Consumer Based Electronic Commerce: A Comparative Analysis of the position in Malaysia and Hong Kong

Although consumer electronic commerce is growing at a significant rate, a number of stumbling blocks continue to hamper its development. One stumbling block relates to ensuring the trust and confidence of consumers and businesses alike. For electronic commerce to develop, both consumers and businesses must be confident that transactions conducted electronically will not be modified or intercepted. They need to know that they are safe from ‘cyber’ theft and fraud. There must be some assurance that a trustworthy mechanism exists to ensure that security is not compromised. In addition to the security of electronic transactions, consumers’ confidence can be further enhanced if information on electronic transacting is made more transparent. This will assist consumers in making informed and consensual decisions. Contract formation also tends to raise problems. Parties might disagree as to what point a contract is formed. This issue, too, needs to be addressed to enhance the integrity of this new mode of procuring goods and services.

This article considers these issues in the context of recent legal developments in Malaysia and Hong Kong designed to enhance consumer electronic commerce. These two jurisdictions have been chosen for the purposes of the case study because they provide two representative examples of how common law East Asia is tackling the challenge of how to facilitate growth in consumer electronic commerce.

This article first identifies the issues raised by contracting on line with a particular focus on principles of contract formation, consumer protection and security of on line transactions. It examines the principles on formation of contract adopted in the UK and the issue of consumer protection raised in the UCTA and the EU Directives on Distance Contracts and Electronic Commerce. It then looks at the relevance of these provisions to Malaysia and Hong Kong. The article next looks at the extent to which the spirit of the UNCITRAL Model Law has been adopted in Malaysia and Hong Kong with regard to electronic signatures. It considers the principles drawn from the Utah Digital Signature Act and compares that with the Digital Signature Act 1997 of Malaysia with the Electronic Transactions Ordinance 2000 of Hong Kong. The article finally discusses whether the governments in Malaysia and Hong Kong have taken sufficient steps to ensure that consumer based electronic commerce is set to flourish in the near future.