Symbiosis Law School, Pune.

SKILL BUILDING INTERNAL: Do’s and

Don’ts of E-Commerce Transactions.

SARIKA SOUMYA
Diploma in Cyber Laws

Semester II

PRN: 16010169021
 CONTENTS
Topic Page No.

I. Introduction……………………………………………………………………..3

II. Legal Issues Revolving Around E-Commerce…………...……………….……….3

III. Do’s and Don’ts of E-Commerce Transactions………….……………...................7

IV. E-Commerce and Cyber Crimes…...……………………………………...……8

V. Conclusion…………………………………………………………………...….....10

VI. Bibliography…………………………………………………………………….11

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 A. INTRODUCTION
The early struggles with the internet were finding a way to safely buy and sell goods
or transfer funds using computer and telecommunication networks. The goal was to
enable e-commerce by providing a safe, convenient and immediate payment system
on the internet. But internet is notorious for giving its users a feeling of anonymity.
The inadequate security results in major damage. Now a day a number of critical
transactions are carried out by computer systems over networks. There is an internet
security threat - cyber crime which enables ecommerce transaction face significant
financial and information losses.
Approximately 100 countries now enjoy Internet access, and a recent survey reported
that there are approximately 20 million Internet hosts worldwide. The number of
Internet users is currently estimated to be in the region of 100 million people.1
E-commerce presents a world of opportunity for doing businesses, reaching global
markets and purchasing without leaving the home or office. E-commerce can provide
opportunities to improve business processes, just as phones, faxes and mobile
communications have in the past. However, just as any new business tool has
associated issues and risks so does e-commerce. It's important to understand the legal
issues and potential risks to ensure a safe, secure environment for trading with
customers and other businesses.
The issue of law on the Internet is a complex one. Between the two all-or-nothing
extremes lies a broad spectrum of possibilities 2. Many people revel in the freedom to
express themselves and the freedom from prohibitions such as zoning restrictions that
the Internet apparently affords. With no law at all, however, the Internet would be no
place to conduct business or pleasure. Laws give people certainties about their rights
and responsibilities: they make life more predictable.

B. LEGAL ISSUES REVOLVING AROUND E-COMMERCE

a) Electronic Transaction
Some federal, state and territory governments encourage the adoption of electronic
commerce by enacting and enabling legalisation. In Australia many bills and acts
have been passed to resolve legal issues and make electronic transaction more

1
 Bond, Robert, "International Legal Issues of E-Commerce" Legal Updates, http://www.faegre.com
2
Sayer, Peter and Deveaux, Sarah, "Jurisdiction in Cyberspace" IDG News Service Friday, July 28, 2000 see
also http://www.pcworld.com

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 authenticated, such as the Electronic Transaction Act (ETA) 3. ETA enables
contractual dealings, such as offers, acceptances and invitations, to be conducted
electronically, and also allows people to use an electronic signature to satisfy any
legal requirement.
Moreover the bill is expected to boost electronic commerce as an effective tool for
businesses to increase their efficiency. New legislation brings some questions such
as, For how long will these acts be valid? What are the boundaries of these acts? Who
should be forced to follow the rules? Most of these questions are unanswerable today.
By applying laws and sketching boundaries around the borderless Internet do we
negate the term "freedom of information"? How will legal structure affect
international transactions on the Internet? Will it restrict the potential growth of the
Internet prematurely? Rapid changes in technology do not allow enforcement of
specific laws in cyberspace. For now many organizations are promoting global
coordination of legal structures4.
b) Privacy & Security
While shopping on the Internet, most people typically do not think about what is
happening in the background. Web shopping is generally very easy. We click on a
related site, go into that site, buy the required merchandise by adding it to our cart,
enter our credit card details and then expect delivery within a couple of days. This
entire process looks very simple but a developer or businessmen knows exactly how
many hurdles need to be jumped to complete the order. Customer information has to
pass through several hands so security and privacy of the information are a major
concern. The safety and security of a customer's personal information lies within the
hands of the business. Therefore businesses have to give the customer first their
guarantee, and second peace of mind, that the information passed over is of no risk to
any invading eyes.
Many people are not willing to disclose their personal information on the Web. It is
up to individuals to decide how much personal information they are willing to
disclose and how it might be used. Interestingly, one survey found that many people
who disclose personal information do so in hope of financial benefit, such as winning
a sweepstakes.5
3
Western Australia Dept of Industry and Resources, http://www.law.gov.au/www/securitylawHome.nsf/
4
Barr, David D. "The Need of a Broad Standard in Global E-Commerce" The Internet Law Journal, Dec. 26,
2000
5
"Law, Ethics and Cyber Crime" Prentice Hall 2003

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 c) Copyright & Trademark
Many attempts have been made to address the issues related to copyrights on digital
content. E-commerce has a tremendous impact on copyright and related issues, and
the scope of copyrights is affecting how e-commerce evolves. It is essential that legal
rules are set and applied appropriately to ensure that digital technology does not
undermine the basic doctrine of copyright and related rights. From one perspective,
the Internet has been described as "the world's biggest copy machine"6. Older
technologies such as photocopying, recording and taping are bound by rules and
regulations regarding quantity, content, quality and time constraints. In contrast, on
the Internet one person can send millions of copies all over the world7.

d) Online Terms, Conditions, Policies and Laws

Privacy legislation is designed to protect a person's personal information. The privacy
laws of their host country affect overseas companies. Every organisation should be
very careful while applying terms and conditions for the electronic transaction for
Internet users. Privacy and security policies not only reflect the organizations practice
but also the rules and regulations for doing business with the company. Major issues
regarding the legalization of electronic transactions include the following.

