Amendments Nos. 1 and 2 are related and are to be taken together.
Electronic Commerce Bill, 2000 [ Seanad ] : Committee Stage.
I move amendment No. 1:
In page 7, subsection (1), to delete lines 5 to 10 and substitute the following:
"‘public body' means–
(a) a Minister of the Government or a Minister of State,
(b) a body (including a Department of State but not including a non-government organisation) wholly or partly funded out of the Central Fund or out of moneys provided by the Oireachtas or moneys raised by local taxation or charges, or
(c) a commission, tribunal, board or body established by an Act or by arrangement of the Government, a Minister of the Government or a Minister of State for a non-commercial public service or purpose;".
This amendment clarifies what is meant by a public body. This issue was raised in the Seanad and I said I would come back to it on Committee Stage when I had it clarified. We have had the matter clarified and a public body is a body including a Department of State but not including a non-government organisation as laid out in the amendment. Amendment No. 2 goes on to delete part of section 1 and substitute other information. This arose when all parties in the Seanad questioned the meaning of "public body".
I have no problem with that.
I am happy with it.
I move amendment No. 2:
In page 8, lines 8 to 18, to delete subsection (4) and substitute the following:
"(4) Where in any legal proceedings the question of whether–
(a) a body is a non-government organisation, or
(b) a body, commission, tribunal or board is or was established by an Act or by arrangement of the Government, a Minister of the Government or a Minister of State for a non-commercial service or purpose, is in issue then, for the purpose of establishing whether it is or is not a public body as defined in subsection (1), a document signed by the Minister, a Minister of the Government or a Minister of State declaring that–
(i) he or she is the appropriate Minister for determining whether the body is or is not a non-government organisation, and that in fact it is or is not such an organisation, or
(ii) he or she is the appropriate Minister for determining whether the body, commission, tribunal or board was or was not so established for a non-commercial service or purpose, and that in fact it was or was not so established, is sufficient evidence of those facts, until the contrary is shown, and the Minister, Minister of the Government or Minister of State may make such a declaration.".
On Second Stage I raised the issue of Bille Chearta na Gaeilge, which I understand is with various Departments. Will this section allow people to conduct business with public bodies through Irish when and if Bille Chearta na Gaeilge is passed in law? Will people have the right to conduct their business with public bodies through Irish?
The Deputy raised this question on Second Stage and I am assured that the right of people to do their business in whatever way is laid out by law in Irish and English will be guaranteed to them.
I move amendment No. 3:
In page 9, before section 7, to insert the following new section:
"7.–It shall be an offence under this Act for any person to cause or carry out any electronic communication or activity that would–
(a) obtain access to any credit card facility of an individual,
(b) hack into any on-line site without authorisation,
(c) generate an on-line virus.".
My purpose in moving this amendment is to hear the Minister confirm that these areas of well known fraud are clearly stipulated. These are well established cyber crimes. I have been told by Department officials that this Bill is not the appropriate place to deal with these matters or that they are dealt with by the Criminal Damages Act, 1991. Will the Minister confirm the legal position with regard to these crimes?
In the past six months we have come to describe on-line illegal activities as cyber crime. However, this is not a justice Bill, it deals with business. The Criminal Damages Act, 1991, contains a number of very general damage to property offences, including damage to computer data. The Criminal Justice Fraud Offences Bill, which is an up-date of the 1991 Act, is due for publication in the autumn of this year. It will contain a number of offences related to electronic commerce. The Department of Justice, Equality and Law Reform will work closely with my Department to ensure that Bill reflects the type of issue which have been raised in amendments to this Bill.
Is there a timetable for that?
I asked the Minister for Justice, Equality and Law Reform that question this morning. The Bill is due for publication in the very near future.
Amendments Nos. 5 to 10, inclusive, may be discussed together, by agreement.
I move amendment No. 5:
In page 9, before section 9, but in Part 1, to insert the following new section:
9.–It shall be an offence under this Act for any person to monitor or track any electronic communication by an originator without that person's consent.".
This is the area of the Bill about which I feel most strongly. I raised this matter on Second Stage and public concern has been expressed. I refer to an article inThe Irish Times of 19 May. If any individual operates a personal computer to surf the Internet, any site visited can be tracked by the Internet service provider and these data given to marketing companies. This is an intrusion of people's privacy.
Amendment No. 5 would make it an offence to monitor traffic without the user's consent. Amendment No. 6 would make it an offence to store information without the consent of a user. Amendment No. 7 would require information previously garnered to be deleted and destroyed, thereby setting a start date for this privacy and dealing with the lacuna which would otherwise arise. Amendment No. 8 would ensure that data protection legislation related to the EU directive would be fully implemented. Amendment No. 9 would make it an offence to give information on Internet users to a retail chain, for example, for marketing or other purposes. Amendment No. 10 would establish the right of every citizen to find out what data is held on him or her on computerised records.
It has been argued that these matters should be dealt with in other legislation, but I disagree. This Bill deals with individual rights, not merely with business. Privacy must be protected and the data protection measures being drafted at European Union level move in this direction. Article 7 of the EU directive states that the unambiguous consent of the individual is required before data can be processed and the explicit consent of the individual is required in relation to sensitive personal data.
I accept that data protection legislation is to be amended but the two should coincide here. I am told it is impracticable and undesirable to forbid e-commerce companies from storing information regarding their customers, but I do not accept that argument. Banks, doctors and solicitors, for example, are obliged to keep information about clients confidential. There cannot be different charters for off-line and on-line business.
