Opinion of the Committee of the Regions on the 'Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions on "A European initiative in electronic commerce"` (98/C 180/03)

THE COMMITTEE OF THE REGIONS,

having regard to the Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions on a European initiative in electronic commerce ();

having regard to the decision taken by the European Commission on 18 April 1997, under the first paragraph of Article 198c of the Treaty establishing the European Community, to consult the Committee of the Regions on the matter;

having regard to the decision taken by the COR Bureau on 11 June 1997 to direct Subcommission 3 'Telecommunications` to draw up the relevant opinion;

having regard to the draft opinion (CdR 350/97 rev.) adopted by Subcommission 3 on 13 November 1997 (rapporteur: Mr Latva-Rasku) (),

adopted the following opinion at its 22nd plenary session on 12 and 13 March 1998 (meeting of 12 March).

1. Introduction

1.1. The aim of the initiative is to encourage the vigorous growth of electronic commerce in Europe. It seeks to provide a coherent policy framework for future Community action and establish a common European position to achieve global consensus in international negotiations.

1.2. Building on the specific characteristics of European business and the diversity of Europe's social and cultural fabric, the initiative sets out a European approach to the development of electronic commerce in the global marketplace.

1.3. According to the Commission, there is a need to engage in a political debate aimed at encouraging the take up of electronic commerce. In addition, action must be taken to promote global interoperability, put in place a legal and regulatory environment consistent with single market principles, foster a favourable business environment and develop synergies between electronic commerce and electronic administration.

1.4. The Committee of the Regions takes the view that the expected rapid growth in electronic commerce will have a major impact at regional level and offer a wealth of opportunities for European consumers and businesses alike. Regions, national governments and European institutions should all be involved in policy action.

2. Gist of the communication

2.1. Electronic commerce entails both challenges and opportunities and covers a wide range of activities, some established but most of them new. The expansion of the Internet is having a dramatic impact on forms of trading and generating enormous potential.

2.2. The rapid implementation of direct and indirect electronic commerce poses a challenge to commerce, industry and governments in Europe. A necessary condition for electronic commerce is the development of efficient distribution channels.

2.3. The completion of the single market and introduction of the single currency will strengthen Europe's position in relation to its main competitors and encourage the expansion of electronic commerce.

2.4. A liberalized and competitive telecommunications market will foster the development of the telecommunications infrastructure required for electronic commerce.

2.5. It is necessary to ensure the global interoperability of electronic trading systems and the development of payment systems.

2.6. A coherent legal and regulatory environment must be established throughout the Community. The trust and confidence of consumers and businesses in systems must be ensured by paying particular attention to the deployment of secure technologies and conclusion of global agreements.

2.7. A favourable business environment for electronic commerce must be fostered by, for example, raising awareness, providing education and training and launching pilot projects. Public administrations have a key role to play in the rapid adoption of electronic commerce.

2.8. The specific actions set out in the initiative are part of a wider framework of information society initiatives and the Rolling Action Plan for the Information Society. The European Commission's political objective is to implement this coherent set of technological, regulatory and support actions, as a matter of urgency, by the year 2000.

3. Comments on the communication

3.1. General importance of electronic commerce

3.1.1. The COR points out that electronic commerce has a very important role to play in developing the information society and offers enormous opportunities for Europe.

3.1.2. The COR underlines the importance of exploiting Europe's strengths (e.g. cultural diversity, single market and single currency, strong technological and telecommunications infrastructure) in today's highly competitive global electronic marketplace.

3.1.3. The COR would remind the Commission of the vital importance of a coherent European approach to realizing the potential offered by electronic commerce.

3.1.4. The COR notes, however, that the rapid expansion of electronic commerce entails both opportunities (e.g. market expansion, improved level of services in remote areas) and risks (e.g. concentration of trade, widening regional disparities) for Europe's regions. There are also risks connected with checking the legality of goods and services, since commercial transactions on the Internet could give rise to problems as regards monitoring compliance with regions' own legislation.

3.2. Infrastructure, technology, services

3.2.1. The COR believes it is very important to reduce regional disparities in the cost, quality and accessibility of electronic commerce infrastructure and services so as to allow remote areas full access to global markets and overcome regional isolation.

