The Growth and Development of E-Commerce: An Analysis of the Electronic Signature Law of Sri Lanka'

Abstract

A significant event in the legal regulation of e-commerce in Sri Lanka was the enactment of the Electronic Transactions Act in 2006. The objective of this important Act is to facilitate commercial and financial activity by removing barriers to electronic transactions and by preserving the right of individuals to engage in freedom of contract unimpeded by government regulation and bureaucracy. This objective is secured in the legislation by ensuring that transactions conducted electronically are regarded as of equal validity or legitimacy as normal paper (or documentary) transactions. Undoubtedly, the Electronic Transactions Act is a significant and quite innovative piece of legislation – one that that has considerable potential to both stimulate and further enhance economic development, as well as commercial and free enterprise activity, in a developing country like Sri Lanka. Before any form of private-sector activity or financial activity can be conducted, the necessary institutional and legal underpinnings must be established. This Act appears to be the first step towards providing the foundations of a flourishing free-market economy in Sri Lanka. In light of these issues, this article provides an overview of the fundamental provisions of the Act and outlines its significance for the country's emerging e-commerce activity. It draws attention to certain inadequacies of the Act and briefly focuses attention on the impact of the new e-commerce laws on the economic success of Sri Lanka. This article also briefly explores other associated and parallel legislative developments in Asia that aim to promote e-commerce in the region with a view to drawing out common and emergent themes in relation to the regulation of e-commerce in developing nations.