United Kingdom legislation attempted to deal with these issues. In the United States, which pioneered thelaissez faire attitude to this issue, the Federal Trade Commission has introduced a study which recommends a change of policy. Its advisory committee report on privacy, Security and Protection Approaches for Protection and Legislation, highlights these points. A laissez faire approach to electronic commerce is not adequate. I seek basic safety provisions for users of the Internet. This is the part of the Bill about which I feel most strongly.
Amendment No. 10 would establish "the right of every citizen to apply for and obtain all data which is held on him or her on any electronic database held in the State". Could this power be extended to databases not held in the State? Could this restriction be avoided by taking a database outside the State or could such an activity be regulated by this or the other legislation mentioned by the Minister?
I thank Deputies Yates, Coveney and O'Shea for tabling these amendments and for their comments on them. Privacy in the face of bureaucracy is becoming increasingly central to EU directives and national legislation. Since the Second Stage debate I have been aware of Deputy Yates's and Deputy O'Shea's concern in this regard and I asked for full information on this matter.
The Data Protection Act, 1988, set up the Data Protection Commission to ensure the legislation was enforced. That Act needs to be updated. Many of the principles of the European directive on data protection are already included in the 1988 legislation. The Department of Justice, Equality and Law Reform has carried out consultation on the transposition of the directive and legislation is now being drafted which will be published in the autumn. This will be an up-date of the Data Protection Act, 1988.
In regard to amendment No. 5, the 1988 Act provides that personal data must be "fairly obtained" and it must only be used for the purpose for which it was collected. We had extensive discussions with the Data Commissioner, Fergus Glavey, and his office. If companies collect data without the knowledge and consent of individuals, it would be in contravention of the 1988 Act, which will be updated in the autumn by the Department Justice, Equality and Law Reform in the light of the directive which is waiting to be transposed into law.
Deputy Yates is right in that the European directive goes even further in article 7 by providing that the unambiguous consent of the individual is required before data can be processed. The 1988 Act will be amended to reflect that part of the new directive and we have been told by the Department of Justice, Equality and Law Reform that it will be formulated and issued in the autumn. Therefore, a single, clear, coherent and regulatory environment for data protection and privacy issues would seem to be in the best interests of business and individuals.
Amendment No. 6 seeks to forbid e-commerce companies from storing information on their customers. It is often essential for e-commerce businesses to store information on their customers as long as the data is got in a fair way and used fairly and legitimately for the purpose for which it was got and in accordance with the existing legislation, which is 12 years old and soon to be updated. Beyond that, there should not be any restriction. Similarly, as proposed in amendment No. 7, it would be wrong to oblige e-commerce companies to destroy information which they had gathered correctly and legitimately and which was gathered for a particular purpose correctly stated. Why should they seek to destroy that data when it was got for fair purposes? In regard to all the amendments, section 27 provides a very clear privacy protection in that it clearly precludes the seizure. Deputies will remember we talked about our compulsion to hand over private keys.
In regard to amendment No. 8, the Data Protection Act applies to all electronic data. If I was in the Deputy's place, I would have tabled those amendments – I cannot put it more clearly than that – because they are good amendments and their intention is good. The purpose of the amendments is good because they seek protection of privacy in a global sense and in the other senses outlined in the amendments.
The Data Protection Act, 1988, is 12 years old and will be updated this autumn by another Department in the light of an intervening European directive. I spoke to my colleague in recent days and he told me that Act would be considerably updated. Those issues arose when we discussed this Bill at Cabinet, although not in as much detail as we are discussing it now. It is clear that it is better to have one Act. We must remember that electronic and written business will be equal, which is the purpose of the Act. It is better that the Data Protection Act, 1988, which established the commissioner, the Data Protection Commissioner, his office and the amended Data Protection Act provide the regulatory framework to ensure the security of privacy issues. That is my response to those well prepared amendments, and I am not being smart or patronising because those are the kind of amendments I would be disposed to tabling if I was on the Opposition benches – they are, in essence, good amendments.
The European data protection directive applies to the members states and is to be transposed into legislation this autumn. Section 11 of the 1988 Act prohibits the transfer of data outside the State. A recent "safe harbours" agreement between the EU and the US applies the same data protection on a voluntary opt-in basis in the US for data transferring the content of a trade, etc. In general, the question Deputy O'Shea raised is best reposed in the Data Protection Act soon to be amended.
Although neither the Minister nor I were Ministers for Justice, my understanding is that EU the Commission has made legal threats against the Government because the data protection directive has not been legislated for. The Commission is accusing the Department of Justice, Equality and Law Reform of foot-dragging on this issue. What I am looking for is that people can surf the net anonymously. That is the key point. I will put amendment No. 5 to a voice vote because we do not have much time. I will withdraw the other amendments.
On a point of order, when we take Committee and Report Stages together—
We are taking Committee Stage now.
All Stages are being taken now.
We are taking Committee Stage now and then we will move on to Report Stage.
Normally, I withdraw an amendment and re-table it on Report Stage. How do I do that when we are taking both Stages consecutively?
You can re-table your amendment now for Report Stage.
The amendment I feel very strongly about is amendment No. 5—
It states that it shall be an offence under this Act for any person to monitor or track electronic communication.
