[kictanet] Legislation and Regulation for e-Commerce in Kenya

[Marcel Werner]

Legislation and Regulation for e-Commerce in Kenya

Kenya ICT Federation (KIF) - Briefing Note # 3  - Report - Public Panel 19
June 2008

*Electronic commerce (e-commerce) will add at least one percent point growth
to Kenya's overall economic growth within five years. This is contingent
upon the adoption of legislation that supports electronic transactions. *Kenya,
as an emerging economy and regional leader, lags behind in having a legal
framework for e-commerce in place. The current situation is an anachronism
hampering national development, placing provincial centres at a
disadvantage, and harming global competitiveness. Both external and internal
trade require the new framework.The Kenyan private sector strongly supports
e-commerce legislation, as well as legislation of the Information and
Communication Technology sector that guarantees an open market and promotes
innovation.

Why e-commerce law? Today, legislation supporting electronic transactions
represents the single most powerful innovation opportunity in the legal
framework of the ICT sector. Legislation is needed to:
-Legalize e-commerce transactions by recognizing an electronic signature
-Manage and control e-commerce risks
-Remove e-commerce barriers
KIF has studied drafts currently circulating in the public domain, the
Information and Communications Bill, 2008, and the Electronic Transactions
Bill, 2007, respectively, both of which are of the highest technical
standards. Public panels and hearings with sectors of the economy (including
tourism, agriculture, ICT) have been held on 6th and 27th May, 4th June and
19th June. The Kenyan private sector has expressed overwhelming support for
urgent legislation of e-commerce.

Suggested improvements in Bills - The public panels and hearings to date
have yielded the following important issues for improvement in the current
Bills:

-          Provisions on who can prosecute are missing

-          Liability of Internet Service Providers must be demarcated

-          Clarification on which commercial documents are excluded from
proposed legislation

-          Eliminate any ambiguity on admissibility of electronic evidence

-          Need for data protection and privacy provisions

-          The Bills are more lenient on e-commerce fraud than on
traditional fraud

-          Remove inconsistencies in determining crimes and punishments

-          Provisions for the inclusion of cyber-crime within the scope of
the Extradition Act

-          Creation of an Administrator for e-commerce laws whose functions
will be policy implementation and advisory, as a multi-sectoral body with
industry associations including KIF, lead regulator Communications
Commission of Kenya and co-regulator Central Bank of Kenya

Gains in tourism, agriculture, healthcare

Industry sectors, notably the tourism industry, are expressing their desire
to see e-commerce covered by law. In tourism, on-line travel bookings have
exceeded 80% in the USA and 50% in Europe. Decline in off-line bookings is
in ample evidence. Those destinations that cannot legally support abundant
on-line booking, such as Kenya, will loose market share. E-commerce in
agriculture will improve small-holder's living standards. Great impact is
expected notably in the coffee sector that provides livelihood to at least 5
million Kenyans, as well as in the dairy industry. Healthcare efficiency and
affordability will improve by on-line health data management systems.
Business operators in rural towns and rural centres have also expressed keen
interest, as they see scope to address issues of trade efficiency and
security in rural Kenya.

What is e-commerce

E-commerce is a method of trading that replaces paper-based documentation by
a mutually binding electronic protocol between buyers and sellers.
E-commerce is gaining ground globally and has become an irreversible trend.
Many trading partners are already practicing e-commerce, by mutual
agreement, also in Kenya. However, e-commerce will reach its full potential
when parties that do not know each other are able to trade with full mutual
protection under the law. This will benefit large numbers of consumers and
businesses, including small-holder farmers, tourism operators, small-scale
industry and services providers in almost any business sector.

About KIF

The Kenya Information and Communication Technology Federation (KIF)
represents the ICT industry with Government and with private sector bodies
e.g. Kenya Association of Manufacturers and Kenya Private Sector Alliance
KEPSA <http://www.kepsa.org/>. KIF is a legally registered membership based
Association, made up of trade associations and professional bodies within
the national ICT industry, as well as commercial corporations. KIF has been
accepted as the private sector voice of ICT by Government. KIF contributes
ideas to key sectors like healthcare, education, agriculture, construction
industry, and last but not least supports e-government development. KIF is a
membership-driven organisation. Members bring issues on public policy and
industry development forward for KIF to take action. Issues include:
innovation promotion, education improvement, duties, taxes and levies, rural
ICT investment. KIF has a strong and active network, with excellent
relationships with all government agencies. KIF membership is open for
market segment associations and individual companies. Membership charges are
annual and based on company size. Contact: secretariat at kif.or.ke, 020
4440102
MARCEL WERNER, Chairman, Kenya ICT Federation

please send any business mail to:
Marcel.Werner at innovation-africa.or.ke
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