— Ensure proper online contracts.

— Record retention obligations.

— Original documentation, in terms of TAX and VAT requirements.

— Import/export regulations.

— Exchange control regulation.

— Foreign data protection law.

e) Legislation Dilemma
6
"Its the World's Biggest Copy Machine," PC Week, January
7
"Intellectual Property on the Internet", A survey of issues. [Copyrights and Related Issues],
http://ecommerce.wipo.int/survey/

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 Electronic transactions separate e-business from traditional types of businesses. When
a transaction takes place, Who has jurisdiction? Who has the authority to apply law
over the transaction?
A little legislation can go a long way toward helping parties to establish better
boundaries to work within. When a transaction that takes place between two different
parties located in two different countries goes wrong then a number of complex
questions arise.
Felix Somm, ex-manager of CompuServe Deutschland, was cleared on appeal of
pornography charges brought against him in Germany after newsgroups carried on
parent company CompuServe's US servers were found to contain pornographic
material. The judge determined that it was technically impossible for Somm to close
the illegal newsgroups in question8. Following in the footsteps of the CompuServe's
case, Yahoo is arguing that it would be technically impossible to block only French
citizens from access to its online auctions if should the auctions contain objectionable
items.
f) E-Business and Legal Issues

The technological basis of e-commerce is basically Web client/server middleware, or

what is called three-tier architectures. The client tier is the Web browser involving
some type of form processing. The middle tier is the Web server, often with
transaction processing. The Web server in turn links to the third tier, a database
processing the order information. Some of the issues are strictly Internet-related, such
as domain names and trademarks, linking and framing, clickware (and shrinkware),
and metatag use. Others are traditional issues applied to the Internet, such as
copyright, contracts, consumer protection, privacy, taxation, regulated industries and
jurisdiction.

E-commerce site development, its advertising, electronic transaction, money

transactions and such involve many legal issues, which need to be taken into account
step by step. Before developing an e-commerce site a registered domain and a
registered trademark should be established. There must be some copyright protection
on the site. The business must ensure that it displays the terms and condition/policies
within its site. Security involving the privacy of a user's data is always one of the
8
 Sayer, Peter and Deveaux, Sarah, "Jurisdiction in Cyberspace" IDG News Service Friday, July 28, 2000

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 main concerns while doing business online. Defining rules and regulations for the
advertisement of the site by placing banners on other known sites is another. It is of
great value when dealing with such complex issues to consult an attorney who
specializes in the issues of cyberspace.

C. DO’S AND DON’TS OF E-COMMERCE TRANSACTIONS

E-Commerce DO’s:

 Use Detailed Descriptions: When I shop online, I do not have the luxury of touching
or closely inspecting an item before I make a purchase. I look for product descriptions
that include high-quality images. Having images taken from different angles and both
inside and outside the package is critical to securing a sale.
 Organized Search: I love a website that is laid out in an organized fashion. Stores
that sort items into logical categories are my favorites. I want a search function that
works effectively. Yesterday, I was looking to price a post hole digger that I could
buy online and pick up locally. After typing in “post hole digger” on one site, the first
ten items included fence posts, t-post clips, and t-post caps. I simply didn’t care to try
to decipher their system and left the site.
 Suggest Other Items: I look for sites that offer upsells at the time of checkout. I
purchased a gate a few weeks ago and chose an item that said “hardware included.” It
arrived and the instructions say “some hardware included.” Now, I have to wait for
the hardware that wasn’t included. Had the e-commerce store told me that I needed
these additional items when I checked out, I’d be much happier.
 Make Security a Priority: I’ve had two credit/debit cards fall prey to stores that
didn’t protect their customers. I’m still disturbed by how lax some e-commerce sites
are when it comes to security. I will not shop at sites that do not use SSL security, that
store my credit card without asking me first, or that don’t use the three or four digit
security code on the back of a credit card. I love having the option of paying with a
third-party payment processor like PayPal. If a store doesn’t care about making the
shopping experience safe for me, I don’t care to give them my business.
 Test Links: There is an online retailer that’s been around for decades. That store is on
the verge of bankruptcy, and I know one of their biggest issues. When I try to shop at
that store, I’ll click on a link to look at an item and get a “page cannot be displayed”

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 message. It’s frustrating to have to find where they moved the page. The web design
team fails to test links, and it’s a key reason I don’t bother going to that retailer’s
website.