The Deputy said the EU was cavilling at the delays in the Department of Justice, Equality and Law Reform in transposing the new directive on updating the Data Protection Act. I raised this issue with the Minister, Deputy O'Donoghue, who is a very good Minister. All Ministers like their Departments and what goes on in them, and he assured me that legislation to update the 1988 Act would be introduced in the autumn.
The office of the Data Protection Commissioner was established in 1988 which seems like a different era. Technological advances, which are at the core of the Deputy's point, have meant that many of the provisions of the 1988 Act are not sufficiently strong or balanced. That is why the EU introduced the new directive updating these matters.
I will draft a letter to Mr. Glavey tomorrow and speak to him. I will also send the "Blacks" to his office and to the Minister for Justice, Equality and Law Reform, so they are in no doubt that the House feels the transposition of the new EU directive should include strong provisions on privacy and business.
I will resubmit amendments Nos. 6 and 8 on Report Stage.
I move amendment No. 7:
In page 9, before section 9, but in Part 1, to insert the following new section:
"9.–Any person or organisation, including an internet service provider, who, prior to the date of the enactment of this Act, has any information relating to electronic communications via an originator shall be required to delete and destroy all such information, unless they have the consent of the person to whom the information relates to do so.".
I move amendment No. 11:
In page 9, before section 10, to insert the following new section:
10.–(1) Notwithstanding section 9, a person shall not send an unsolicited electronic communication to another person for the purposes of any trade or profession.
(2) It shall be presumed that the recipient of such a communication has suffered damage in the amount of £100 per communication and the District Court shall have jurisdiction in respect of any claim under this section pursuant to rules of court providing for the bringing of small claims.
(3) Without prejudice to the right of action in damages for any breach of subsection (1), the Minister may apply to the Circuit Court for an order requiring any person to comply with this section.
(4) Where an internet service provider is aware of a contravention of this section, it shall take such steps, including withdrawal of service or blocking of e-mails, as are required to ensure that the section is complied with.".
This amendment seeks to impose a prohibition on unsolicited electronic communications or "spam" which is the electronic equivalent of junk mail. This type of communication is inappropriate for a number of reasons and should be stopped. Such communication is a threat to the Internet and is a major blight on e-commerce. It wastes time and capacity and must be banned.
The amendment sets out a number of measures which would help achieve this objective, including a small claims court fine of £200 per communication. The Minister could intervene in this issue. I will not labour the point as the issue is fairly clear. However, this is another aspect of privacy in the context of not wasting people's time or not cluttering up their receivers with information which is unwelcome and unsolicited.
I support the amendment.
I thank the Deputy for this useful contribution on how to deal with spam. Article 7.2 of the new e-commerce directive provides that members states shall take measures to ensure that service providers undertaking unsolicited commercial communications by electronic mail consult regularly and respect the opt-out registers in which persons not wishing to receive such commercial communications can register. Such consultations should seek to ensure that names on the register do not slip in that people again begin to receive unsolicited communications.
The Minister for Enterprise, Trade and Employment, Deputy Harney, will address this issue when transposing the provisions of the e-commerce directive. The Department is working on the directive and legislation will be introduced in the autumn.
This was one of the trickiest issues involved in the Bill. This is a simple Bill. However, because it is important in business terms, it strayed into other areas through good intent. Deputy Harney has assured me that legislation transposing the e-commerce directive will be ready in the autumn – it will be a busy autumn. However, this Bill deals with the electronic signatures directive. Deputy Harney will be dealing with the e-commerce directive. Article 7.2 of the e-commerce directive includes the measures outlined in the amendment. I cannot anticipate the legislation but it is forthcoming.
I withdraw the amendment on the basis of the Minister's assurances.
I move amendment No. 12:
In page 10, subsection (1)(b), lines 3 and 4, to delete "other than contracts (whether or not under seal)".
Section 10 deals with exclusions. The Law Society has requested this amendment which deals with transfers of real estate and property. If it is not accepted buyers and sellers of property will be permitted to enter into contracts over the Internet without professional advice or any cooling off period. This will produce an anti-consumer effect for purchasers of new houses who are frequently faced with unfair terms in purchase contracts which they may not, as lay people, be able to unravel.
Legislation governing contracts on the purchase and sale of land and property is chiefly governed by the Statute of Frauds which has created a formal procedure for the acquisition and disposal of property which gives the parties to the transaction ample time for considering their positions after the payment of a booking deposit. It also provides adequate time to check their position under the Planning Acts, Family Law Acts and the title to the property in question. None of this will be possible if one can buy property over the Internet.
I am seeking to replicate the off-line facilities of checks and balances which deal with these often problematic issues. This would make it possible for people to ensure that title deeds and planning permissions are in order, or to see if anyone has a financial or other charge on the property. Such a situation may involve a family member or be due to marriage break-up. In such circumstances the way paragraph (b) is framed is somewhat contradictory. The exemptions and exclusions are set out. On first reading it looks as if real property is excluded, but it is not. I have given this matter some consideration. The people who are advising me are legal specialists in this area, people who should not be dismissed. I do not believe they have a vested interest. It is the due diligence aspects of property transactions that I seek to have dealt with here.
