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How to Increase Trust in e-commerce?

“Consumers must be empowered, protected and educated about their rights in order to enhance their trust in digital trade, as they play an important role in the achievement of the Sustainable Development Goals, in particular goals 8, 9, 10, 12, 16 and 17,” said UNCTAD’s Associate Legal Officer Arnau Izaguerri, at the E-commerce week 2017 held from 24-28 April in Geneva, Switzerland.

During a session themed “E-commerce and Consumer protection“, UNCTAD stressed the importance of consumer protection in creating an enabling environment for inclusive e-commerce. Key stakeholders identified areas where national and regional consumer protection frameworks and institutional capacities should be strengthened.

Today’s digital consumers have access to an unprecedented choice of goods and services. However, as great as the potential benefits of e-commerce are, there are still several challenges. Some challenges include: consumer protection, protection against cybercrime, protection from data breaches, unsafe products, unfair business practices, inadequate online dispute resolution, breaches to consumer privacy, and lack of coordinated action among governments.

“Consumer trust is paramount in achieving the inclusive and sustainable development of e-commerce,” said Mr Izaguerri, “all stakeholders must work closely together to ensure that no one is left behind”. According to a 2017 report released by Ipsos and the Centre for International Governance Innovation (CIGI), in collaboration with UNCTAD and the Internet Society, Internet users are increasingly concerned about their online privacy, with 49 % of users polled attributing their discontinuation of online shopping to lack of trust.

The survey results suggest that such lack of trust is hindering further development of the digital economy, but that this could be addressed through adequate consumer and data protection.

The report indicated that among those worried about their privacy, the top sources of concern were cybercriminals (82%), Internet companies (74%) and governments (65%).

“Following all the discussions around e-commerce week, it is clear that protecting consumers in the online context is a major factor in inclusive and sustainable development of e-commerce”, said Dr. Uwe Petry, Head of the Economic Affairs Division, Permanent Mission of Germany in Geneva, adding “The inclusiveness of e-commerce can be better achieved if we transit from eTrade for All to etrade BY All.”

Key outcomes and follow-up actions identified by participants:

Implementation of theUnited Nations Guidelines for Consumer Protection
Review and update of the legal and institutional frameworks to accommodate e-commerce. Supported by UNCTAD and development partners, this builds upon the work carried out in the OECD, particularly theOECD Recommendation on Consumer Protection in E-commerce.
Provide capacity building on online consumer protection to relevant stakeholders, particularly government officials, parliamentarians, judges, businesses and consumer organizations: with the support of UNCTAD and development partners. This is already the case with the ongoingCOMPAL, and UNCTAD-MENA capacity building programmes.
‘Network the networks’ and deepen international cooperation by using the Intergovernmental Group of Experts (IGE) on Consumer Protection Law and Policy. This group will share best practices and exchange experiences regarding policymaking and enforcement of consumer protection laws; policies in the digital economy among Member States. The IGE is best suited to incorporate the experiences of other existing networks such as ASEAN, African Consumer Protection Dialogue, FIAGC, GPEN, ICPEN, and OECD as it has a universal membership.

The Second Session of the IGE on Consumer Protection will take place from 3-4 July 2017 where a special session on consumer protection in e-commerce will be hosted.

Provide education and awareness raising to consumers and businesses on their rights and obligations when they engage in online transactions, through the dissemination of the Guidelines.

All of these measures should contribute to the establishment of trust boosting mechanisms in the online context such as Trust Seals and Online Dispute Resolution, through the development of partnerships between member States, businesses, consumer organizations and UNCTAD.

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