Spotlight on electronic commerce law and secured transactions in Colombo

• Two-day South Asian seminar organised by United Nations Commission on International Trade Law Regional Centre for Asia and the Pacific (UNCITRAL-RCAP, ICT Agency of Sri Lanka and Central Bank kicks off

By Kiyoshi J. Berman
The United Nations Commission on International Trade Law Regional Centre for Asia and the Pacific (UNCITRAL-RCAP) began its two-day South Asia seminar on ‘Electronic Commerce Law and Secured Transactions regime’ at the Colombo Hilton yesterday (18).
Chief Justice was Mohan Pieris PC whilst the Guest of Honour was Solicitor General and Acting Attorney General Y. Wijeyatilake PC.
Held in association with the ICT Agency of Sri Lanka (ICTA) and the Central Bank of Sri Lanka (CBSL), this seminar was the first-ever significant event of UNCITRAL hosted in Sri Lanka in more than 20 years.
The two-day seminar has brought over 15 foreign experts who joined their Sri Lankan counterparts to deal with a wide range of issues. International expert speakers from China, India, Japan, Australia, Singapore, Iran, Vietnam, the Maldives and Nepal as well as high level representatives from UNCITRAL, IFC (World Bank), UN ESCAP and the Hague Conference on Private International Law, are attending the seminar. Several Sri Lankan speakers will give the country perspectives to each session.
ICTA Chair and Advisor to the President Prof. P.W. Epasinghe said: “UNCITRAL is the core legal body of the United Nations system in the field of international trade law and a legal body with universal membership specialising in commercial law reform worldwide for over 40 years.”
UNCITRAL’s business is the modernisation and harmonisation of rules on international business. Trade means faster growth, higher living standards, and new opportunities through commerce. In order to increase these opportunities worldwide, UNCITRAL is formulating modern, fair, and harmonised rules on commercial transactions.”
He added: “Sri Lanka has been an early adapter to the UNCITRAL texts on Electronic Commerce. Sri Lanka became the first country in South Asia to sign the UN Electronic Communications Convention on 6 July 2006. The most relevant legislation for use of ICT in government and establishment of e-government services is the Electronic Transactions Act of 2006.”
Modernising laws
Guest of Honour Solicitor General and Acting Attorney General Y. Wijeyatilake PC in his address spoke about the situation that prevailed in Sri Lanka before the enactment of the Electronic Transactions Act No. 19 of 2006.
“Many years ago, I believe it was in the late 1970s, there was a famous case where an attempt was made to leak computer evidence. The judge overlooked the case and disallowed that application saying that ‘our ordinance to the admissibility of evidence do not provide for the admission of computer evidence’. Since then vast strides have been taken to rectify that anomaly that existed years go.”
He explained how the laws of Sri Lanka were modernised in order to accept computer evidence:  “The first step taken in the direction of computer evidence was the Evidence Special Provisions Act No. 14 of 1995. As far back as 1995 steps were taken to permit computer evidence in legal proceedings. There after the legal profession as a matter of course started taking application where ever it was relevant to take computer evidence.
“With the signing of the Electronic Communication Convention in 2006 further steps were taken to modernise Sri Lankan law. The Electronic Transactions Act No. 19 of 2006 is based on the standards of UNCITRAL, Model Law on Electronic Commerce (1996) and Model Law on Electronic Signatures (2001). This law was groundbreaking, it introduced features not known or considered before. Although the Special Provisions Act No. 14 of 1995 made provisions for computer evidence, the Electronic Transactions Act No. 19 of 2006 went miles further and it was a game changer.
“The offer and acceptance to be made electronically was legally enabled, that was specifically provided by the section 11 of this Act. Even though there were conflicts between these two Acts, the Electronic Transactions Act was supplementary for the Special Provisions Act.
“The secured Transactions Act 49 of 2009 was based on UNCITRAL legislative guide on secured Transaction but we also have a specific piece of legislation dealing with computer crime, that is Act No. 24 of 2007. Likewise we have several pieces of legislation specially providing electronic mode of activity. Sri Lanka is in the leading role of enacting and implementing laws relating to electronic transactions.”