This is very interesting because it is in the line of vested interest. We received the same correspondence, as did the Attorney General and various other people. The group in question calls itself the Conveyancing Committee of the Law Society of Ireland. I am sure its members are very estimable people of the highest integrity and that they have concerns about this. We consulted widely when those concerns were conveyed to us and could find nobody outside the Conveyancing Committee of the Law Society of Ireland who had similar concerns. The Attorney General wrote back to them, and we have copies of that correspondence. We consulted with the Land Registry, the Department of Justice, Equality and Law Reform and the Department of the Environment and Local Government. We met representatives of the Law Society of Ireland – I do not know whether they were with the Conveyancing Committee, but I presume they were – regarding the inclusion of contracts for the disposal of land and property under the Electronic Commerce Bill as published. They were not satisfied with our response. They have every right to put forward their case. However, I also have every right to stand up for consumers and their rights in this regard. We are of the opinion that the concerns, although coming from a legitimate background, the Conveyancing Committee of the Law Society of Ireland, are misplaced. It is with regret, therefore, that I cannot accept the amendment.
The thrust of this section is to ensure the disposal of land or premises can be carried out on line but that the registration of deeds is carried out off line. Nobody I mentioned, the Attorney General, the Land Registry, the Department of Justice, Equality and Law Reform and the Department of the Environment and Local Government, has any objection to allowing such contracts to be carried out on line. That is the background.
I am not proposing the deletion of paragraph (b), just six or seven words in it. Has the Minister been briefed on what the precise import of my amendment would be? In other words, there could be a sale in principle, but the deeds are not yet registered. Is it possible to have a half-way house?
One of the points that puzzled us obviously struck others from whom we sought advice. The same degree of informality attends entering into a binding contract via the fax machine, which is currently possible. What we do not understand, nor can anybody else with whom we have discussed the matter, is what new dimension of danger is posed to the integrity of the conveyancing process by the Internet. It seems to us, and to all with whom we have consulted, that the Internet poses no new additional dimension of danger to the integrity of the conveyancing process. That remains the position. I am sure there are conveyancing committees and all sorts of other committees of various societies, and I am sure the one attached to the Law Society is an excellent one. However, I do not understand the sudden rush of blood to the head about this. There is no real need for it. There is nothing in our proposal which precludes the taking of legal advice or which means legal advice is obviated or put to one side. Everybody is free to consult any legal source. This seems to be to an overemphasis on a particular role, not just in my book but in that of many other people.
I will withdraw the amendment. However, there is a substantive difference between logging on to a PC and buying a house or whatever and a situation where a person has the normal consumer protection whereby there is established in law a 14-day cooling off period during which time a person might decide, having thought about a particular transaction, he or she is not so keen. It must be noted that the people selling on the Internet are in the hustling business. What I am trying to do is ensure people do not get suckered into something on line without going through the small print to which they would give more scrutiny if they had it on paper. I will be able to make a better case in which there is no vested interest element and which I will argue more strongly later.
I move amendment No. 13:
In page 10, subsection (1), between lines 9 and 10, to insert the following:
"(e) all matters relating to a patent provided by the Patent Office, or
(f) all matters relating to appeals and determinations by An Bord Pleanála.".
I am seeking the exemption of patents and An Bord Pleanála appeals. Both are vital legal areas. The Minister's departmental officials were unable to give me a straight answer on this and were going to consult with the offices. In terms of An Bord Pleanála appeals the written word is very important. There are very strict deadlines, and very strict procedures. Those procedures should be dealt with off line. These are areas where due care is very important.
Regarding the Patents Office, given the threat of hackers and so on, the security of patents is a very important issue. The whole point of a patent is the secrecy element of it and the protections therein. I await with interest the Minister's reply on whether she is prepared to accept this amendment.
Paragraphs (e) and (f) of amendment No. 13 go against much of what we are trying to do in this legislation. They also go against what other Departments are trying to do. The Patents Office is already preparing itself for the introduction of electronic filing of applications and other documents in the patents and trade marks area. While it might take some time to finalise those plans and to install the necessary supporting technology in the office, that should not stand in the way of this enabling legislation which will, in time, permit the office and its clients to do business by electronic means.
Paragraph (f) refers to An Bord Pleanála. The Department of the Environment and Local Government has indicated that the exclusion of An Bord Pleanála from the terms of the Electronic Commerce Bill is unnecessary because the Planning Bill was recently amended to allow transactions with the board to be carried out electronically when information technology and procedural requirements are in place. The Bill has been concluded in both Houses except for a minor extract from it which is going through today.
It is with the very best of motives that Deputies Yates and Coveney have tabled these amendments. However, there is inherent in them a strong element of protectionism which is wrong, given that we are opening up Government, Government Departments and all the agencies that operate under Government through the whole information society. Our aim is that all of that will be available to the citizens of the State in a very open way so that their business can be done in this way. The amendments, though clearly well meant, would take away from what is already provided for in the recently amended planning legislation, because the Departments are already gearing themselves up to do business between themselves and with the agencies operating under them. The Patents Office has done likewise. I would not seek to hold back agencies of Government which should be properly available and accountable to citizens.
I move amendment No. 14:
In page 10, lines 12 to 24, to delete subsection (2) and substitute the following:
"(2) Where the Minister is of the opinion that—
(a) technology has advanced to such an extent, and access to it is so widely available, or
(b) adequate procedures and practices have developed in public registration or other services, so as to warrant such action, or
(c) the public interest so requires,
he or she may, after consultation with such Minister or Ministers as in the Minister's opinion has or have a sufficient interest or responsibility in relation to the matter, by regulations made under section 3, for the purpose of encouraging the efficient use of electronic communication facilities and services in commerce and the community generally while at the same time protecting the public interest, extend the application of this Act or a provision of this Act to or in relation to a matter specified in subsection (1) (including a particular aspect of such a matter) subject to such conditions as he or she thinks fit, and the Act as so extended shall apply accordingly.".
