The first principle is that the private sector should be allowed to take the lead. Although the Government played a significant role in financing the initial research and development of the Internet, the White House believes that its subsequent expansion has been, and should continue to be, driven primarily by the private sector. The Framework takes as a fundamental principle the notion that innovation, expanded services, broader participation, and lower prices will arise in a market-driven arena. The natural outgrowth of this first principle is seen in the Federal Government’s hesitance to issue any regulations governing the use of the Internet and its encouragement of private sector self-regulation. The second principle in the Framework is really a corollary to the first principle and provides that the Government should avoid undue restrictions on global electronic commerce. This principle is based on the belief that unnecessary regulation of commercial activities on the Internet will distort the development of the electronic market-place by raising the cost of products and services for consumers the world over. According to the third Framework principle, where Government involvement is needed, its aim should be to support and enforce a predictable, minimalistic, consistent, and simple legal BIS Review 26/1998  -2environment for commerce. This legal environment should be based on a commercial law model that allows for private governance though decentralized, contractual relationships or organized system rules, rather than a top-down regulation model.

What remains to be seen is whether the infrastructure needed to create binding electronic contracts between previously unaffiliated parties can be developed to meet the needs of consumers and merchants globally. This leads me to my second topic -- the establishment of a Uniform Commercial Code for Electronic Commerce. Uniform Commercial Code For Electronic Commerce The White House Framework states that, in order “to encourage electronic commerce, the United States Government should support the development of both a domestic and global commercial legal framework that recognizes, facilitates and enforces electronic transactions worldwide.” In keeping with its belief that the private sector should take the lead in electronic commerce issues, the White House is largely relying on the efforts of the National Conference of Commissioners of Uniform State Laws and the American Law Institute, the sponsors of the Uniform Commercial Code, to produce the desired domestic commercial law framework. Internationally, the United States Government is working with organizations such as the United Nations Commission on International Trade Law, the OECD, UNIDROIT and the International Chamber of Commerce to achieve the necessary global commercial law framework. The United States has adopted, and has urged others to adopt, the following drafting principles. First, parties should be free to order the contractual relations between themselves as they see fit. Second, rules should be technology neutral -- in other words, the rules should neither require nor assume a particular technology -- and should be forward looking -- should not hinder the use or development of technologies in the future.