June 9, 1997 7:05 PM PDT

E-commerce policy ready July 1

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Who should collect taxes in cyberspace? Do children need special protections in electronic transactions? On July 1, The White House will formally unveil a policy framework for considering these and other explosive questions about the Information Age.

"A Framework for Global Electronic Commerce," as the paper is known, urges governments to resist passing new laws governing the Internet and electronic commerce. Instead, the paper urges using contract law to govern electronic sales and advocates exempting Internet sales from new taxes. It concedes that only the most basic legislation for protecting privacy, especially for children, should be enacted.

The policy was written under the direction of senior White House adviser Ira Magaziner. It may come as a surprise to those who know the long-time friend to President Clinton only as the co-chair of the White House's health care reform package. The antigovernment, antilegislation stance of the policy stands in contrast to the legislation-dependent healthcare reform package the economist helped construct during Clinton's first term in office.

So far, the policy--which is in its tenth draft and has been available on the Internet for public viewing and comments--has received cautious praise from the computer and information industries. But if business is happy with the policy, consumers may not be quite as thrilled.

The Consumer Union and other consumer groups are fighting a so-far losing battle to include consumer protections in proposed changes to the Uniform Commercial Code. The UCC is the set of laws by which the Administration advocates governing all Net sales. Consumer advocates say they fear the UCC, which was created to govern business-to-business transactions, leaves individuals making Net purchases at the mercy of powerful companies.

The final draft of the policy is also expected to help shed some light on the administration's policy on intellectual property. The Patents and Trademarks Office, under Bruce Lehman, has advocated strong new laws and international treaties that protect powerful interests, such as credit reporting agencies, media companies, software companies, and entertainment giants, some say at the expense of the rest of society.

Libraries, consumer groups, and research scientists have all heavily criticized the proposed laws, saying they will cut off the flow of information vital to a free and democratic society. This pressure has led the Administration to pull back on some of its more visible efforts to pass such laws. However, the White House, which says it is reconsidering its stance, has remained quietly supportive of the ideas embodied in these laws.

Both Clinton and Vice President Al Gore are expected to take part in the formal release of the long-awaited paper. But that doesn't mean all the talk is over.

As one White House policy analyst familiar with the draft said, "There are still plenty of monkey wrenches in there."

 

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