2. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net (Electronic) Payment

3. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net One upon a time...... There was money They disappeared long before the financial crisis We had nice documents

4. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net Forget the e Payment is payment Almost all payments are executed by electronic means

5. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net What is payment? Distinguish between payment and invoicing Payment is transfer of funds form a payer to a payee A system that only register invoicing information is not a payment system

6. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net 5. "payment transaction" means an act, initiated by the payer or by the payee, of placing, transferring or withdrawing funds, irrespective of any underlying obligations between the payer and the payee

7. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net What is money? Money is not technology! A strictly legal definition: –F.A. Mann: The legal aspect of money, p. 8: –“It is suggested that, in law, the quality of money is to be attributed to all chattels which, issued by the authority of the law and denominated with reference to a unit of account, are meant to serve as universal means of exchange in the State of issue.”

8. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net An economic definition: –Funds that function as money

9. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net Money - continued UNCITRAL Model Law on International Credit Transfers, Art. 2h: –“"Funds" or "money" includes credit in an account kept by a bank and includes credit denominated in a monetary unit of account that is established by an intergovernmental institution or by agreement of two or more States, provided that this law shall apply without prejudice to the rules of the intergovernmental institution or the stipulations of the agreement;”

10. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net Directive 2007/64/EC Art 4 –15. "funds" means banknotes and coins, scriptural money and electronic money as defined in Article 1(3)(b) of Directive 2000/46/EC;

11. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net An inportant distinction Funds –15. "funds" means banknotes and coins, scriptural money and electronic money as defined in Article 1(3)(b) of Directive 2000/46/EC Payment instrument –23. "payment instrument" means any personalised device(s) and/or set of procedures agreed between the payment service user and the payment service provider and used by the payment service user in order to initiate a payment order

12. Cash payment Tranport of valuable goods

13. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net What is the relevance? We pay by transfer of a claim or by establishing a claim with the payee as creditor. The law that relates to monetary obligations and transfer of these, are not the same as the law that relates to transfer of physical property.

14. From two parties

15. To three two-party transactions Seller Buyer

16. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net Two payment situations Independent payment –Paying of bills Payment against delivery –Electronic commerce

17. Credit transfer

18. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net Payment order - Directive 2007/64/EC art. 4 16. "payment order" means any instruction by a payer or payee to his payment service provider requesting the execution of a payment transaction

19. Debit transfer

20. Debit Transfer - risk

21. Debit Transfer - Encrypted

22. Debit Transfer - Certificates

23. Cash payment Tranport of valuable goods

24. From two parties

25. To three two-party transactions Seller Buyer

26. Credit transfer

27. Debit transfer

28. –I am Donald Duck Debit Transfer - Encrypted

29. Debit Transfer - risk

30. Debit Transfer - Encrypted

31. –I am Donald Duck Debit Transfer - Encrypted

32. Debit Transfer - Certificates

33. Debit Transfer – More than one bank

34. Credit Transfer

36. Deterritorialisation Seller Buyer

37. Reterritorialisation Seller Buyer

38. Reterritorialisation Seller Buyer

39. Reterritorialisation Seller Buyer

42. Reterritorialisation Seller Buyer

43. Reterritorialisation Seller Buyer

44. E-cash

46. E-cash – More than one bank

47. Smart Card based “Electronic Money”

49. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net “Electronic Money” – some situations Pre-payment of services with one service provider –Phone cards –Tickets –Parking –Etc Pre-payment of services with more than one service provider –How do you distribute the payment among the service providers?

52. © Olav Torvund - SENTER FOR RETTSINFORMATIKK UNIVERSITETET I OSLO http://www.torvund.net End to end micropayment will never happen Pool-based clearing – portals are needed