Mr BAIRD (11:36 AM) —I rise to support the Electronic Transactions Bill 1999 . I commend the government and the Attorney-General for their initiative in bringing this proposal forward. There are few areas of the world economy which have transformed it to a greater degree than the use of e-commerce. E-commerce has revolutionised the way we do business around the world. It is appropriate that the government captures those changes and looks at the various processes in terms of purchasing and the way business is done, both in Australia and internationally, and recognises those changes to ensure the validity of the system and of transactions which are made and also the security of the whole system, making it more possible that we have uniformity of legislation throughout the country so that everyone is operating on the same agenda. Obviously, there are some developments that will take a while for all to come on board, particularly in terms of bringing about uniformity among the various states. But this will provide the overall agenda within which states can coordinate their own legislation to conform with this model.

It is interesting that we have a delegation here from the UK, a country which has a reputation for developments in terms of e-commerce and the use of the Internet generally. It is particularly encouraging to see the role that Australia has been taking in e-commerce. Japanese officials have commended the Attorney-General, saying that Australia is now considered as a world leader in Internet legislation. The high degree of computer literacy in this country, the great degree to which the Internet is accessed by Australians, puts us second or third on a per capita basis in use of the Internet and of computers. We should use that to put us at the cutting edge in terms not only of competitive advantage but also of legislation that can be enacted in this House.

This bill provides a strategic framework for the development of the information economy in Australia. It is designed to move businesses towards having the same level of confidence in their electronic transactions as currently they have in paper transactions. The elevation of the information economy to a cabinet position, under the Hon. Richard Alston, reflects the importance the government attaches to information technology. Certainly, Australia's comparatively high level of readiness for the millennium bug and the introduction of legislation like the Broadcasting Services Amendment Bill—the result of an inquiry by the Senate Select Committee on Information Technologies—demonstrate that we are on top of the game. These highlight the attention that is being paid to ensuring Australia enjoys social benefits, as well as technological benefits, from these changes.

The government is eager that access to the Internet be restricted where appropriate—in terms of children, in relation not only to pornography but also to the display of bomb making techniques, for example. On the one hand, we want appropriate restrictions to be in place to restrict access by children. On the other hand, we want to make certain that we develop common standards and ensure standards to improve the system worldwide. The technology revolution is transforming the whole way in which business is done at the start of the new millennium, and we can only imagine what it is going to be like into the 21st century.

The growing importance of e-commerce cannot be underestimated. It is the most significant change that we have had in the last 50 years. The World Trade Organisation's role has been significant. Australia has taken a leading role in that organisation and we have been the leading advocates for the Internet Corporation for Assigned Names and Numbers, or ICANN, which will police the outlets through which goods will be sold.

Of course, we are most concerned that Australia is well placed to enjoy the benefits that come from our high level of computer literacy and adoption of computer technology. At this stage we are keen to encourage the use of electronic technology in business transactions. I notice that in the new tax system we are also requiring that large corporations make their payments of tax electronically, and I believe we are going to see that spread across the board. In terms of dealing with government agencies, there is an encouragement that as companies interface with government we should progress, to a much more comprehensive basis, the interaction through electronic means.

This bill is going to remove many of the doubts that currently exist regarding the legitimacy of these transactions. Those doubts are with regard to the writing, signing, and originals in relation to documentation. The bill is based on the principles of functional equivalence and technology neutrality. Functional equivalence is the equality under law of the treatment of paper and electronic communication. Technology neutrality is the non-discrimination between different forms of electronic communication.

In general this bill has three functions. Firstly, it validates the use of electronic transactions other than verbal contract engaged through the use of a telephone. Secondly, it gives electronic signatures the same status as written ones. Thirdly, the receipt of transaction is defined when the electronic communication entered the recipient's system, rather than, for example, when an email was sent.

