[Weekly Compilation of Presidential Documents Volume 34, Number 49 (Monday, December 7, 1998)]
[Pages 2392-2396]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Joint Statement From Australia and the United States on Electronic 
Commerce

November 30, 1998

    Australia and the United States believe that the growth of the 
information economy is a significant and positive development for both 
countries and, generally, for society and global business. The benefits 
of e-commerce, in particular, include access to new markets, quality of 
service, encouragement of innovation, more efficient management of 
supply and distribution and better customer service. These benefits 
should accelerate economic growth in all sectors, and across all regions 
and communities.

I. Purpose of Statement

    This joint statement is being made in order to accelerate the 
development of e-commerce in both countries and empowerment of 
individual citizens by: providing certainty and building confidence for 
government,

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business and consumers in key areas of e-commerce; facilitating progress 
in key areas, particularly a transparent and consistent legal framework; 
promoting a dialogue between Australia and the US on e-commerce issues 
which will benefit government, business and consumers.

II. Policy Principles

    The growth of electronic commerce will be led by the private sector, 
and its continued development depends on leadership by the private 
sector in key areas both domestically and internationally.
    Competitive market-based solutions to specific issues for the 
information economy will promote optimal growth and benefits. 
Governments should avoid imposing unnecessary regulations. When 
regulation is necessary, they should rely on a ``light touch'' 
regulatory environment. Where the market alone will not solve problems, 
self-regulation gives maximum control and responsibility to the 
individual and should be the preferred approach. In some cases this may 
need to be facilitated by legislation to ensure effective arrangements. 
In light of the global nature of e-commerce, government-based or 
industry-based approaches should be coordinated and harmonized 
domestically and internationally, as far as possible. Government should 
actively pursue excellence in the online delivery of government services 
and in its dealings with business.

III. Policy Issues

    Australia and the United States agree on the following approaches to 
key areas of electronic commerce and the information economy:
    1. Taxes and Tariffs
    Rules for the taxation of the Internet and electronic commerce 
should be neutral, efficient, simple to understand and should promote 
certainty. Governments will cooperate closely to ensure effective and 
fair administration of their tax systems in relation to electronic 
commerce, including prevention of tax evasion and avoidance. In support 
of this the Australian and US national tax authorities should continue 
to consult and cooperate on the taxation issues associated with 
electronic commerce in international fora, such as the OECD and other 
bodies, and at a bilateral level in accordance with the exchange of 
information provisions of the 1982 Australia-US Double Tax Convention.
    Australia and the US support the indefinite extension of the WTO 
declaration of May 1998 not to impose customs duties on electronic 
transmissions.
    2. Developments in International Fora
    A. World Trade Organization (WTO): The international trading system 
under the WTO should foster the growth of electronic commerce by 
reducing the scope for trade-distorting government intervention and to 
give enterprises greater access to the global marketplace. Australia and 
the United States are actively participating in the WTO work program on 
e-commerce, with the shared objective of undertaking a comprehensive 
review of the implications of e-commerce for the application of WTO 
agreements and for mandated negotiations, taking into account the 
application of the established body of trade rules to electronic 
commerce and the importance of further expanding market access and trade 
liberalization commitments within the WTO framework. The program should 
also consider the potential contribution of e-commerce to development 
objectives, and means to promote greater access for enterprises in 
developing countries to the global digital network. The General Council 
should continue to coordinate the work program, avoiding duplication 
with work done elsewhere, focussing on workable outcomes, and keeping 
open the possibility of adding new issues to the work program.
    B. Asia-Pacific Economic Cooperation (APEC): Both governments 
welcome the ongoing e-commerce work program in a range of APEC sub-fora, 
including agreement to the key themes and future work program outlined 
in the APEC Blueprint for Action on Electronic Commerce.
    3. Business and Consumer Confidence
    It is essential that business and consumers have confidence in 
transactions conducted electronically. This will be facilitated by 
action in the following areas:
    A. Electronic Authentication: Governments should work towards a 
global framework that supports, domestically and internationally, the 
recognition and enforcement