This seems complicated, but is not. We have transposed a paragraph in subsection (2)(c). It is a technical amendment clarifying that the Minister may make regulations extending the application of the Bill to areas of excluded law if, after consultation with the relevant Minister, she feels it would be in the public interest to do so. This was always the intention of the subsection, but its rewording makes that clearer.
Amendment No. 19 is related to amendment No. 15 and both amendments may be discussed together. Is that agreed? Agreed.
I move amendment No. 15:
In page 10, between lines 27 and 28, to insert the following subsection:
"(4) Sections 12 to 20 of this Act are without prejudice to such regulations as may be prescribed by the Minister in order to fulfil the State's obligations under a Directive of the European Parliament and European Council.".
The Minister has not accepted any amendments though she has agreed with most of them. I hope there will be some good news before Committee Stage has concluded.
That is because I want to keep the Bill pure and simple.
The Minister wants to have it both ways. She agrees with all the sentiments but is not prepared to do anything about it.
It is a simple Bill for business.
I know that.
The Deputy might be surprised.
Good. A barrister has given me detailed advice on this in relation to—
None of them came to me.
This was an individual assistant. The purpose of the legislation is to create equality between paper and electronic transactions. Sections 12 to 20 largely give effect to article 9, subsection (1) of the current draft of the Directive on Electronic Commerce. I do not know if that directive has been agreed by the Council of Ministers.
It has been agreed.
This directive is distinct from the directive on electronic signatures, referred to and implemented by the Bill. Article 9.2 of the draft directive on electronic commerce permits certain exclusions from the scope of section 10 of the Bill. It is clear that the text of article 9.2 has influenced the drafting of section 10 which sets out the exclusions from the scope of sections 12 to 22. However, I am advised that the Minister has missed the fact that article 9.2 does not set out the only list of exclusions from the scope of the draft directive. The recitals to the draft directive specifically state that the directive will be without prejudice to ten existing EU directives, namely, Directive 93/13 on Unfair Terms of Consumer Contracts, Director 84/450 on Misleading Advertising, Directive 97/55 on Comparative Advertising, which has not yet been implemented in Ireland, Directive 87/102 on Consumer Credit, which concerns the specific matter of amendment No. 19, Directive 98/7 on Consumer Credit, which has not been implemented in Ireland, Directive 90/314 on Package Travel, Directive 98/6 on Consumer Product Pricing, Directive 97/7 on Distance Consumer Contracts, Directive 98/43 on Tobacco Advertising and Directive 92/28 on Medicinal Products Advertising. Of these, five have not yet been implemented in national legislation. It is important that the Bill permits the Minister to exclude from its scope the directives listed in the draft directive and any future directives which the European Parliament and European Council may see fit to exclude from the scope of the directive on electronic commerce. In simple terms, the EU has provided for exceptions to the rule.
I am particularly concerned about the failure to exclude the directive on consumer credit from the scope of the Bill. Failure to do so will place the State in automatic breach of the directive when it comes into effect. The directive on consumer credit was implemented by Ireland in the Consumer Credit Act, 1995, and contains extremely important safeguards for consumers. Article 4, subsection (1) of the directive states:
Credit arrangements shall be made in writing. The consumer shall receive a copy of the written agreement.
Article 6, subsection (1) requires that certain information in relation to consumer overdraft arrangements "shall be confirmed in writing". The requirements of writing contained in the Consumer Credit Act, 1995, which give effect to articles 4 and 5, must therefore be exempted from the scope of the relevant provisions of the proposals. The point is that the directive on consumer credit and the Consumer Credit Act, 1995, which implements it, ensure consumers get a hard copy of the credit agreement. This is of particular importance because the Act prescribes that the agreement must contain a clear statement as to the consumer's cooling off period, that is, it must clearly state that the consumer has ten days in which to withdraw from the contract without penalty.
There is a difference between a credit agreement which is on-screen and which the consumer can agree to, and a written agreement which is physically sent to the consumer for perusal and agreement. The fact that the consumer receives a hard copy is cautionary to him or her. Furthermore, the hard copy is more conducive for skimming through and hence the consumer is more likely to spot the clear statement regarding the cooling off period. Consumer credit is already offered on a very large scale via the Internet. One notes in particular the growth of electronic stockbrokers offering significant credit terms. There is a real need to protect the unwary, especially in times of exuberant markets.
As the Eircom share price hits 2.68 euros, the Minister will need no instructing in terms of what I have said. It seems Murphy's law is applying to the Eircom IPO in so far as the bonuses to the management will apply not at the share price of 3.90 euros but at the share price of 2.68 euros.
I do not think this arises under the amendment.
I will adhere to the strictures of the Chair. The point is that there are times when a deal concluded electronically requires greaterpost hoc scrutiny. The EU Commission provides for exclusions in its directive. Specifically amendment No. 19 is worthy of consideration in terms of consumer credit law and other consumer protections which I will discuss later so that an equal balance is struck between the vendor and the consumer.
First, Alfie Kane wants to blame everyone else – he should look to the mote in his own eye.
