Network: E-commerce policy requires more than quick thinking

IN BETWEEN sorting out the Irish peace process and denouncing dodgy European Commissioners, Tony Blair has found time to put his 10 pence worth into improving the lot of the online bargain-hunter. The Prime Minister has set the target for the UK to be the best environment for electronic trading by the year 2002.

Since more than 25 per cent of UK Net users have already shopped online, it would appear that e-commerce is doing pretty well without Tony's blessing. However, the Department of Trade and Industry has published a list of intended e-commerce legislation, and invites your comments by 1 April. It's good to see that the Government has discovered "web time", although the three-week consultation period is better suited to Silicon Valley venture capitalists than to Whitehall bureaucrats.

Up for discussion is the legal and technical process for the roll-out of electronic signatures (simply an electronic equivalent of manual signatures). If the very idea makes your eyes glaze over, spare a thought for the poor sods in the online sales business. They have to cope with a plague of "test" orders and "I've changed my mind" orders, or "I would like to pretend for 10 minutes that I want to go to New York" orders (a popular therapy among online travel shoppers).

Many online travel services are troubled by customers who book the cheapo flight to New York, then change their minds and cancel half an hour later. Meanwhile, the online travel agent assumes this ticket is sold, and takes it off the availability lists to avoid double-booking. By the time the customer has cancelled, the agent has missed the opportunity to sell the ticket to somebody else.

However, if electronic signatures were legally binding, the customer would be held accountable for orders and would take the process more seriously. This is a problem not just for online travel agents but for any fast-moving stock - CDs, clothes, books, hardware.

So the Government seems to be making the right point. Sorting out the electronic signature process would make bargain-hunting more enjoyable, as you would be sure you were looking at all the available items, not just what was left after the "testers" had taken the best offers. A solid system for electronic signatures would also allow you to get credit online (at the moment a written signature is the legal requirement), which is handy if there's something you like, but the pay cheque is weeks away.

The problem with the Government's proposal, though, is that it appears to be slightly schizophrenic. On one hand, the Government understands the necessity of electronic signatures, and is willing to support an agreed cryptography solution (that is, the technology behind the electronic signature encoding process). On the other hand, it wants new powers for law enforcement agencies to gain access to encrypted data. They want the police to be able to break encrypted messages if criminal activity is suspected.

The Government fails to understand that electronic signatures are tools of trust between customer and merchant. Inviting the police into that closely guarded relationship would be stretching that trust beyond what most people are prepared to accept. If I shop on Amazon.com, I don't particularly want the police to know about it. I'm happy for Amazon to sort out a digital signature system, but not to share that with law enforcement agencies, for fear of potential abuse of the system.

The technical aspect of electronic signatures will also be a major discussion point, as hackers abound and most sophisticated encryption systems can be broken, given enough computing power and hackers' talents for exposing code weaknesses. The Government correctly suggests that the law in this case should be technology-neutral, and recommends that licensed certification authorities be set up to offer that technical solution. But the very idea of a private authority holding data on my finances makes me shiver, as this situation is certainly open to abuse.

But hey! Who said that the future would be easy? The issue of electronic signatures must be resolved, but it also must be debated so we don't choose unworkable solutions. Giving three weeks' consultation time on such a complex issue seems a bit mean considering the implications.

Meanwhile, I personally would like to see the Government delivering on the promise that 25 per cent of its own dealings with citizens will be done online by 2002. I don't know how many weeks I have been carrying my council tax payment around in my bag, never quite posting it off. If I could pay that bill online, though, the Government would have saved a lot of money that is now being spent chasing me (and countless others like me).

If that "chase money" went into developing online tax collection, we would have a nice budget for a cutting-edge governmental e-commerce system. Submitting my general tax assessment online would be another wish, and paying the TV licence fee is on my list as well.

So it seems the Government has its work cut out without venturing into tricky areas such as electronic signatures. But it is no doubt more fun writing White Papers than slaving away on specifications for an online tax collection system. Meanwhile, if you want to comment on the proposal for electronic signatures, check out http://www.dti.gov.uk/ CII/elec/elec_com.html and mail your comments to Stephen de Souza (sec@ciid.dti.gov.uk).

eva@never.com