Singapore Passes 2010 Electronic Transactions Bill
Second Reading Speech on the Electronic Transactions Bill 2010 by Mr Lui Tuck Yew, Acting Minister for Information, Communications and the Arts, 19 May 2010.
Mr Speaker, Sir, I beg to move, “That the Bill be now read a Second time”.
Introduction
This Bill seeks to repeal and re-enact with amendments the existing Electronic Transactions Act, or ETA for short, to maintain its relevancy in a rapidly changing digital world. It ensures that, going forward, the ETA will continue to fulfil its fundamental role of providing a conducive legal framework for electronic transactions to take place in Singapore.
In doing so, we can facilitate the continual growth of electronic commerce (or e-commerce for short), electronic communications and electronic transactions, hence strengthening Singapore’s position as a trusted global infocomm hub.
This is of strategic importance given the increasing use of the electronic medium for communications and transactions, and substantial growth in global e-commerce trade. According to comScore, a global market research company, US e-commerce trade reached a total of US$130 billion in 2009 and is expected to grow by almost seven percent this year.
Closer to home, Singaporeans increasingly go online to purchase goods, procure services and transact with the Government.
Based on the annual e-Government perception survey conducted in 2009, almost nine out of ten users who transacted with the Government did so electronically at least once a year.
For the ETA to effectively play its role, we will need to ensure that it remains aligned with global developments on the rules of conducting electronic transactions, and be capable of adapting to constant technological change.
A comprehensive review of the ETA was therefore conducted to identify aspects of the legislation which required amendments.
Mr Speaker, Sir, the review had identified three sets of amendments to the ETA, which are presented in this Bill. They include:
- First, amendments to align the ETA with the UN Convention on the Use of Electronic Communications in International Contracts (or the UN Electronic Communications Convention for short);
- Second, amendments to the ETA to facilitate more effective delivery of e-Government services in Singapore; and
- Third, amendments to the Certification Authority regulatory framework enshrined in the ETA to enhance the technology neutrality of the legislation.
In addition to these amendments, a substantial restructuring of the ETA has also been proposed in order to streamline the Act, and facilitate future amendments in response to technological developments. Since the existing ETA needs to be extensively re-arranged and amended in order to accommodate the proposed changes, we therefore seek to repeal and re-enact with amendments the ETA.
UN Convention on the Use of Electronic Communications in International Contracts
Let me now move on to elaborate on the three sets of amendments to the ETA, starting with the alignment of the ETA with the UN Electronic Communications Convention. Developed by the United Nations Commission on International Trade Law (or UNCITRAL for short) Working Group chaired by Singapore, the UN Electronic Communications Convention is an updated international legal framework for e-commerce that takes into account developments brought on by the Internet and other technological advances. It seeks to facilitate global e-commerce trade by establishing a set of comprehensive rules to guide the use of electronic communications in the negotiation and formation of international contracts.
This Bill seeks to amend the ETA for consistency with the rules under the UN Electronic Communications Convention. Existing provisions in the ETA, such as those responsible for defining the time and place of despatch of an electronic communication, will hence be amended to follow the UN Electronic Communications Convention. New provisions that are currently not in the ETA will also be added. These new provisions include rules on the use of automated programmes in the formation of contracts, use of electronic originals in place of the physical originals, and clarifications on the rules in a formation of an electronic contract. These amendments are necessary for Singapore’s legal frameworks to keep pace with international developments on the laws of e-commerce.
In addition, by harmonising our laws on e-commerce with the UN Electronic Communications Convention, businesses in Singapore will not be subjected to different standards for domestic and international transactions. This prevents any complication arising from different definitions and conventions between local and cross-border electronic transactions.
E-Government
The second set of amendments to the ETA is aimed at facilitating effective delivery of e-Government services. Since the start of Singapore’s e-Government journey some thirty years ago, the Government has consistently sought to improve public e-services for the benefits of citizens and businesses.
This Bill supports our e-Government efforts by enabling the greater use of electronic documents and transactions in citizens’ and businesses’ interactions with public agencies.
Use of Electronic Forms and Intermediaries
It is proposed that the ETA be amended to clarify that during transactions with public agencies, information can be submitted using electronic forms in the manner specified by the agencies, even if these forms do not resemble the physical prescribed forms required for the transactions. The amendments are proposed to provide flexibility for public agencies to design electronic forms suited for online transactions, and hence improve the customer’s overall e-Government experience.
For example, public agencies can create integrated electronic forms to facilitate a user’s performance of multiple e-Government transactions from a single point of access. Using the integrated electronic form, the user needs to input his relevant information just once, instead of having to fill in the same information repeatedly in the multiple forms for the different e-Government transactions he is performing. This saves time and effort on the user’s end, and improves overall efficiency in the delivery of e-Government services.