UNCITRAL a method and a vision
RCAP Head of UNCITRAL Joao Ribeiro told the ceremony that UNCITRAL was not only a method but also a vision.
“The method and vision are both for legal technicians and politicians. From a technical standpoint, we have to imagine that lawmakers from around the world will meet in one room to discuss the complex issues involving business law and international business transactions. We have to imagine that those people will come to a common understanding of those issues by developing a common regulatory approach and at best agree on a common legislative framework that will ultimately govern a broad range of commercial transactions worldwide.
“For this to happen, more than imagination we need to have faith in the technical ability of those entrusted with the drafting of a world standard to distil the effort of several legal theories into a practical set of confection, in a satisfactory way in the very different legal, political, economical environments in which your trade is conducted. This is by all means a remarkable fit not only from a legal point of view but from a political one.”
International trade and ecommerce
Chief Guest Mohan Pieris, PC addressed the audience with his valuable thoughts on international trade and ecommerce.
“This seminar will prepare the grounds for Sri Lanka to ratify the convention. Although Sri Lanka was involved in the drafting of this convention and signed it in July 2006, we are yet to ratify.”
He explained the model laws of UNCITRAL and how it plays a major role in legal convergence, further highlighting UNCITRAL’s definition of uniformity: “Unification of laws in the end, would accomplish coordination of national private laws. However, it should be borne in mind that international conventions only have the force of law in Sri Lanka; it’s not the law but just a force. It has to be incorporated in to our national law by legislation.”
He also clarified that the mere adaption of a convention does not achieve harmonisation and concluded his speech by sharing observations and imparting a few words of encouragement to the audience.
ICTA role
ICTA Legal Advisor Jayantha Fernando said: “ICTA was established a little more than 10 years ago and at the time we started, we did not have any of the Acts except the ICT Act of 2003.”
He drew attention to the fact that ICT literacy at the time when ICTA was established was around 7-8% and Sri Lanka was away down according to the index which measures countries depending on the adoption of ICT on a policy perspective.
“When we embarked on this journey, we were at the 83rd position of the ranking of 115 countries but now we have come up to the 72nd position,” noted Fernando, who praised and thanked the UNCITRAL for their immense support extended to ICTA and for attending this event.
Electronic transactions
Following the inauguration the first panel themed ‘The UN Electronic Communications Convention’ moderated by João Ribeiro began. The keynote speech was delivered by Kuvera De Zoysa who addressed the ‘Impact of the Electronic Transactions Act on Civil & Commercial Law Proceedings in Sri Lanka’.
The speakers of this panel were Jeffrey Chan, Deputy Solicitor General, Attorney General’s Chambers in Singapore; Hong Xue Director of the Institute for Internet Policy & Law, Beijing Normal University in China and Jayantha Fernando, Director & Legal Advisor of ICTA.  Chan focused on the Singaporean laws on electronic transactions. He explained that numerous laws have been enacted to facilitate electronic transactions domestically in Singapore and that these enable criminalisation of computer misuse and admissibility of electronic evidence.
“The most significant of them all was the Electronic Transactions Act 1998. The main purpose of this Act is to provide for what is called functional equivalence for electronic communications. It means that there should be equivalence between the transactions done paper-based and on electronic communications. For example, if a transaction requires a signature, it should be equally accepted if it’s done electronically even though there is no physical signature on the transaction” he said.
Moreover, he explained in detail the Model Law on Electronic Commerce (MLEC) and the Electronic Communication Convention (ECC) and the process of adopting these in Singapore, the issues encountered and the exclusions.
Impact of UNCITRAL texts
The impact of UNCITRAL texts in authentication frameworks was also discussed yesterday. This session illustrated how UNCITRAL texts have helped influence the formulation of national policies and practices in setting up technology neutral authentication frameworks and how such policies and practices have helped improve e-Commerce and e-Business.Moderated by Jayantha Fernando, the session saw Lanka Clear CEO and General Manager Sunimal Weerasuriya delivering the keynote address on the impact of legal regime in setting up a sector specific certification service provider for banks.
