Jurisdiction - China
Reports and Analysis
China – E-Commerce Laws Will Not Be Updated For At Least Five Years, Government Official Says.

8 July, 2012



A law governing e-commerce in China will not be introduced for at least five years, a Chinese Government official has said.


Lin Junqiang, deputy director of the Information Centre at the Industry and Commerce Ministry in Beijing, said that China needed to develop a new overarching e-commerce law to respond to a rapid growth in online trade. He added that a new law could also help curb a rise in lawsuits facing businesses in China, but that it would be a "long time" before such a law comes into force.
"There is a developing trend in e-commerce across the globe," Junqiang told the E-Commerce Law & Policy publication. "All countries are facing the same sudden increase, so it is necessary to develop nationwide regulation to control the illegal behaviour that comes with this increase."
"The Government wants to develop a new e-commerce law because of the fast increase in e-commerce and with that the increase in e-commerce related problems. Chinese businesses see a rise in law suits and there are more and more user complaints," Jungiang added. "The Government is trying to find technical methods to solve these problems and that is why we are communicating with people in the UK who are doing the same job and who are facing the same problems."
"In China, we first make the regulations and then the law. It will take a long time, at least another five years. In the meantime the regulations can control the situation until the law is ready," Jungiang said.
Delegations from China have recently visited Japan, Germany, the UK and US to assess their respective legal frameworks around e-commerce issues. Jungiang said that he thought e-commerce in the UK and Germany was the most "developed" in Europe and that China would develop a prescriptive e-commerce law, like the one in Japan, than follow the "broad system" that operates in the US.
A complex range of Presidential decrees, central Government regulations and provincial law frameworks currently govern issues such as domain names, data protection, consumer rights, electronic signatures, telecommunications, online content, e-contracts, IT security, internet access and copyright in China.
Jungiang said that internet service providers (ISPs) in the country have a "duty" to help the Chinese Government monitor and enforce compliance with existing laws and that ensuring individuals' enter their details "correctly" when registering with websites was at the top of its current agenda.
"Internet service providers have a duty to assist the Government, to close websites if the Government asks them to, but internet service providers cannot do the job alone as it is very difficult to monitor the whole online space," he said.
"We are currently trialling an approach in a number of different provinces. The approach is aimed at making sure that all citizens’ online registration details are correct. We will then spread this approach across the nation gathering correct online registration information to a central government database, at which point we will gather feedback on the approach," Jungiang added.
Jungiang also outlined how existing Chinese laws protect consumers' rights to refunds from purchases made online and how it is not the Chinese Government's direct responsibility to ensure consumers' personal information rights are adhered to.
"In China the payment method protects the consumer," he said. "A third party keeps the money during the transaction so if the product is faulty the money will not go to the supplier but back to the customer. There is also another way to pay, once a product is bought online a delivery driver brings the product to the customer who then checks the product and if they are happy with the item, they pay the delivery driver who then passes the money on to the supplier."
"Information protection is not a duty of the Chinese Government. Banks and similar institutions are responsible for protecting consumer data and the technology to do so is advanced. The Government has two roles in protecting private information. Firstly, it develops laws to protect private information, and secondly, the Government will take action against companies that disclose private information, which occurred recently on a national scale," Jungiang said.



For further information, please contact:
John Salmon, Partner, Pinsent Masons


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