Gibraltar Enacts Electronic Commerce Ordinance 2001

Jason Gorringe, Tax-news.com, London

12 March 2001

Less than a month after the appointment of Darion Figueredo as its full-time E-business Development Officer, Gibraltar has moved closer towards fulfilling its e-commerce ambitions. The Electronic Commerce Ordinance was passed on March 5 by the Gibraltar parliament, the House of Assembly, and is viewed as an important step in Gibraltar's development as an e-commerce hub to rival its nearest competitors, such as Guernsey, Malta and the Isle of Man.

The legislation facilitates the use of electronic means for transmitting and storing information and affords legal recognition to transactions effected electronically. It also provides a framework for the accreditation of electronic signatures and determines the activities and liability of service providers.

A press release from the Gibraltar government said it 'will seek to continue to provide e-commerce operations within a fiscally attractive environment. The treaty exemption from VAT enjoyed by Gibraltar is likely to gain importance, especially in the provision of services and other non-physical products.'

The main provisions of the Electronic Commerce Ordinance 2001 are as follows:

Part 1 – Information Society Services

This part contains important definitions that are pivotal to the main body of the legislation. In particular definitions are provided for “service provider”, “established service provider”, “information society services” and “intermediary service provider”.

Sections in this part include, Interpretation, General requirements for service providers, Commercial Communications, Contracts concluded by electronic means, Information in relation to and conclusion of electronic contract. Approved codes of conduct and prescribed standards.

Part 1 provides for the general requirements of service providers and various exclusions of liability in specific circumstances. Section 8 provides that a service provider is not subject to any civil or criminal liability in respect of the information contained in a data message if either he was not the originator of the message, has not modified the message in any way, has no actual knowledge that the information in the message could give rise to criminal liability or follows the procedure set out in section 9 which explains the procedure for dealing with unlawful, defamatory, etc information.

Power is also given to approve codes of conduct for intermediaries and other persons who use electronic means to provide goods, services or information.

Part 2 – Issue of Accreditation Certificates for Electronic Signatures

This part contains the following sections: Interpretation, Approved providers of accreditation certificates, Code of conduct for approved certification service providers, Grant, refusal and revocation of approval, Legal effect of electronic signatures, Code-names, Liability of intermediary service, Code of conduct for approved certification service providers.

Part 2 establishes the framework for the authorisation and recognition of certification service providers. Applications for authorisation are to be made to the Minister for Trade, Industry and Telecommunications in the manner prescribed in sections 12 & 13. The recognition of overseas providers or classes or classes of such providers is dealt with through notice in the Gazette in the circumstances set out in section 14. Sub-section (2) provides the basis upon which recognition is granted. The Minister will not recognise an overseas provider or class of such provider, unless it is established either within the EU and the body giving the authorisation is designated for that purpose in accordance with the relevant law of a Member State, or in a territory and by a body that for the time being are prescribed for the purposes of this Part.

Section 15 outlines the legal effect of electronic signatures supported by an accreditation certificate and Section 17 deals with the civil liability of approved certificate providers. Subject to certain qualifications, the section imposes a duty of care on approved certification providers in favour of any person who reasonably relies on the accuracy of the accreditation certificate and provides for an action in damages in respect of any loss or damage suffered by reason of a breach of this duty.

Part 3 – Transactions Effected by Electronic Means

Sections 19 & 20 deal with the requirements to present or retain originals and to produce documents. Section 21 outlines the conditions for retention of documents etc, in electronic form.

Sections 22 & 23 make provision for various important issues including the admissibility and evidential weight of data messages in legal proceedings and matters relevant to the concluding of contractual obligations through electronic communication.

Part 4 - General

This part contains a number of general provisions. Section 24 provides that in the prescribed circumstances an offence committed by a body corporate may be attributed to any director, manager, secretary or similar officer.

Section 25 introduces a general power for the making of any necessary regulations by the Minister and section 26 extends the restrictions on service providers.

The Electronic Commerce Ordinance forms part of a wider strategy by the government to transform Gibraltar into an international e-business centre. The fact that the Ordinance contains provisions on electronic signatures and other EU directives is highly significant. Taken together with the liberalisation of telecommunications, it should stand Gibraltar in good stead when it comes to attracting e-business to the Rock.

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