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Wednesday, 24 June 1998
Page: 5244

Mrs STONE (10:29 AM) —by leave—I too want to comment on report 360, Internet commerce—To buy or not to buy? of the Joint Committee of Public Accounts and Audit. I think it is a very important contribution to the development of the debate on consumer protection and privacy issues in particular in relation to the growth of Internet commerce. This is the way of the world for the next century. It will be a case not only of using your mail system for catalogue buying to supplement access to local commercial outlets but also of being able to sit at home and tap into your computer on the Internet system to undertake purchasing, selling and making inquiries. The Internet inquiry included in its terms of reference:

(f) the current frameworks for consumer protection and the protection of intellectual property

This is particularly important, as is the policy approach that has been taken by other countries and the scope for international cooperation.

Clearly the Internet is borderless. You can sit in your own home or at your place of business and tap into the attempts to conduct commerce around the globe. At the moment we have very few policy frameworks or options to regulate the protection of intellectual property in particular or the privacy concerns that are paramount when individuals try to interact with another partner or, per haps, look at joint venturing in another place via the Internet.

Chapter 7 teases out these issues of consumer protection and privacy issues. For example, consumer protection privacy issues for Internet commerce users were seen as key not only in Australia but also in the United States. It is obvious that consumers too must have a sufficient level of confidence about payment and security systems as well as knowing that privacy standards are adequate. During the committee's round table forum, participants identified security, privacy, identification and authentication as key issues requiring further development. I commend anyone who is at all involved in Internet commerce in Australia to look hard at this report, and in particular chapter 7, to understand what the issues are and what some other nations are already looking to for solutions.

The consumer and business issues relating to security, privacy and authentication are amongst some of the most important issues, and surveys have repeatedly shown that these may, in the future, be some of the stumbling blocks for this new dimension of Internet commerce reaching its full potential. For example, the Australian Consumers Association advised the committee that a recent survey of American consumers showed that in the US privacy was the No. 1 concern.

At the consumer level, it is likely that consumers will be given the options to provide personal and private data, often in return for inducements by advertisers and marketers. Once you have given that sort of information, what guarantee is there that your private details are not on-sold to some other agency or business activity that can use that information to target you with quite a deal of unwanted information? Perhaps it could end up in a situation of harassment.

The potential for unauthorised access to private information by third parties through the Internet is significant, and currently it is unlikely that such access can be completely stopped. It is also impractical for businesses to completely stop breaches of security from within the business or from the Internet. We always have to remember that the beauty of the Internet is its accessibility. To try to clamp down on access to the vast majority of potential participants in itself would be to curtail one of the great benefits of Internet commerce. On the other hand, we have to somehow find a balance.

The Internet is an open system. It was never designed with security as a priority. There is evidence to suggest that consumers are, however, reluctant to purchase goods and services over the Internet because of concerns not only about payment systems and consumer protection issues such as redress and compensation and the reliability of retailers but also about where their personal details might end up.

The jurisdiction in which the supplier is located may have consumer protection laws but the process for an Australian consumer to activate these laws may be complicated and costly. The Australian Competition and Consumer Commission states:

Unfortunately, difficulties with enforcing protection legislation in the global marketplace means that the current regulatory framework for internet commerce may not be sufficient to give consumers the degree of confidence they need to accept the internet as a safe means of commerce.

The ACCC suggested a range of alternative consumer protection strategies to improve consumer confidence and these are carefully documented in the evidence that was provided to the Public Accounts Committee.

First is the need for coordinated law enforcement and compliance strategies. It is all very well to talk about coordination, but with the Internet we are talking about global and, in Australia, interstate coordination. International cooperation by law enforcement agencies could help to improve the Internet commerce environment. The ACCC, together with similar law enforcement agencies, told this inquiry that they have already conducted international Internet sweep days whereby enforcement agencies surf the Internet for scams such as get-rich-quick schemes and inform the operators of web sites about the existence of consumer protection legislation in participating countries.

As well, the ACCC suggests that there should be industry based solutions, that they will in fact be an important element of any overall solution to the consumer protection problems associated with Internet commerce. Of course, self-regulation is always ideal where those who wish to conduct commerce on the Internet can see that if there is ever a substantial loss of confidence in the Internet commerce then all will be losers, all will be the poorer.

In the absence of the practical option of traditional regulatory regimes to operate in the global marketplace, there has to be the development of a new policy framework. That is obvious. That framework should deliver many of the levels of protection consumers traditionally expect but without, on the other hand, shutting down parts of the system for easy access to those who want to participate. In Australia we have the complication of interstate trade laws, and it is quite clear that the FBCA warns that transactions across state and territory borders may require additional coordination between Australia's fair trading agencies.

This is a very important report. It looks at the potential of growth for Internet commerce. In a country like Australia, as the previous speaker said, we have the tyranny of distance. We have those who have very little access to a range of shopping facilities or innovative services that can only be had at the moment by surfing the Internet and looking through the window of other people's experiences globally. One of our problems of making sure that the tyranny of distance is overcome with Internet commerce is to make sure that our own telecommunications infrastructure comes up to speed.

At the moment, while some of the greatest advantages for Internet commerce are for those who are located in regional Australia, we have the poorest ability for people to access the Internet. The time it takes for them to get on and the cost of using Internet is often prohibitive. That dimension which was not a focus of this report, but it is one of those real issues which this government is addressing, in particular, through some innovative funding, like the $5 million recently given to the National Farmers Federation to specifically explore Internet access for regional and remote Australians. I am happy to mention in relation to this whole business of Internet commerce that some $660,000 is now being spent in the Cobram area of the electorate of Murray to explore how access to Internet in particular can be improved for those whose infrastructure is aged and not of a standard you would expect to find in a metropolitan area.

Report No. 360: Internet commerce—To buy or not to buy? is a substantial piece of work. I commend all of those who worked very hard on this report. The report will obviously be of great significance to all of those who wish to develop Internet commerce for Australia so that it delivers benefits. All of the difficulties associated with such innovative technology need overcoming. They need new policy frameworks, but this government will work to make sure that those new frameworks are delivered.