It is ironic that Deputy O'Malley and I are the two people who know most about the Consumer Credit Act, because when Albert Reynolds gave me the chop I went to see Deputy O'Malley who was most kind and courteous and advised me to make sense of the consumer credit directives. We introduced the Consumer Credit Act and we were down to the final two amendments when the Government fell. I note Deputy Rabbitte now claims the Act as his own, but that is the way of politics. It was a most interesting Act. I remember there were 420 amendments and we spent one summer discussing them.
I take the points raised by the Deputy. We are obliged to correctly implement EU law, either by statutory instrument or primary legislation. Amendment No. 19 seeks to ensure further protection for consumers. Section 30 of the Consumer Credit Act provides that consumer credit agreements must be either handed directly to the consumer or sent to them. Section 45 of the Act stipulates that such a written communication must be in a sealed envelope. The provisions of the Act are not undermined in any way by the Bill. They will to be complied with to the letter by credit institutions. On the inclusion of unfair terms in consumer contracts, the regulations apply equally to electronic and paper consumer contracts. This issue is of huge importance and in its own way touches on earlier amendments which were not fully accepted.
Paragraph (c) of amendment No. 19 reads, "the Consumer Credit Act, 1995, or any regulations made thereunder and the European Communities (Unfair Terms in Consumer Contracts) Regulations, 1995 (S.I. No. 27 of 1995), or . . ."
I wish to make a suggestion. I understand there is to be a break between 2 p.m. and 2.30 p.m.—
That is correct.
—and that the debate will resume following Question Time at 3.50 p.m. and continue until 4.20 p.m. I suggest that that segment be designated as Report Stage.
There may be Private Notice Questions at 3.50 p.m.
Does that not mean that the debate will run later?
The debate on the Bill will have to conclude at 4.20 p.m.
Irrespective of what happens.
Paragraph (c) of amendment No. 19 may have to be reworded. Report Stage follows Committee Stage. It will not be taken on a separate day. Can an amendment be taken on the floor of the House?
A Minister may circulate a proposed amendment in advance of Report Stage where Report Stage has to be taken on the same day by order of the House. The Minister is, therefore, free to circulate an amendment which would be included in the final question.
I ask Deputy Yates to accept my bona fides. Paragraph (c) of amendment No. 19 may have to be reworded. Section 45 of the Consumer Credit Act stipulates that a contract must be in a sealed envelope. That is an important protection.
There is another directive on the list of ten which is a source of particular concern, that is, the unfair terms in consumer contracts directive, No. 93/13, implemented by the European Communities (Unfair Terms in Consumer Contracts) Regulations, 1995 (S.I. No. 27 of 1995). The problem relates to section 29 of the Bill. The amendment deals only with the problem relating to the Consumer Credit Act. It does not deal adequately with the problem relating to unfair terms. The problem is the interaction between section 29 of the Bill and the unfair terms regulations. Amendment No. 1 only blocks the impact of sections 12 to 22, inclusive.
Amendments Nos. 16, 17 and 30 are consequential on amendment No. 18. Is it agreed that amendments Nos. 16 to 18, inclusive, and No. 30 be discussed together? Agreed.
I move amendment No. 16:
In page 10, paragraph (a), line 31, to delete "or".
This matter was raised by Senator Costello on Committee Stage in the Seanad by way of amendment to section 22, which was accepted in good faith. The Department of Justice, Equality and Law Reform has since pointed out that the substance of the amendment, requiring the production of original documents in certain circumstances is in direct conflict with the Criminal Evidence Act, 1992, section 30 in particular, which provides on a general basis for the tendering of evidence in criminal proceedings of copies of documents, whether the original is still in existence.
The list of Acts included in the Bill will have to be amended to include a reference to the Criminal Evidence Act.
That is correct.
I move amendment No. 17:
In page 10, paragraph (b), line 34, to delete "regulations." and substitute "regulations, or".
I move amendment No. 18:
In page 10, between lines 34 and 35, to insert the following:
"(c) the Criminal Evidence Act, 1992.".
I move amendment No. 20:
In page 12, before section 14, to insert the following new section:
"14.–Nothing in this Act shall alter existing requirements whereby, by law or otherwise, a signature to a document is required to be witnessed (whether this requirement is in the form of an obligation or consequences flow from a signature not being witnessed).".
Due care is required where a document requires to be witnessed. This a special caveat. Is the Minister of the view that there is a need for a separate procedure? I am not pressing this issue strongly.
The thrust and spirit of the Bill is to allow for equivalence between the paper and electronic word. The Bill provides that electronic signatures will be equivalent to handwritten signatures. Witnessing is another form of signature. It, therefore, is in line with the thrust of the rest of the Bill to allow documents to be witnessed electronically. In recognition of the significance of witnessing, however, the Bill stipulates that both the signature being witnessed and the witnessing signature must be an advanced electronic signature based on a qualified certificate.
I move amendment No. 21:
In page 13, before section 15, to insert the following new section:
"15.–All electronic contracts within the State shall be subject to all existing consumer law and the role of the Director of Consumer Affairs in such legislation shall apply equally to consumer transactions, whether conducted electronically or non-electronically.".
In my dialogue with the Minister's officials they intimated that the amendment might be acceptable. I hope the Minister agrees. The purpose of the amendment is to ensure that all aspects of existing consumer law would apply equally to everything off-line and on-line. There should be a similar equivalence for the consumer. Every protection available from the Director of Consumer Affairs off-line should also apply on-line.
I accept that.
