Panel: E-commerce growth faces international hurdles

By Patrick Thibodeau, Computerworld |  Business

International markets can spur e-commerce growth for U.S. companies, but a State Department official warned today that regulatory and trade hurdles could cripple that expansion.

Orde Kittrie, the global information economy coordinator at the State Department, said international regulatory and logistical hurdles "are so discouraging that major retailers simply refuse to ship outside of the U.S."

Moreover, if foreign governments pressure companies to control Internet content -- something a French court successfully did to Yahoo Inc. for allowing the sale of Nazi memorabilia on its online auction Web site (see story) -- "the Internet may soon grind to a halt," Kittrie said.

Speaking today at a National Press Club-sponsored forum on issues affecting e-commerce, Kittrie said other nations can best spur the growth of e-commerce through "new policy and laws that will encourage innovation and investment."

"The reality is that these benefits will flow to those who welcome them," said Kittrie. He cautioned that he wasn't speaking for the Bush administration, which has not yet adopted a formal e-commerce policy.

Kittrie stressed that there is ample room for international e-commerce growth, noting, for instance, that there are now more Internet users in New York City than in Africa, and that most of the world's online users today live in Europe and the U.S.

But national policies can hurt e-commerce development.

In China, the government wants a tight rein over the ability of Chinese residents to register domain names, said Miriam Shapiro, a panelist at today's discussion who is director of international policy for development at VeriSign Inc. and its Network Solutions Inc. affiliate.

"This can make it more difficult for people and businesses to participate more fully in the global marketplace," she said.

Taxation, customs laws and security and general regulatory matters such as privacy all affect e-commerce globally. But some companies thrive, despite a clash of cultures.

EBay Inc. operates extensively in Europe, said another panelist, Rod Cohen, who is the company's director of government affairs. Although eBay must follow European Union privacy directives, it has found that online self-regulatory privacy standards in the U.S. are equal to, if not better, than European Union law.

Cohen said it's a "myth" that European privacy standards are tougher than the ones in the U.S. He added that he hopes the Bush administration will follow the policies of the Clinton administration, which sought to reduce trade barriers worldwide.

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