Retention of Records and Provision of Originals
The other e-Government related amendments to the ETA are aimed at facilitating the Government’s push towards paperless public service delivery. Under some laws, Government agencies will require individuals or businesses to retain certain records for the purposes of inspection or for future reference. Some Government agencies may in other cases require original documents to be produced as part of an application process. The proposed amendments seek to establish that for such requirements, Government agencies will, by default, accept the retention or provision of the required documents in their electronic form.
These amendments are recommended in view of the trends and merits in the use of electronic documents. As technology becomes available to safeguard the integrity of electronic documents, it has become increasingly common for businesses and individuals to convert, and create, their paper records and originals in electronic form. This is a more attractive alternative since paper documents are bulky, and generally, cost more to physically store and manage.
There may be situations where public agencies will require electronic documents to be retained or submitted in a particular manner. These requirements are necessary for various reasons – for instance, to ensure that the information can be properly processed by the system or to facilitate efficient processing of the documents. Hence, there will be provisions in the ETA to allow Government agencies to specify additional requirements for the retention or provision of electronic records and originals.
Exclusions from ETA
It is worthwhile to highlight that the ETA will not apply to all forms of electronic documents and transactions. When the ETA was enacted in 1998, it was recognised that there were certain classes of documents and transactions, such as wills and the conveyance of properties, which were not ready for the transition into the electronic medium. A decision was then taken to exclude them from the ETA.
During the review, we had sought feedback on whether these exclusions should continue to be maintained given technological developments and growth in public confidence in the use of electronic documents and transactions. Based on the responses to the public consultation exercises, there is a general agreement that the exclusions should be maintained. We concur, and view that the reasons for having the exclusions continue to be valid in today’s context. Negotiable instruments and documents of title, for example, continue to be excluded because there is no internationally recognised standard for ensuring their uniqueness in the electronic environment. We also note that the exclusions are commonly adopted in other jurisdictions.
There will hence be no change made to the classes of documents and transactions excluded from the ETA. The amendments to the list of exclusions presented in this Bill are merely additions that highlight the specific examples of documents and transactions excluded from the legislation. They are meant to provide greater clarity on the exclusions and for consistency with the UN Convention.
With these exclusions, parties cannot rely on the ETA to satisfy the legal requirements, such as the need for writing or signatures, stipulated for the excluded classes of documents and transactions. However, parties are not prevented from conducting these excluded matters electronically. For instance, the Singapore courts have recognised the use of electronic communications in agreements for the conveyance of land. Similarly, the exclusion of certain matters under the ETA does not invalidate the use of their electronic versions if they are deemed valid under other rules of law, such as in the Rules of Court for the e-filing of Court documents.
Certification Authorities
Sir, I will now touch on the last set of amendments, which seeks to amend the regulatory framework for Certification Authorities (or CAs for short) to enhance the technology neutrality of the ETA.
Technology Neutral Approach
The current CA regulatory framework enshrined in the ETA is largely based on Public Key Infrastructure (or PKI for short) technology. As this was one of the most secure authentication architectures at the time, we had used PKI technology as the benchmark for the integrity and security of authentication services offered by CAs in e-commerce transactions.
Since then, new security technologies and solutions have emerged, and changed the authentication and security landscape both in Singapore and globally. Some of these new technologies like biometrics have begun to be adopted, as they have been found to be appropriate alternatives to PKI. To keep pace with these industry developments, we have proposed to remove PKI-specific references from the ETA. Requirements and details relating to specific technologies, whether current or new, will instead be provided in the ETA Schedules and various regulations made under the Act.
The effect of these proposed amendments is that proven new security technologies can now be treated as comparable to PKI in ensuring the reliability and security of authentication services.
We have also ensured that there will be no dilution in the regulatory controls that have been put in place to govern CAs in Singapore. For example, the Minister still retains the powers to issue regulations to safeguard or maintain the effectiveness and efficiency of CA services. The Controller appointed by the Minister also retains enforcement powers over CAs, and has additional powers to issue directions requiring CAs to work with public and civil bodies for national emergency purposes.
Conclusion
In summary, this Bill proposes to harmonise our laws on electronic transactions in line with international developments, and hence provide a conducive legal framework for e-commerce trade to flourish in Singapore.
It also amends the ETA as part of our continual efforts to improve the delivery and use of e-Government services. Lastly, enhancements to the technology neutrality of the ETA will allow us to better respond to the ever-changing and continued developments in security technologies.
Overall, the new ETA will facilitate the increased adoption and use of infocomm technology as a productivity tool, and at the same time, buttress Singapore’s position as an international infocomm hub.
Sir, I beg to move.
Topics: 2010, Arts, business, communications, community, comScore, e commerce, e government, economic development, economic growth, economic recovery, Economy, electronic commerce, electronic contract, electronic transactions, Electronic Transactions Bill 2010, employment, ETA, Governance, government, infocomm, information, internet, jobs, legal framework, Lui Tuck Yew, moniter, monitor, news, online, safety, security, Singapore, society, technology, trade
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