3.2.2. The COR stresses the key role of the Structural Funds in reducing regional disparities and creating more equal opportunities for access to global markets.

3.2.3. The COR takes the view that it is important to promote the horizontal development of electronic commerce in businesses and public administrations in the regions in many sectors. Similarly, it is important from the regional point of view to foster conditions conducive to the adoption of electronic commerce related to rural industries and agriculture.

3.2.4. The COR considers it is essential to press forward with the standardization of electronic commerce in Europe so as to ensure global compatibility.

3.2.5. The development of user-friendly systems must be ensured through cooperation between businesses, consumers and the public sector, with due respect for cultural diversity and multilingualism.

3.3. Creating a favourable regulatory framework

3.3.1. The COR endorses the Commission's views on implementing a flexible legal and regulatory framework that meets the needs of businesses and consumers and will help to ensure rapid development, build trust and confidence and guarantee full access to the single market.

3.3.2. The COR thinks it is important to develop a common legal and regulatory framework that takes account of regions' differing cultural and social needs.

3.3.3. The COR takes the view that harmonization of banking rules, ensuring security for buyers, sellers and banks, providing protection for copyright and implementing rules on the establishment and rights of businesses are among the most important legal measures as regards building trust and confidence and ensuring access to the single market.

3.3.4. The COR believes that electronic commerce could cause problems for the functioning of local tax systems and controlling unlawful commercial transactions. The Commission document does not pay sufficient attention to these issues.

3.3.5. The COR feels that the single currency and an efficient and secure payment system will make a very positive contribution to the development of electronic commerce.

3.3.6. The COR stresses the need to establish a uniform legal and regulatory framework for electronic commerce at global level and the importance of the Commission's work in achieving this objective.

3.4. Promoting a favourable business environment

3.4.1. The COR agrees with the Commission that local authorities and regions have a key role to play in promoting the adoption of electronic commerce.

3.4.2. Municipalities and regions, which have first-hand knowledge of businesses and consumers in their respective areas, should support awareness-raising and the development of relevant skills and information network literacy. In particular, they should encourage SMEs to adopt new business methods, technologies and innovations.

3.4.3. In addition, the provision of information by business organizations to SMEs on the potential benefits of electronic commerce should be promoted by developing and publicizing pilot projects.

3.4.4. Creating conditions conducive to the take up of electronic commerce and exploitation of the potential it offers should be an integral part of regional and business development strategies.

3.4.5. Public administrations should foster regional development by adopting a positive and pro-active attitude to electronic commerce, for example, on the basis of the experience gained by Swedish local and regional authorities. The COR draws attention to the savings to be achieved by adopting electronic commerce in public administration at Community, national and local and regional level and to the positive effects of electronic commerce on competition.

3.4.6. The COR takes the view that public administrations have a key role to play at regional level in developing information network infrastructure, particularly in remote areas.

3.4.7. The COR emphasizes the wider choice which electronic commerce implies for consumers even in remote areas, but at the same time highlights the importance of maintaining supply and distribution channels and the potential threat which electronic commerce poses to local businesses.

3.4.8. The COR takes the view that it should play an active part in the current IDA programme on guidelines and measures relating to the interoperability of telematics networks in connection with the interchange of data between administrations and in other European projects for the development of electronic commerce.

4. Conclusions

The Committee of the Regions:

4.1. believes that the potential offered by electronic commerce is of major importance for regional development and strengthening cohesion;

4.2. considers that promotion of electronic commerce without frontiers should be built on the twin pillars of a uniform European system and a global viewpoint;

4.3. draws attention to both the opportunities and risks which electronic commerce entails for regional development;

4.4. feels that public administrations have an important role to play at regional level in promoting electronic commerce and creating conditions conducive to its take up;

4.5. underlines the importance of a common legal and regulatory framework for the trust and confidence of businesses and consumers in a rapidly evolving technical sector;

4.6. believes that the single market and single currency will make a major contribution to advancing electronic commerce and enhancing European competitiveness.

Brussels, 12 March 1998.

The Chairman of the Committee of the Regions

Manfred DAMMEYER

() COM(97) 157 final.

() As Mr Latva-Rasku is no longer a member of the Committee of the Regions, Mr Koivisto took his place at the plenary session on 12 March.