E-Commerce Don’ts:

 Bury Shipping Charges: The key reason I abandon a purchase is shipping fees. If a
store isn’t willing to give me an idea on how much shipping is going to cost before I
start filling in my address and payment information, it’s not worth my time.
 Make False Promises: I once purchased from a site that promised easy returns. The
item arrived without the charger cable, so I had to return it. They informed me that I
must pay the return shipping costs, that I could only return it using UPS, and that I
could not use UPS home pick-up service. Having to drive miles to the nearest UPS
office did not meet my expectations of an easy return.
 Skimp on Customer Service: I cannot stand for e-commerce sites that only offer
customer service through the telephone. I don’t have time to wait on the phone.
Instant chat or quick email support is ideal for my busy schedule. I also dislike getting
routed to another country where the customer service reps have a thick accent that
makes it impossible for me to understand what they’re saying.

D. E-COMMERCE AND CYBER CRIMES

 Unauthorized access to computer systems or networks
This kind of crime is normally referred as hacking. Hacking is a computer crime in
which the criminal breaks into a computer system just for challenge of doing so.
However the framers of the information technology act 20009 have no where used this
term so to avoid any confusion we would not interchangeably use the word hacking
for ‘unauthorized access’ as the latter has wide connotation.

 Data Alteration or Theft Most common type of cyber crime.

9
Information Technology Act, 2000.

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 The term Data Alteration or theft means making illegal changes or stealing data.
There have been a growing number of cases of data alteration or theft over the past
few years. Many measures are adopted in many organization with laws been set up.

 E-Mail Bombing
In Internet usage, an e-mail bomb is a form of net abuse consisting of sending huge
volumes of e-mail to an address in an attempt to overflow the mailbox or overwhelm
the server where the email address is hosted in a denial-of-service attack. Mass
mailing consists of sending numerous duplicate mails to the same email address.
These types of mail bombs are simple to design but their extreme simplicity means
they can be easily detected by spam filters. List linking means signing a particular
email address up to several email list subscriptions. The victim then has to
unsubscribe from these unwanted services manually.
 Data Diddling
Data diddling is the performing unauthorized modifications to data stored within the
computer system system. Examples include forging or counterfeiting documents used
for data entry and exchanging valid disks and tapes with modified replacements.
 Salami Attacks
This kind of crime is normally prevalent in the financial institutions or for the purpose
of committing financial crimes. An important feature of this type of offence is that the
alteration is so small that it would normally go unnoticed. E.g. The Ziegler case
wherein a logic bomb was introduced in the bank’s system, which deducted 10 cents
from every account and deposited it in a particular account.
 Web Jacking
This term is derived from the term hi jacking. In these kinds of offences the hacker
gains access and control over the web site of another. He may even mutilate or change
the information on the site. This may be done for fulfilling political objectives or for
money. E.g. recently the site of MIT (Ministry of Information Technology) was
hacked by the Pakistani hackers and some obscene matter was placed therein.
 Spoofing and Phishing
In the context of network security, a spoofing attack is a situation in which one person
or program successfully masquerades as another by falsifying data and thereby
gaining an illegitimate advantage. Today lot of Email is sent to many people where

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 the mail source identity is changed. E mail spoofing is very dangerous and it is a
potential privacy infringer.

E. CONCLUSION
Buying and selling online raise legal challenges that have to be addressed by both
Governments and the industry itself. Even in developed regions with a certain degree
of legal harmonization, such as the European Union, different legal requirements set
in national laws can hamper e-commerce. While there has been significant progress in
the adoption of laws, and to some extent legal harmonization in many regions, there is
still a need to align laws with leading international legal instruments to favour cross-
border ecommerce. Furthermore, several Governments, especially in developing
countries, need to adopt baseline laws in legal areas where they do not exist. In doing
so, developing countries should coordinate among institutions tasked with different
legislation on e-commerce, cloud computing and e-government to adopt common key
principles that will facilitate the delivery of all these services. Governments of
developing countries will also need to ensure the enforcement of laws – the next great
challenge awaiting them – both domestically and across borders.
To support the efforts of developing countries, assistance from the regional
integration communities and development partners in general should be sought to
ensure compatibility of laws to foster cross-border e-commerce. Long-term capacity-
building programmes should also be addressed to ensure law enforcement and
ultimately the use of e-commerce.

BIBLIOGRAPHY

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Books

 "Law, Ethics and Cyber Crime" Prentice Hall 2003

 "Its the World's Biggest Copy Machine," PC Week, January

Journal

 Barr, David D. "The Need of a Broad Standard in Global E-Commerce" The Internet
Law Journal, Dec. 26, 2000

News

 Sayer, Peter and Deveaux, Sarah, "Jurisdiction in Cyberspace" IDG News Service
Friday, July 28, 2000

WEBLIOGRAPHY
 Bond, Robert, "International Legal Issues of E-Commerce" Legal Updates,
http://www.faegre.com
 Sayer, Peter and Deveaux, Sarah, "Jurisdiction in Cyberspace" IDG News Service
Friday, July 28, 2000 see also http://www.pcworld.com
 Western Australia Dept of Industry and Resources,
http://www.law.gov.au/www/securitylawHome.nsf/
 "Intellectual Property on the Internet", A survey of issues. [Copyrights and Related
Issues], http://ecommerce.wipo.int/survey/

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