I move amendment No. 22:
In page 13, before section 15, to insert the following new section:
"15.–(1) The Minister may, by regulations made under section 3 after consultation with the Minister for Enterprise, Trade and Employment and such other persons and public bodies, if any, as the Minister thinks fit, including the body known as the Cryptography Certificate Registration Authority, authorise, prohibit or regulate the registration and use of the certificates under this Act.
(2) Without prejudice to the generality of subsection (1), the regulations may prescribe–
(a) designated registration authorities,
(b) the form of registration,
(c) the period during which registration continues in force,
(d) the manner in which, the terms on which and the period or periods for which registration may be renewed,
(e) the circumstances and manner in which registration may be granted, renewed or refused by the registration authorities,
(f) the right of appeal and appeal processes,
(g) the fee, if any, to be paid on the grant or renewal of registration and the time and manner in which such fees are to be paid,
(h) such other matters relating to registration as appear to the Minister to be necessary or desirable to prescribe.
(3) A person who contravenes or fails to comply with a regulation made pursuant to this section is liable on summary conviction to a fine not exceeding £10,000.".
The purpose of the amendment is to establish the Cryptography Certificate Registration Authority. This is a crucial point. The Bill provides for electronic signatures. The person who sets up and gives out these signatures must be subject to some statutory control. I do not mind what State body would be involved, but it must be policed. I made all the arguments in favour of this on Second Stage. It cannot be left to the voluntary sector, be it a university or whatever. There must be a ministerial role.
I could go through the reams of debate on this in the House of Commons in the UK. The British legislation provides that the Secretary of State "shall" be the relevant authority. I understand the Department is reluctant to take on this role. It wants the good name for sponsoring the Bill but it does not want the arduous responsibility for the day to day handling of the provisions of the legislation. The wording of paragraphs (a) to (h) in the amendment may be imperfect, but it is taken from section 30 of the Bill, which deals with the establishment of a process for registration of domain names. The buck must stop somewhere if there is a security problem with the cryptography or with those giving out the electronic signatures.
The Deputy rightly says the amendment is inspired by Part I of the UK Elec tronic Transactions Act. That provides for a register. I met the British Minister responsible when she visited Dublin a couple of months ago. Subsequently, she is on the record of the House of Commons as stating that she does not wish to commence this part of the Act unless the self regulatory scheme being introduced fails. Under section 15 of the UK Act, if a statutory registration scheme is not set up within five years, Part I of the Act is automatically repealed.
Section 28 provides the Minister with the power to make regulations setting up a voluntary accreditation scheme for the issuers of electronic signatures. The National Accreditation Board has already put in place a pilot scheme. The section also provides that a supervisory scheme will be set up for such service providers and such a scheme should be in harmony with our European neighbours.
To date, there is little evidence of an emerging consensus on how this issue should be addressed. Under the EU directive, Ireland is prohibited from introducing any form of licensing or prior authorisation for such service providers. We do not wish to put up barriers which might preclude business. Interestingly – I do not say this for the purpose of self promotion – editorials inThe Guardian and the Financial Times have said that the British legislation is wrong while ours is right.
Who will be responsible?
It is self regulatory. The provisions outlined in the amendment derive from a section of the UK Act. However, it will not be implemented unless the self regulatory system does not work correctly. If it works correctly it will not be implement at all after five years. It will be repealed and put out of existence.
Under section 28 the Minister can make regulations setting up a voluntary accreditation scheme, of which there is already one on a pilot basis, at a national level and a supervisory one, set up also for such service providers. It would be better to see how matters proceed under self regulation.
The amendment states: "The Minister may . . .". That does not place on obligation on her, but gives her an option. The regulations would be made under section 3, where she has the power to make regulations in any event. Is there anything in the amendment that gives her any power or authority she does not have already under section 3?
The amendment is specific, whereas section 3 is more general in scope in that it gives the Minister enabling provisions. That is not to say that section 3 does not allow the Minister to act in this way if she wanted to. The amendment is specific in that it refers to the Cryptography Certificate Registration Authority.
The word "may" is used rather than "shall".
That is correct.
I move amendment No. 23:
In page 13, between lines 23 and 24, to insert the following subsection:
"(2) The full provisions of the Contractual Obligations (Applicable Law) Act, 1991, and the Jurisdiction of Courts and Enforcement of Judgements Act, 1988 to 1993, shall apply to all electronic communications and contracts as defined in this Act.".
The amendment seeks to confirm that two elements of the law – the Contractual Obligations (Applicable Law) Act, 1991, and the Jurisdiction of Courts Enforcement of Judgements Act, 1988 to 1993 – shall apply to all electronic communications. Is that the position? These are very important statutes.
I have consulted the Department of Justice, Equality and Law Reform and it is of the view that the provisions of these Acts apply equally to both paper and electronic transactions.
I move amendment No. 24:
In page 16, subsection (2), line 12, after "communication" to insert "and, subject to any contrary provision contained therein, the contract shall be deemed to have been made where and when the said acceptance was sent".
Section 18 deals with contracts. There is a curious omission in that the Bill provides that an offer may be accepted electronically, but it does not state where and when the contract is deemed to have been made. This issue is not dealt with in section 21, which deals with the definition of when a communication was sent. This is different from the definition of when the contract is made. Nor, according to my legal advice, is there power to determine the issue by regulation under section 3, which is too limited.
