In Cambodia, where cash remains king, buying goods over the Internet with credit or debit cards has existed on only a very limited scale to date.
E-commerce in the Kingdom has remained hampered by unfamiliar and fearful consumers and a lack of secure processing options.
On top of these limitations, however, “there has been no regulatory framework for the existence of e-commerce transactions whatsoever,” says Matthew Rendall, Board Member of BritCham Cambodia and Senior Partner at Soksiphana & Associates/Zicolaw.
As the law stands currently, a buyer or seller couldn’t legally use Ebay from Cambodia, for example, because Cambodia lacks the necessary Internet transaction law.
Given this state of the law, all internet based contracts may well have been legally void for years.
This applies to both domestic and international internet-based contracts.
While most assume e-commerce relates merely to online shopping, it likewise covers any type of business or commercial transaction involving the transfer of information over an electronic medium.
This would include internet-based trading of goods and services between corporations and other commercial entities, electronic data exchange and online banking, explains Rendall.
The process to create such a law in Cambodia began in 1999 with the launching of the e-Asean Initiative, a regional strategy seeking a harmonious e-commerce legal framework across all jurisdictions of ASEAN.
Cambodia, however, has remained the only ASEAN member state yet to pass the planned e-commerce regulation.
Nevertheless, “it’s on its way,” confirms Rendall.
The draft law on e-commerce set to regulate electronic trade in Cambodia first arrived before the Council of Ministers in August 2014, the World Bank having provided $120,000 to draft the e-commerce law.
Following this introduction, the draft is awaiting final input from the Ministry of Post and Telecommunication and the National Bank of Cambodia.
The law will be come into force later this year.
The Cambodian E-commerce Law will include detailed regulation for online contracts and online signatures, in line with international standards.
The new law, says Rendall, seeks to bolster trading activities via electronic networks in local and international markets.
Among other things, the law will help banks and ministries quickly access business information and registration, and generally speed up business transactions of all kinds.
Under the new law, Cambodian companies can create legitimate online businesses and create legitimate contracts online, such as online shopping sites and the processing of online bank transfers. If contracts are broken or breached, the e-commerce law will provide recourse.
Cambodian businesses will be able to legitimately conduct e-commerce internationally, creating vast new potential for international market expansion for Cambodia-based importers and exporters.
“The new e-commerce law will unleash full scale e-commerce in Cambodia,” concludes Rendall.