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Bunkle's Address on E Commerce Code of Conduct

Hon Phillida Bunkle
Minister of Consumer Affairs

Address to E Commerce Code of Conduct Stakeholders
Turnbull House
01 June 2000
10am

Good morning and welcome! I have invited you here today to discuss an important topic – consumer protection in electronic commerce.

It will probably come as no surprise to you that I would ideally like to see appropriate measures put in place to ensure consumers have confidence in the electronic environment.

At the moment, I am not sure that consumers have that confidence and it's important that we - both government and industry - address this.

Consumers will have confidence when they are satisfied with four key areas.

 Knowing clearly who they are dealing with and what they are getting
 Security of Information
 Privacy
 Ability to solve any problems quickly and fairly.

Although I didn't need to invite you here to tell you this.

It is hardly possible to read an article or hear a news report about business to consumer electronic commerce without seeing references to these basic points.

And while it may seem that these issues are largely raised by consumer advocates, representatives or individuals, they are in fact more often than not, raised by businesses themselves.

We here in this room would all recognise the importance of appropriate consumer protection mechanisms. Consumer protection is good for the consumer, and business, alike. However, knowing that something is good and worthwhile is sometimes not enough.

This knowledge needs to be reinforced by action. Right now, we are seeking to do this by developing and implementing consumer protection that will build consumer confidence and support e-commerce as a business-to-consumer model.

Today is an important part of the developing stage – gathering your thoughts, your ideas, your criticisms, your fears, and your enthusiasm.

My Ministry released a report on Electronic Commerce in March this year that proposed a New Zealand Model Code of for Consumer Protection in Electronic Commerce.

As you will be aware, any action we take in New Zealand is limited to domestic transactions. However, the principles and standards in this Code draw heavily - as it should - on recently developed OECD guidelines. The Code is essentially the same as one announced in Australia not two weeks ago.

Obviously this means that action in New Zealand needs to be consistent with and support international developments that will ensure the growth of consumer confidence on a global scale.

Keith Manch will take you through some aspects of the Ministry's paper and the issues it raises shortly.

There are however, some issues I want to raise.

Prior to agreeing to the release of the report I discussed with my officials whether a self-regulatory approach would be sufficient to ensure that consumer interests are being protected. This discussion highlighted various issues that are referred to in the report. The first point is that:

 E-commerce is still relatively new and as we all know, consumer-to-business e-commerce is much less significant than business-to-business e-commerce.

To me this means that we now have the opportunity to put in place something that will set appropriate standards for consumer protection while at the same time, support the development of e-commerce.

Other points are:

 domestic law already applies to electronic commerce transactions that occur within New Zealand. Issues around electronic transactions conducted across the border are more complex.
 E-commerce is fast developing
 Business has strong incentives to ensure that consumers do have confidence
 E-commerce is global

These points are said to support the idea that self-regulation may be the way to go. Indeed, I have even been told that regulation for consumer protection in e-commerce is unnecessary, difficult to design, costly to administer and may restrict e-commerce development.

Frankly, I am not sure that I personally accept all of this.

What I do know is that as the Minister of Consumer Affairs I am determined that consumers should be appropriate protection whether they are shopping in traditional "bricks and mortar", "clicks and mortar" or "pure Internet" businesses.

I certainly hope that this meeting is productive in setting in place some good consumer protection mechanisms. While I am unable to stay for the entire meeting, I look forward to hearing about the progress being made.


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