Standing up for Canberra

Electronic Transactions Amendment Bill 2011

I am pleased tonight to rise to speak in support of the Electronic Transactions Amendment Bill 2011. This bill proposes legislation that in some respects is undramatic and may not generate great controversy, but it is a small part of the gradual reform and reshaping of the business environment that is so crucial to Australia’s future prosperity. Indeed, it is salutary for us sometimes to delve a little more deeply into the more quotidian details of some of the grander big-picture images that we are accustomed to use. I believe that this bill can provide us with such an opportunity to understand better the complexity and interrelationships in the modern business environment and the challenges it brings.

We are all familiar with talk of the digital environment—of cyberspace—but we need to reflect a little to see how dramatic has been the change in the environment in which we do business and reflect on how we carry out financial transactions within that environment. So accustomed have we all become to buying goods online, making financial and banking arrangements on the net and using handy and widely accepted methods such as PayPal that we rarely think about the underlying structures of these systems and the legal frameworks that surround them, bind them and manage them.

This bill is very much about the digital economy, a term we hear often, but I wonder whether there is sometimes an inclination to think of the digital economy as somehow a separate part of the economy, exclusive to geeks or video gamers, as one leading member from those opposite seemed to think at one time. But the digital economy is widespread. Anyone familiar with what might be thought of as ‘old economy’ industries such as agriculture will know that the sophisticated use of information technology is commonplace. So we are all involved in the digital economy, at least in a sensibly broad understanding of that term.

This bill also illustrates the value of international cooperation and rule-making. The amendments we are considering will allow Australia to accede to the United Nations Convention on the Use of Electronic Communications in International Contracts. The convention enhances legal certainty and commercial predictability but does not purport to vary or create contract law. This convention is an important element in international trade law and facilitates international trade. The convention was developed by the United Nations Commission on International Trade Law and is the first United Nations convention addressing legal issues arising from the digital economy. Accession to the convention requires amendments to the domestic electronic transactions regime, and each Australian jurisdiction has implemented legislation based on the UNCITRAL Model Law on Electronic Commerce 1996, which was also developed by the United Nations Commission on International Trade Law. The convention updates the model law on the basis of a better understanding of the use of electronic communications since the model law was finalised.

Australia has long been a strong supporter of a robust international trading system. It has been the basis of our economic prosperity and will continue to be. This bill is a small part of Australia’s ongoing commitment to an open and free international trading system, but those familiar with our federal system will know that sometimes cooperation is required within a smaller sphere and that this has historically proved at least as difficult as cooperation in the international sphere. The enterprise of which this bill is part provides an example of the states and territories working towards the same ends and is one of the Gillard government’s many harmonisation, consolidation and streamlining efforts. The bill was approved by the Standing Committee of Attorneys-General, and New South Wales and Tasmania have already passed the amendments to allow it to be applied. Others are also intending to update their electronic transactions legislation. Stakeholders in the business community and other interested parties have also been consulted and are supportive of the proposed amendments.

We often talk about taking some aspect or other of Australian life into the 21st century—it is common parlance. This is shorthand for two important insights. The first is that, since we can no longer try to deny that globalisation has brought the whole world into a closer relationship, we always need to be aware of what is happening in the world at large and of what changes are occurring and to take action to ensure we benefit to the full from this globalised world and this globalised relationship. The second stems from recognition of the increasing rate of technological change. We all know of Moore’s law, which broadly states that the computing power available to us doubles roughly every two years. But even Moore’s law seems modest when we take into account the explosion in software and hardware that we are witnessing. I know from my time consulting in Defence that in some areas software becomes outdated in months and sometimes in weeks but not in years anymore. With this understanding of what lies behind the expression ‘Moore’s law’, this undramatic and modest bill does take Australia into the 21st century. The amendments we are considering achieve small but important clarifications on the details of using electronic means of communication. These include such matters as the date and time of the formation of a contract; clarifying that a contract can still be legally effective despite having been formed by an automated messaging system; reliability of electronic signatures; and determining the place of business of the parties to a transaction. We may not even be aware of these details when we use the internet to update a subscription to a magazine or buy that must-have vintage frock on eBay, but they are essential.

I note that measures such as this, which improve the environment in which business and households can operate online, are of special interest to the Australian Capital Territory region and the people of my electorate of Canberra. According to the Australian Bureau of Statistics, as of June 2009, just over five million households nationally had broadband and, of these, the Australian Capital Territory continued to have the highest proportion, with nearly three-quarters—74 per cent—of Australian Capital Territory households connected. This is one of the reasons we are so excited about the NBN and eagerly anticipate its arrival and strongly support it.

This high level of penetration is also reflected in the energetic community of businesses in the ACT, including small and micro businesses—one of which I used to own—which work in the information technology industry, the animation industry, the film industry, the defence industry and a whole range of other industries. Eighteen countries have now signed the UN convention that underscores this bill, including significant trading partners such as the Republic of Korea and Singapore. So, for reasons local, national and international, I am very pleased to commend this bill to the House.

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