Do you believe the legal system specifically encourages or hinders digital services?
Malta, as a member state of the European Union, seeks to be compliant with EU legislation. By doing so, this also contributes to its aim to attract business and investment from foreign countries. The Maltese Government recognises that we are living in an increasingly digital world and realises that investment in digital services is essential. In fact, together with the Malta Information Technology Agency (‘MITA’), the Maltese Government provides its services and information by means of an electronic system. In 2016, by the Government of Malta launched a Cyber Security Strategy (the ‘Strategy’) with the aim to review current legislation and create legal and regulatory frameworks to cater for the Strategy’s goals such as securing cyber-space and combatting cybercrime. Moreover, the eIDAS Regulation which became directly applicable in Maltese law has paved the way for citizens and entities alike to be able to better access and utilise online services. Consequentially, the E-Commerce Act was amended by means of Act XXXV of 2016 to guarantee the effective implementation of such Regulation.
On a general note, the Norwegian legal system encourages the provision and use of digital services. As a result, Norway is considered an early adopter of new technology. Furthermore, Norway has implemented a large number of Acts governing the use of digital services and technology.
It also bears mentioning that the Norwegian Government has devoted its attention to the provision and use of new digital services provided by the sharing economy. On 6 February 2017, the government-appointed Committee on the Sharing Economy published their report on, inter alia, new technologies that might change the economy by; lowering the transactional costs associated with entering into contracts and complete transactions, creating new market- and business models, streamlining the utilisation of resources such as transportation vehicles, tools, or other property, and creating new employment opportunities. The Committee proposed several changes in legislation, and encouraged the Norwegian Tax Authority and the Ministry of Finance to examine these challenges.
We believe that our legal system encourages digital services by trying to keep up with the technological developments. While there are certain issues regarding taxation of digital service providers that are not located in Turkey, it is fair to say that the legal system is creating a safe environment which both protect the consumers and digital service providers.
Tensions exist among different laws which protect various interests, such as social warfare, freedom of contract, privacy and consumer benefits. As a national strategy, the state encourages the development of the internet and digital service industry which is called Internet Plus. In past a few years, the industry policies and laws favoured enterprises to develop their business in this field. On the other hands, lawmakers nevertheless show concerns that new models of digital services may jeopardize the national security and invade the privacy of individuals. It is not until recently that the legislature and the government have intensively issued new laws, for example, the Cyber Security Law to emphasize the importance of protecting national security and data security and provide clear instructions on how network operators and operators of CII should behave in securing these interests.
Mexico is currently developing a National Digital Strategy which purpose is to build a digital country. Such National Digital Strategy has five main objectives: (i) innovation and citizen participation; (ii) universal and effective health; (iii) educational transformation; (iv) digital economy; and (v) government transformation.
It is important for the Mexican government to take advantage of the developments and potential of the TICs industry in order to help the development of the country. And, despite the fact Mexico is at the bottom of the countries in the Organization for Economic Co-operation and Development (OECD) on digitalization matters, Mexico is going through many changes and amendments on its legal framework in order to adopt a new digital strategy to develop almost all sectors in the country.
The UK legal system (when viewed in combination with the economic environment) is currently seen as conducive to digital startups and is seen as the epicentre for developments in AI and machine learning, globally. DLA Piper has run three iterations of its Tech Index, https://www.dlapiper.com/~/media/Files/Insights/Publications/2016/09/EU_tech_index_2016.PDF assessing the trends in digital innovation and growth prospects (and potential blocks). The 2016 edition highlighted that the key areas of focus are cyber security, IoT, AI and robotics, FinTech and Digital Transformation.
Ongoing concerns over cyber-attacks are still high among almost half of companies interviewed; yet only one quarter have response plans in place, which leaves those unprotected open to a major attack.
The research highlights concerns over compliance regulations, staff skills and investment which could hold development of FinTech back.
Rather than the impact of the legal system, the research shows that lack of skills and investment could hinder advancement of IoT and AI.
Our legal system is aligned with the EU legislation in the field of digital services. At the EU level, as well as in Romania the digital environment is regulated by laws that are currently outdated (see as an example the legislation for the electronic commerce sector, which was enacted in 2000), as well as encompassing many grey areas, since many aspects of the digital environment are largely unregulated. As a consequence, the current frameworks as well as case law fail to provide legal certainty for the development of digital services.
In the technology field, legislation can never be entirely up to speed with the latest innovations and technology developments. It is important that the system is able to adapt quickly, both in terms of new legislation being passed by the Parliament and technology friendly law interpretation by the judges, and this does not always happen in Italy. Notwithstanding the above, in our opinion the greatest impediment to economic development in the technology area in Italy does not arise from the legal regime, but is caused by the high level of taxation in our country, which prevents many investments from happening. However, in this regard it must be pointed out that recently the government has approved substantial tax benefits for investments in R&D and these may have an impact on future investments on new technologies too.
