Best practices in the implementation of the E- commerce Directive(ECD) in Slovak republic". TAIEX Belgrade, June 2008

E commerce growth The development of electronic commerce within the information society offers significant employment opportunities in the Community, particularly in small and medium-sized enterprises, Stimulates economic growth and investment in innovation by European companies, and can also enhance the competitiveness of European industry, provided that everyone has access to the Internet

Internet use in 2007 % population

Development prognosis In the next 3 years promising developmnet % GfK

Trustmark

Objectives introducing ECD To create relationships between information society service providers and the recipients Implementation of the e-Commerce = enhance competition in the market for online services Directive must lay down a clear and general framework to cover certain legal aspects of electronic commerce in the internal market To create a legal framework to ensure the free movement of information society services between Member States and not to harmonise the field of criminal law as such. Before adopting the ECD the Slovak e-commerce framework was not based on the adoption of specific laws, but rather finds its origins in the general norms of private law, consumer protection law, data protection law, etc

Milestones The Slovak Republic transposed into its legal system the Directive 2000/31/EC by the Electronic Commerce Law No. 22/2004 which came into effect on 1st February In order to make additions to the basic law and add precision to some of its provisions, the Electronic Commerce Law was amended by the Law No. 160/2005 of the Collection of Laws, which came into effect on 1st May 2005 This created a legal framework that establishes conditions similar to those that are in force for this area in the EU

ECD Content The E-Commerce Directive(ECD) covers all services conducted over the Internet. ECD covers a wide range of on-line activities as: selling goods and services on-line, including offering on-line information by subscription-based information providers and banner adverts on websites

Scope of the law The ECD legalized the way of e-communication between enterprises and consumers, between enterprises, and/or between citizens, enterprises and public authorities In some legal relationships (especially contractual ones), the Law contains references to the respective legal regulations (Commercial and Civil Code) The ECD regulates the rights and obligations of service providers and recipients, and it specifies when the provider is not liable for the information transmitted.

ECD principles ECD, adopted in 2000, set up an Internal Market framework for electronic commerce, which provides legal certainty for business and consumers The relationships between information society service providers and the recipients The supervision of compliance with the law, International cooperation in electronic commerce Cross-border e-commerce complaints-country of origin principle

To whom it concern The ECD covers all Information Society services, B2B, B2C, and services provided free to the recipient Examples of online sectors and activities covered include shopping, newspapers, databases, financial services, professional services (such as lawyers, doctors, accountants, estate agents), entertainment services, direct marketing and advertising and internet intermediary services.

Internal market principle The Directive's Internal Market clause means that information society services are, in principle, subject to the law of the Member State in which the service provider is established. In turn, the Member State in which the service is received cannot restrict incoming services except in strictly limited circumstances and subject to a specific procedure laid down in the Directive.

VAT Distinction between goods and services For goods, VAT is charged on an origin basis within member states (countries), For a supply between member states the supplier does not charge VAT and the buyer has to pay it by a reverse-charge mechanism (and can offset it against output tax). Individuals and non-registered traders buying goods across borders will pay the origin tax concerned. Imports of goods from outside the EU are charged with destination VAT at the time of importation. For services, there is also an origin basis for trading within member states Services delivered from outside the EU to a registered trader will normally give rise to a reverse-charge tax liability, again deductible for the importer. E-commerce naturally assists suppliers to avoid the need for a fixed establishment in a member state

Obstacles Legal uncertainty exists with regard to the extent to which Member States may control services originating from another Member State Lack of trust mark scheme (accredits codes of conduct for e-commerce that reach an agreed minimum standard)

Our experiences The transpostion of ECD was one of the issues connected with EU acces process The Slovak government has delayed proceedings through the need for further consultation on the legal framework of the Directive's requirements The first version of ECD was too generally oriented Experts from E- commerce was not involved