There have been some comments made about various aspects of this bill and the shadow Attorney-General has raised some of these issues. Critics of the bill have focused on its limited scope and that it only applies to the law of the Commonwealth. It was considered that there should be a total generic bill in which the Commonwealth would take a far more expansive view of Commonwealth power in dealing with another e-commerce issue, year 2000 disclosure. It may be possible that there could be lengthy delays until identical state and territory legislation is enacted, which could hinder the development of e-commerce in Australia. The fact is, however, that the government has taken a cautious approach in terms of the constitutional powers and has opted for a uniform national scheme instead of a single piece of Commonwealth legislation, as recommended by the EGEC.

While there was initially some concern that some states might depart from the uniform framework, in May 1999 the states decreed at a meeting of the Standing Committee of Attorneys-General to draft complementary laws based on the Commonwealth bill. That seems to be an appropriate way to go. It is not unusual. We have similar examples of this, where the Commonwealth enacts the primary piece of legislation and complementary bills are brought simultaneously into each of the state houses. I think it is important there is state ownership of each of these pieces of legislation, that they developed their own access in terms of their own involvement with e-commerce in each state. So these criticisms are basically ill-founded and fail to recognise the fact that that was a decision taken not by the Commonwealth but by the Commonwealth government in concert with the states, which believe this is the more appropriate way to go.

The second criticism was that only certain Commonwealth laws would be captured by the bill. Until 1 July 2001, it will only apply to laws made subject to the bill by regulation. After that date, Commonwealth laws may be exempted by regulation. The fact is that, while people want everything to be done at once, it is important that there is appropriate lead time for the agencies. This is a reasonable lead time. It is a significant change in the way that agencies and various departments do business, so that time allows them to coordinate their efforts. It is one thing to say, `Let's do it all at once.' It is another thing to introduce legislation and be caught by agencies not being prepared. It is appropriate that we have a smooth transition. This will be with us for a long time. It is important we get it right and that the agencies are ready for this. Also, after 1 July 2001 this bill will apply to all areas of government activity, not only those where specific regulation has been made for electronic commerce, so it is a totally revolutionary approach. If we think of the changes that have occurred in the way that the government does business over the last century, this is amongst the most significant changes that we have seen.

The bill has also come under criticism for doing little to solve the uncertainty of electronic commerce. For example, clause 10 provides that, if there is a requirement for a signature under a Commonwealth law, an electronic communication may meet this requirement if, amongst other things, the method used was reliable. The recent announcement by the government of the establishment of the National Electronic Authentication Council may go some way towards solving this problem. NEAC will oversee the development of a national framework for electronic authentication of online activity. It will not require that a particular form of digital signature be used, but will oversee the development of technical standards and codes of practice. This measure will add to consumer confidence.

Obviously, authentication of signatures is a vexed problem. While no-one is offering magical solutions at this point, it is an evolving process and NEAC's suggestions as to how it can be verified seem an appropriate way to go. Other comments on this have been that the enactment of a legislative framework for electronic commerce may also require the enactment of data protection legislation to ensure privacy. I think we are all concerned about aspects of privacy, and it is only appropriate that we should raise those questions.

In December 1998, the Minister for Communications, Information Technology and the Arts and the Attorney-General announced the government's intention to develop legislation to support a self-regulatory regime for privacy protection. The government is currently engaging in a program of consultation. According to the Attorney-General:

The legislation will support businesses that self-regulate to strengthen privacy protection and provide a default legislative framework. Self-regulatory privacy codes will be able to be approved by the Privacy Commissioner and have the same force as the legislation. Where there is no approved privacy code default legislative principles and a complaint handling regime will apply.

It has been argued that such a measure is needed to facilitate e-commerce with members of the European Union in the wake of the data protection directive in October 1998. The EU directive prohibits the release of personal information online into jurisdictions that do not have adequate data protection arrangements.

I think it is appropriate that all members should have regard to the question of privacy; it is going to be an ongoing development. As we see the burgeoning of e-commerce, it will be something that we as parliamentarians will need to protect. It obviously provides an opportunity for those who would want to exploit it to make us vulnerable in terms of privacy issues, so we as parliamentarians must constantly monitor that aspect of it.

Overall, it is a significant step forward. It is quite a major breakthrough in the way we do business not only by empowering the private sector and providing the necessary safeguards but also by providing the necessary framework in which the government can move into the new electronic era, which will be the way we all do business in the new millennium.