In general, Dutch law does encourage the provision of digital services by trying to treat digital services – to the extent possible – the same as more traditional “off-line” services. The Dutch government has also undertaken numerous initiatives to stimulate digitalization and to create prerequisites. These prerequisites range from investments in education, IT-Telecom infrastructures, network security and the limiting regulatory burden.
In certain areas, it encourages and in others, not so much. The Internet Act enacted in 2014 brought a very positive legal environment for internet companies, which is positive. Among other provisions, it creates a safe harbour to internet service providers on liability for user-generated content and defines clear and specific rules for collection, use and treatment of personal data collected in the internet. In addition to the Internet Act, another initiative of the Brazilian government is the development of the national plan for the internet of things (IoT), aiming at creating a favourable and safe legal environment for the Industry 4.0. If approved, it will certainly encourage even more the offering of digital services in the country.
In terms of protecting IP rights with patents, Brazil is not going a good job, and a patent may easily take more than 10 years to be granted.
We view that the Indonesian legal system is trying to simultaneously encourage digital services while providing adequate security regulation for citizens’ personal data. In principle, through this balance, users of digital services will be more comfortable using such digital services, knowing that their data is sufficiently protected by the law. An increased demand for digital services, in turn, should boost the digital services business in Indonesia by local and foreign investors attracted by the large market.
The legal structures that exist in relation to digital services consists primarily of the IT Act along with several legislations that govern the fundamental, structural and operational aspects of any business in the country. The Government has, in most cases, taken a balanced approach between the interests of businesses and consumers, in the case of laws relating to digital business. For instance, the Government, to keep up with the changing times, has introduced amendments to the IT Act in 2008 whereby: (i) clarity in relation to the definition of “intermediary” was provided; (ii) electronic signatures were recognised; (iii) corporate responsibility for data protection was incorporated; (iv) legal validity of electronic documents was re-emphasised, among others. The Indian judiciary has also held that if the intermediaries have specific knowledge of unlawful content on their website, even in the absence of a court order, they cannot escape liability under the IT Act. This may have a substantial impact on the obligation of intermediaries to delete or take down any content on knowledge of infringement. Recently, service of summons by the court through WhatsApp was considered as an acceptable mode of service in order to reduce the delay in serving summons in the absence of proper address. The Supreme Court has recently struck down a section of the IT Act, as unconstitutional, which gave the Central Government/police, in the name of “national security” unqualified power to arrest a person who posted any content on social media against the Government. While the IT Act is broad enough in its scope to address various aspects of doing business through electronic channels, the pace of development in technology and business models in the digital industry has meant that the legal system fails to address several issues. At the same time, the Government is itself becoming one of the largest consumers of digital services, since it has planned huge investments in areas such as e-governance, smart cities, and the use of technology to improve security. The Government has recently issued guidelines to encourage procurement of cloud-based services by various government departments.
In our view, the Israeli legal system mostly encourages the development and use of digital services in unregulated sectors, while hindering its use in regulated sectors. There is considerable governmental support for digitalizing government services (e.g., Digital Israel). However, regulated sectors such as the telecommunication and financial sector may be considered slow in adopting new digital services due to the need for the regulatory approval, and in addition regulation of different aspects of the hi-tech sector should be taken into account (such as regulation of encryption and authentication means, and of dual-use technologies).
Singapore's legal system encourages the development and use of digital services. Several regulatory and governmental initiatives have been implemented or proposed over the past few years. On 16 November 2016, the MAS issued guidelines for a regulatory sandbox which aims to encourage and enable experimentation of solutions that utilise technology innovatively to deliver financial products or services. New legislation, such as the proposed Cybersecurity Act as mentioned above, is also being developed with the aim of fostering a stronger and more conducive legal landscape for the development of digital services.
Digital services are ruled in essence by EU legislation, which has largely shaped French consumer law through the last twenty years or so. Therefore, national specificities will less be found in the legal system than in the economy.
However, France has lately become a determined proponent of digital administration, in particular through simplifying and transferring procedures to the internet (for instance with public procurement platforms and digital invoicing mechanisms) and through disseminating an increasing volume of open data (www.data.gouv.fr).
On the one hand, the guide for cloud computing (Orientierungshilfe – Cloud Computing vom 09.10.2014) provides detailed instructions on how to use cloud-based services which provides much clarity in this area. On the other hand, data protection regulations are very strict, as it will be the case throughout Europe due to the GDPR.
The Swiss regulatory framework encourages digital services, in particular due to the technology-neutral approach of the legislator, thereby allowing for ample room for development for technology driven business models and companies. Hence, there are generally no regulation-induced impediments to technology innovation under current law. Government authorities periodically review developments in technology and generally emphasize the importance of making use of technological progress. Considerable efforts are undertaken to further facilitate lower market entry barriers for technology-driven business models.
Strictly speaking, the Ecuadorian legal system does not hinder digital services. Yet, because of the lack of a specific legislation that can be applied to digital services, this leaves them scarcely regulated, which to some extent can bring about confusion as to their use, application and delivery.