Suggestions Take in consideration that the area of transposition of ECD has a cross-sectional nature and affects to all related directives The global nature of the Internet means that responsible body (ministery) will also need to strengthen dialogue with experts from e - commerce branch, so that required rules can be drawn up where necessary

Inspection The compliance with the Law is supervised by the Slovak Commercial Inspection Authority (SCIA). The SCIA plays the role of contact point providing information and assistance in this area to the respective authorities and professional bodies (institutions, associations, etc.) in other Member States The Ministry of Economy of the Slovak Republic is the place that provides assistance and information to the Commission and the state authorities of the Member States as well as to the providers and recipients of these services

Before the the transposition To find the right balance between strategic political bargaining and practical commercial relevance Communication between responsible ministery and e commerce experts is necessery To equalize the the paper and electronic transactions Discussion on the web Transposition of other directives concerning electronic commerce

Directive 97/7/EC of the European Parliament and of the Council on the protection of consumers in respect of distance contracts Council Directive 93/13/EEC on unfair terms in consumer contracts, transposed into the Consumer Protection Law 634/1992 of the Collection of Laws and into the Civil Code Directive 2002/21/EC on a common regulatory framework for electronic communications networks and services, Directive 2002/58/EC on privacy and electronic communications and other acts Directive 2002/21/EC on a common regulatory framework for electronic communications networks and services, Directive 2002/58/EC on privacy and electronic communications

Transposition of other directives concerning electronic commerce Directive 1999/93/EC on a Community framework for electronic signatures Council Directive 84/450/EEC on misleading and comparative advertising, implemented by means of the Advertising Law No. 147/2001 of the Collection of Laws Directive 2002/65/EC of the European Parliament and of the Council concerning the distance marketing of consumer financial services and amending Council Directive 90/619/EEC and Directives 97/7/EC and 98/27/EC Directive 2005/29/EC of the European Parliament and of the Council concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC Directives 97/7/EC, 98/27/EC and 2002/65/EC of the European Parliament and of the Council and Regulation (EC) No 2006/2004 of the European Parliament and of the Council.

B2B In the Slovak Republic, B2B (business to business) and B2C (business to consumer) electronic commerce is common Agreements are concluded and goods supplied in accordance with the ECD and the Law on protecting consumers involved in door to door sales and mail-order sales. Also quite common are electronic payments by means of cards, possibilities of making use of consumer credits by means of credit cards, and even sophisticated payments via mobile phones, online payments between banks and individual institutions and enterprises, and payments between enterprises based on a contractual relationship under certain terms and conditions by means of a bank. This is the simplest form of e-commerce, which is why it is most widespread in the Slovak Republic. In the bank-client system, the electronic communication takes place via a certain PIN

Electronic signature With the explosion of e-commerce, the "paperless office" should surely already have become a reality in near future Trust in electronic business transactions to be reliable, provable and enforceable, even on an international basis In the area of e-commerce, the conditions in the Slovak Republic are similar to those in force in the EU Electronic communication using electronic signature is also used between enterprises, suppliers and customers (EDI system supported mainly in Europe) The EDI system is not fully appropriate for small and medium-sized enterprises as it requires an expensive infrastructure that cannot be afforded by small and medium-sized enterprises. At present, the main focus is aimed at e-cash in relation to the preparations for the introduction of the Euro in the Slovak Republic.

Implementing the ECD establishment of service providers, commercial communications, electronic contracts, the liability of intermediaries, codes of conduct court actions, and cooperation between member states

Conclusion With the massive explosion of e-commerce, and especially the use of the Internet as a transnational and instant medium for business transactions,requires common practices E-commerce has now become a key component of many organizations in the daily running of their business The implementation of the ECD released in early 2004 revealed that the rules have increased interest in online services throughout the country, boosting the number of internet users expected to shop online by 2008 to 34%.

The steps for the development of e commerce in Slovakia Trust increase Better Informatio ns For customer Better informations Better conditions Training New possibilities Development Cerification trustmarks Media informations Market research Legislative lobbing Seminars Workshops Third Party cooperation