With regard to paper transactions, I understand that once acceptance of an offer is posted, the contract is concluded. The purpose of the amendment is to ensure that the contract is concluded when the response is sent, that is, when the communication has left the person who is accepting. Analogous to when a letter has been sent, when an acceptance has been sent electronically, there would not be a way the person could retract the contract. It seems to me that this section is not clear enough in terms of when the contract is transacted.
The Bill does not set out to establish new rules of contract law. Its purpose is to provide a legal framework for electronic commerce. We must keep in mind at all times that the purpose of the Bill is to allow for equivalence between written and electronic communication.
The purpose of Deputy O'Shea's amendment appears to be to add certainty and finality to the moment when an electronic contract is entered into. While this may at first seem to add finality and clarity, it would cause difficulties in a number of areas and situations because it would create a rule which does not exist for off-line contracts and would, therefore, unfairly discriminate against the on-line contract formation process.
To return to what I said about equivalence, it would cut across equivalence in that regard. The law of contract for all forms of contract, whether written or oral, is primarily governed by common law. It would be contrary to the principles of equivalence, therefore, to legislate differently for electronic commerce.
Section 21 deals with the time and place of despatch and receipt of electronic communications, but not the contractual consequences arising from that.
Deputy O'Shea's point was well made in a legal sense. Yesterday, I met Mr. Humphries and I meant to speak to him about this amendment because he is always very correct in the way he examines sections of Bills. It seems to me that if we keep the principle of equivalence in mind, equivalence in both on-line and off-line is what the Bill should provide for. We do not set out to bring into force new types of contract law. We set out only to give a legal framework for electronic commerce.
I take the point the Minister made, but if we accept the basis of what the Minister is saying, that the Bill does not seek to create new contract law, then in terms of equivalence if the Minister makes me an offer and I accept it in writing and 10 minutes after I send her the letter of acceptance I wish to change my mind, the legal advice available to me is that I cannot do that. Once the letter is on its way to the Minister, I have finalised the contract.
The equivalence is there in terms of e-commerce, in that if the Minister makes me an offer and I accept it by way of electronic media, then I cannot telephone her ten minutes later and say I do not accept this. This does not create new contract law but is a clear equivalence between what exists and what should be contained in the Bill by way of contract.
I see clearly what the Deputy is getting at, but this amendment is superfluous. Everything the Deputy said is correct and comes under the acceptance of equivalence in the legal framework of written contracts and electronic contracts. The Deputy's proposal is a reiteration of what is already the situation because what we are providing is the legal framework and the equivalence, and both are the principles of the Bill. The Deputy seeks to copperfasten the fact that the same tenets hold for one as for the other, but they do, because we are giving legal framework to it. It is a moot point.
To be clear on one point, supposing the Minister makes me an offer and I accept it by way of electronic media, under this Bill, if I change my mind ten minutes or an hour later, has the contract come into effect?
Yes. It is the same as if the Deputy posted his letter of agreement. Once it has left his hand, he has crossed the Rubicon.
I will withdraw the amendment at this Stage to re-enter it on Report Stage.
I oppose the section. Did I hear you correctly, that we are suspending at 2 o'clock? I had not been told.
It was stated on the Order of Business.
Section 19 relates to attribution of electronic communications. Section 19(1) allocates risk in commercial transactions in a new way unique to electronic communications. I will give two examples which may be of use. First, a forger creates an electronic communication, supposedly from a firm, offering to sell the forger goods at a particular price. If the forger seeks to enforce that offer, the burden of proof will fall on the firm to prove that it did not send the communication and that it is a forgery. Under current law, the forger would have the benefit—
Deputy, may I interrupt you? The Minister may have an observation to make on the section which might help.
The observation is that I accept the Deputy's proposal to delete the section. We conducted all sorts of trawls, etc. I also must attribute some of the credit for it to Senator Costello, who asked in the Seanad that I would look again at this when it came to the Dáil.
Amendments No. 25 and 26 are related and therefore amendments Nos. 25 and 26 may be discussed together by agreement. Is that agreed? Agreed.
I move amendment No. 25:
In page 16, subsection (1), line 25, to delete "Where" and substitute "Subject to any other law, where".
These are just technical amendments.
I move amendment No. 26:
In page 17, subsection (2), line 9, after "addressee" to insert "or the law otherwise provides".
Amendment No. 27 is consequential on amendment No. 28 and therefore amendments Nos. 27 and 28 may be discussed together by agreement. Is that agreed? Agreed.
I move amendment No. 27:
In page 17, subsection (6), line 27, after "subsection (5)" to insert "but subject to subsection (7)".
The Companies Registration Office pointed out that the current wording of the Bill allows only for two places of despatch and receipt, that is, a place of business and a place of residence. However, a number of Acts require documents to be sent to or despatched from a company's registered office. The purpose of these two amendments is to amend the Bill accordingly.
I move amendment No. 28:
In page 17, between lines 35 and 36, to insert the following subsection:
"(7) If an electronic communication is or is in connection with a notification or other communication required or permitted by or under an Act to be sent or given to, or served on, a company at its registered office, the registered office is taken to be the place of business of the company in connection with that electronic communication for the purpose of subsection (5).".
I move amendment No. 29:
In page 17, subsection (1)(a), to delete lines 45 to 47, and substitute the following:
"(ii) on the sole ground that it is not in its original form,".
This relates to the admissibility of evidence in court. I am advised by legal practitioners that this would improve matters and reflect current practice in court.