Panellists were Jae Sung Lee, Legal officer, UNCITRAL Secretariat, Tahseen A. Khan, Controller of Certifying Authorities, Department of Electronics and and Information Technology, Ministry of Communications and Information Technology, New Delhi, India, and Rohana Palliyaguru, Operations Manager – Sri Lanka CERT, National Certification Authority framework in Sri Lanka. The impact of UNCITRAL E-Commerce texts in commercial arbitration was also discussed yesterday taking stock of the implementation of the UNCITRAL E-Commerce texts and its impact on international commercial arbitration practice.
Arbitration and enforcement
Investment Promotion Deputy Minister Faiszer Mustapha PC delivered the keynote focusing on the impact of Sri Lankan electronic transactions regime on arbitration and enforcement of awards. The panel comprising Qisheng He, Professor, Wuhan University, China, Chanaka De Silva, Partner, Nithya Partners, Sri Lanka, Ali Sabry, President’s Counsel, Sri Lanka, and Indira Nanayakkara, Head of Department of Commercial Law, University of Colombo, Sri Lanka was moderated by Kuvera De Zoysa, PC.
Regional perspectives
The last session of the day was on regional perspectives on the adoption of UNCITRAL as experts focused on regional experience in the implementation of UNCITRAL texts on e-commerce and to assess the potential for future developments, with particular regard to adoption of the UN Electronic Communications Convention.
The panel included Saeed Habiba, Associate Professor, University of Tehran, Iran, Abdul Rasheed Ibrahim, Assistant Commissioner, Customs Service, Malé, Maldives, Huong Dieu Nguyen, Officer, Ministry of Industry and Trade, Vietnam, and Joy Cheng, Officer, Attorney-General’s Department, Australia. It was moderated by Hong Xue.
Today’s sessions
Today the seminar will see an opening statement by Navin Dissanayake, Minister of Public Management Reforms, followed by sessions and panel discussions on UNCITRAL texts on Secured Transactions (with reference to UNIDROIT and Hague Conference texts) with the keynote by Central Bank Deputy Governor Ananda Silva and panel moderated by Nihal Fernando PC. Panellists will be Jae Sung Lee, Legal officer, UNCITRAL Secretariat, Anselmo Reyes, Representative Hague Conference on Private International Law, Asia-Pacific Regional Office and K.A. Janaka Lakmal, Deputy General Manager, CRIB, Sri Lanka.
‘Domestic and Regional implementation of Secured Transactions’ will be taken up in a panel moderated by Elaine Maceachern, Senior Specialist, Secured Transactions – Asia. And Pacific, IFC with experts comprising Chaminda Hettiarachchi, Deputy General Manager Legal, Central Finance PLC, Hiroo Sono, Professor, University of Hokkaido, Japan and M.R. Umarji, Partner, Alliance Corporate Lawyers, India.
Separately the theme ‘Towards implementation of ESCAP Resolution 68/3: Enabling paperless trade and the cross-border recognition of electronic data and documents for inclusive and sustainable intraregional trade facilitation’ will be discussed as well.
Dayanath Jayasuriya, PC will moderate the panel comprising Yann Duval, Chief of Trade Facilitation, Trade and Investment Division, UNESCAP, Jae Sung Lee, Legal officer, UNCITRAL Secretariat, A.W. Sudattha I Silva, Superintendent of Customs (ICT), Sri Lanka Customs and Manohar Bhattarai, Senior Advisor, Computer Association of Nepal. The final panel in the form of Round Table Discussion and Conclusions will be moderated by jointly by Jae Sung Lee and Dr. Rohan Perera, PC with discussants being Aritha Wickramanayake, Precedent Partner, Nithya Partners (Lead Discussant), Farzana Jameel, Deputy Solicitor General, Sri Lanka, Milinda Gunatilleke, Deputy Solicitor General, Sri Lanka and Lasantha Hettiarachchi, Attorney-at-Law. ICTA CEO Reshan Dewapura will deliver the closing address after the concluding statements from ICTA Legal Advisor, Jayantha Fernando and Head of UNCITRAL RCAP, Joao Ribeiro.
Pix by Upul Abayasekara