Missing the boat?

Caveat emptor has gained a whole new meaning for consumers who let their fingers do the shopping through online retailers and services like eBay.

And, says John Davis, there’s a challenge for government in it.

Internet shopping calls for more savvy than a stroll through the aisles of retail stores or a tour of brand name catalogs, explains Davis, president of Ottawa-based Partnering and Procurement and a long-term observer of technology trends in government.

It requires consumers “to become aware of their own interests,” he said in an interview. “It’s an environment where a lot of the ground rules are changing.”

Governments, Davis adds, are finding that having the world as a marketplace for their citizens has created new challenges for their traditional consumer protection role. Measured against online shopping, “its traditional views on consumer protection are woefully inadequate.”

Davis says governments need to rethink what consumer protection activities they can still do on their own as well as how they should co-operate with other jurisdictions to protect shoppers from fraudulent activities. The federal government should be looking at what steps the United States, the European Union and other industrialized economies are taking to police Internet vendors.

One step governments should be able to take is using the Internet to exchange consumer protection information and advice, Davis said. They also have to ensure that their policies can evolve with changes to information technology.

Younger generations, with their greater familiarity with the Internet, are more at ease with online shopping, Davis points out. They know how to use online reference sites to compare products and evaluate suppliers, and will report bad experiences to Web sites that keep track of rip-off and scam artists. Internet shoppers have to be alert to protect against identity theft or fraud by a retailer beyond the reach of their governments.

In response to e-mailed questions about Davis’s comments, consumer protection officials at Industry Canada said a number of steps have been taken to protect shoppers and the issue will be a high priority item for years.

One step is “the development of the Canadian Code of Practice for Consumer Protection in Electronic Commerce, which establishes benchmarks for good business practice for merchants conducting commercial activities with consumers online (see www.CMCweb.ca). The Code is also consistent with the Organization for Economic Co-operation and Development’s Guidelines for Consumer Protection in the Context of Electronic Commerce.”

The code was developed by representatives of business and consumer organizations and government and released in January 2003 after extensive consultations, the response said. It underwent pilot testing by a number of private sector participants that spring. “The Code was then reviewed and finalized with input from the E-Commerce Leaders Code Review Committee and endorsed by federal and provincial ministers responsible for consumers affairs in 2004.

“The Code will be reviewed regularly to ensure its relevance to current technology and business practices and its effectiveness in promoting consumer protection in electronic commerce,” the department said. In the meantime, it is discussing the code with organizations that could implement it.

Elsewhere, the recently launched Interac Online initiative requires participating merchants to comply with the Code. The Canadian Council of Better Business Bureaus’ On-Line Reliability Seal program also is requiring acceptance of the Code, the department said.

As for the international aspect of online shopping, the department said organizations like the OECD will play an important role. “Initiatives such as the OECD Spam Task Force now underway and the work of the OECD Committee on Consumer Policy which has developed international guidelines for both consumer protection in e-commerce and Guidelines for Protecting Consumers from Fraudulent and Deceptive Commercial Practices Across Borders are examples of this work.”

Fighting spam has become a Canadian priority and a special task force has presented Industry Minister David Emerson with a report that outlines a number of issues that affect online consumer trust and confidence, the department added. The report can be found at http://strategis.ic.gc.ca/epic/internet/inecic-ceac.nsf/en/h_gv00317e.html. Tips for consumers can be found at www.stopspamhere.ca.

Consumer officials co-operate with the Competition Bureau on a number of initiatives, ranging from Fraud Prevention Month held in February to cross-border fraud and identity theft initiatives. “These are all important elements that will ultimately lead to better protection of consumers in the online environment. Furthermore, the Competition Bureau has entered into a number of international agreements.”

Alex Binkley ([email protected]) is a freelance journalist based in Ottawa.

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