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of electronic transactions and electronic authentication methods 
(including electronic signatures). At an international level this should 
include exploring the possibility of a convention or other arrangements 
to achieve a common legal approach that will support electronic 
transactions as well as a variety of authentication technologies and 
implementation models. This approach should:
    a. Remove paper-based obstacles to electronic transactions by 
adopting relevant provisions from the UNCITRAL Model Law on Electronic 
Commerce; b. Permit parties to a transaction to determine the 
appropriate authentication technologies and implementation models for 
their transaction, with assurance that, to the maximum extent possible, 
those technologies and implementation models will be recognized and 
enforced; c. Permit parties to a transaction to have the opportunity to 
prove in court that their authentication technique and their transaction 
is valid; d. Take a non-discriminatory approach to electronic signatures 
and authentication methods from other countries.
    B. Privacy: Ensuring the effective protection of privacy with regard 
to the processing of personal data on global information networks is 
necessary as is the need to continue the free flow of information. With 
regard to frameworks for personal data protection, governments and 
businesses should consider consumers' concern about their personal 
information. Governments should support industry in implementing 
effective privacy protection. Personal information should be collected 
and handled in a fair and reasonable manner consistent with generally 
accepted privacy principles. The OECD Privacy Guidelines provide an 
appropriate basis for policy development.
    C. Critical Infrastructures: Protection of information, as well as 
the information systems and infrastructures themselves, is a key element 
in building user confidence. In some cases information infrastructures 
are critical to public safety and national economic well-being. The 
preferred approach to information security is through industry awareness 
and industry based solutions. The OECD Guidelines for the Security of 
Information Systems should be the basis for national approaches to 
information security. Governments should provide leadership and provide 
advice on threats, vulnerabilities and security responses to ensure that 
critical information infrastructures are protected.
    D. Consumer Protection: Consumers should receive effective 
protection in the online environment which can be promoted through 
enforcement of existing consumer protection laws, modification of these 
laws as necessary to accommodate the unique characteristics of the 
online market, consumer education, and industry supported mechanisms to 
empower consumers, and resolve consumer complaints and concerns.
    4. Content
    The Internet is a medium for promoting, in a positive way, diffusion 
of knowledge, cultural diversity and social interaction, as well as a 
means of facilitating commerce. Governments should not prevent their 
citizens from accessing information simply because it is published 
online in another country. Empowerment of users, including parents in 
relation to material which may be unsuitable for children, should be 
achieved through information and education, as well as through the 
availability of filtering/blocking systems or other tools. Industry 
self-regulation will assist in the promotion of content labeling. 
Industry will need to deal appropriately with complaints about 
prohibited content. We encourage international cooperation between law 
enforcement authorities to prevent, investigate and prosecute illegal 
activities on the Internet and the illegal use of e-commerce by criminal 
and terrorist organizations.
    5. Government Services and Information
    Good administration is promoted by governments ensuring that they 
pursue excellence in delivery of government services and information 
online in a citizen-friendly way rather than reflecting bureaucratic 
structures. Governments can also contribute to the development of the 
information economy by acting as role models and market catalysts. 
Business and user confidence will be enhanced by effective government 
use of electronic payments systems.
    Government led developments in public key and other authentication 
technologies should be encouraged to facilitate trade

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through the use of secure electronic exchange of permits and licenses.
    Both countries recognize the value of, and will continue to support, 
international cooperation in electronic delivery of government services 
through bodies such as the International Council for Information 
Technology in Government Administration, and through collaborative work 
such as the G7 Government Online Project.
    Governments consider the remediation of the Year 2000 computer date 
problem as a matter of critical importance to both countries and 
international communities. The exchange of appropriate information and 
expertise would provide significant assistance in addressing this issue.
    6. Domain Name System (DNS)
    Both countries agree on the following guiding principles:
    Stability: The US Government should end its role in the Internet 
name and numbering system in a manner that ensures the stability of the 
Internet. The introduction of a new management system should not disrupt 
current operations or create competing root systems. During the 
transition and thereafter, the stability of the Internet should be the 
first priority of any DNS management system. Security and reliability of 
the DNS are important aspects of stability, and as a new DNS management 
system is introduced, a comprehensive security strategy should be 
developed with input from the private sector.
    Competition: The Internet succeeds in great measure because it is a 
decentralized system that encourages innovation and maximizes individual 
freedom. Where possible, market mechanisms that support competition and 
consumer choice should drive the management of the Internet because they 
will lower costs, promote innovation, encourage diversity, and enhance 
user choice and satisfaction.
    Coordination: Certain management functions require coordination. In 
these cases, responsible industry self-regulation is preferable to 
government control and is likely to be more flexible and responsive to 
the changing needs of the Internet and of Internet users. The self-
regulatory process should, as far as possible, reflect the bottom-up 
governance that has characterized development of the Internet in this 
area to date.
    Representation: Private sector mechanisms should be developed to 
ensure that domain name system management is responsive to Internet 
stakeholders worldwide.
    7. Intellectual Property Rights
    Adequate protection of intellectual property rights on a technology-
neutral basis is essential for the development of e-commerce. The new 
WIPO Copyright Treaty and the Performances and Phonograms Treaty provide 
a sound basis in this regard. Further consideration of implementation of 
the measures in the treaties will be a positive step.
    8. Infrastructure
    The supporting infrastructure for online transactions must be 
technically and commercially suitable, particularly in terms of adequate 
bandwidth and competitive pricing. The optimal outcome will be achieved 
through competitive provision of infrastructure and telecommunication 
services within a pro-competitive regulatory framework.

IV. Work Program

    Recognizing that bilateral cooperation can complement the 
development of essential multilateral frameworks, Australia and the 
United States will:
    Work with the private sector and consumer groups in both countries 
to promote dialogue and cooperation on the issues contained in this 
statement, and facilitate the translation of such dialogue and 
cooperation into meaningful international frameworks.
    Cooperate closely in relevant international fora to support the 
growth of and access to global e-commerce; these may include, for 
example, the WTO, WIPO, OECD, UNCITRAL, UNCTAD, and APEC.
    Actively promote exchange of information and views at government 
level on all relevant e-commerce issues. This could include economic and 
trade issues such as how e-commerce affects small and medium sized 
enterprises, including their ability to develop markets and generate 
employment; and the broader economic and social impacts of e-commerce.

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    Work to ensure that the benefits of such exchanges are shared more 
broadly, particularly in the Asia Pacific region.

Note: An original was not available for verification of the content of 
this joint statement.