the book is damaged en route or never arrives? How and where does the buyer take action? If my memory serves me right, this was one of the hypothetical questions contained in the e-mail of the two young Indonesian lawyers. For it is not as simple as it seems today.

To my mind, most e-contracts will specify the jurisdiction in which a legal action may be brought as a result of the transaction. If the e-contract is silent, traditionally, the rule-of-origin applies, so that following this approach, the law in the jurisdiction in which the sellerís business is located will apply.

For conventional consumer transactions, it is generally accepted that the laws of jurisdiction in which the bookstore is located apply. But the nature of the Internet results in substantial disadvantages to the consumer if this approach is adopted. In fact, most e-buyers would be left without effective recourse in the event of a wayward e-transaction.

Participants in e-commerce currently have the choice of adopting either a freedom-of-contract rule or a rule-of-origin approach. The freedom-of-contract would enable parties to hash out the conflicts in regard to what should be the applicable law within the provisions of their own contracts. Experience has proven, however, that this works well when the negotiating parties are in equal bargaining positions.

Business-to-business relationships are the most typical examples of such a transaction. Consumer-to-business relationships are generally not associated with the negotiation of equals. Most of the time and in almost all jurisdictions, standard contracts written by and favoring the business are the rule. When such standard contracts are applied to an Internet transaction, the rule-of-origin should be adopted. Lawyers of consumers and consumer-firms should make certain that this will be the rule that should govern the relationship between the consumer and business firm.

As consumers consider executing an e-contract, they must consider the question of risk. If the transaction fails, will they be in a position to take legal action, or will legal action not be practical? On the other hand, the value of most consumer e-commerce transactions is relatively small; consequently, most of those parties who enter into these e-contracts are able and willing to bear the risk. Of course, the traditional time-honored concept of caveat emptor (buyer beware), in all its ramifications, applies just as well to an e-contract.

As e-businesses execute e-contracts, they must consider the cost of operating in more than one jurisdiction and developing country-specific Internet sites, as well as adjusting their practice and policies to reflect the local law. The big guys in business can, of course, afford to do so. The small guys cannot.

There is a lot of interaction between and among states as far as overseas e-businesses are concerned, and also where Internet content of ISPs (Internet Service Providers) is concerned. In 1996, for instance, police in the United Kingdom pressured several major ISPs to eliminate content that was considered pornographic. The relationship involved here pertained to that between the state of the UK and all the states of the world community.

In an unrelated action the same year, a German court ordered German ISPs to block access to a Netherlands provider because it hosted a page that included neo-Nazi propaganda, which is illegal in Germany. This involved a relationship between only two states principally.

Contemporary relations between the Western world and the Arabic and Muslim world are delicate and very sensitive. Recent events have drastically worsened the situation. The Internet medium has a strong influence on improving or worsening the critical condition. America has always arbitrarily employed the rule-of-origin approach regardless of what the United Nations Security Council has pronounced. Most recent events have not improved the situation. It looks like the current US president has no intention of tempering his plans and policies.

His Holiness Pope Benedict had to go the extra mile to give the correct interpretation of a statement that affected the sensibilities of the Muslim communities of the world. There was definitely enlightened judgment in the approach Pope Benedict chose in order to assuage any hurts caused by his statement. Let us see where the judgment of what, to my mind, a lesser man like President George Bush will take him.

Manís judgment, after all, is so critical in any relationship. The e-business relationship between two states is no exception.

French moralist Francois de La Rochefoucauld said, "Everyone complains about his own memory and no one complains of his judgment." If a computer can remember its instructions, judgment is a whiz because a computer is nothing but on and off switches; it cannot make a mistake. Only the people who program or design it can make a mistake, but thatís another story.

Chief News Editor: Sol Jose Vanzi

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