Select Committee on European Union Written Evidence

Memorandum by Informix Software Ltd


Headquartered in California, Informix is recognised as the technology leader in software infrastructure for the Internet. Informix is the first and only company to integrate e-commerce and business intelligence on a true Internet infrastructure. It provides a complete, fast and simple way to bring businesses to the Web, personalise content management, and analyse informaiton real-time.

Q:What needs to be done to create confidence and to stimulate e-commerce in Europe?

  There are many factors which affect business and consumer confidence in e-commerce. They include, for consumers:

    —  Quality of services

    —  Performance of services

    —  Access to services

    —  Cost of services

    —  Breadth of choice of services

    —  Ease of implementation of services

    —  Regulatory obstacles to provision of services

    —  Financial incentives for provision of services

    —  Access to a trusted knowledge base

  The European Commission, the UK Government and industry have the power to influence many of these factors to improve business and consumer confidence in e-commerce. The UK Government is taking significant steps to provide the right environment for business and to build consumer confidence, for example:

    —  Universal Internet access no later than 2005

    —  All Government services online by 2005

    —  Cuts in Capital Gains Tax

    —  Reduction in audit requirements for small businesses

    —  Ability to file tax returns online

    —  Connecting schools and libraries through the National Grid for Learning

  The European Commission recently set a clear strategic goal for the European Union to be the most competitive and dynamic knowledge-based economy, and recognised that small firms will be the main engines for job creation and economic growth in Europe.

  However, it is not all good news:

    —  The regulatory environments vary across Europe, including taxation and privacy laws. Where possible, these need to be brought into line.

    —  The setting of the 2005 date, brought forward from 2008, is clearly politically motivated. It will not be achievable without significant financial investment by the Government, together with a commitment to fundamentally alter the structure of many government agencies and departments.

  If the Government fails to demonstrate real commitment to move forward, showing progress towards the 2005 objectives, then business and consumer confidence will suffer.

Q:Will codes of conduct and co-regulation provide sufficient protection? Is there a case for intervention by national governments and the EU?

  The Internet is an open platform, and this openness has been one of the drivers for its widespread adoption. There is extensive legislation in place to protect the consumer (eg data protection act, trading standards, etc.) and e-business should be no different in this respect.

  Intervention by national governments and the EU should be kept to a minimum—it should only be required where new technologies create situations not adequately covered by existing legislation. Examples of this are: The acceptability of electronic signatures, covered by the Electronic Communications Bill. Regulation of police monitoring activities that covers electronic communications, addressed by the controversial Regulation of Investigatory Powers (RIP) Bill.

  The RIP Bill is an example where it is vitally important to get it right—in its current form it may drive people and business out of the UK. This is because it appears to place the burden of proving innocence on the accused.

Q:  Should existing EU institutions' internal structures be changed, or new ones created, to improve policy development and co-ordination?

  Historically, EU policy development has been too slow and bureaucratic. However, the UK must not operate in isolation, so the EU institutions need to embrace all member countries' views but in a manner that does not stifle innovation in policy development and implementation. This will most likely require changes in the way these bodies are set up, their criteria for success and their accountability, so that they can be more dynamic and forward thinking.

Q:  How can structural change be brought about fast enough to accommodate the growth of e-commerce?

  Government policy is critical to the successful implementation of structural change, in technology infrastructure, social awareness and cultural behaviour. All aspects need to be addressed, but perhaps the most pressing is the need for greater support for the development of the information infrastructure in the UK, to enable the pace of adoption of Internet services to be accelerated.

  This covers areas such as:

    —  Accelerated deployment of high bandwidth telecommunications services such as ADSL.

    —  Increased competition in fixed line telecommunications services to reduce costs.

    —  The means by which new communications capabilities are introduced, to avoid the problem that private sector bids for access to these capabilities don't inadvertently tax future usage of the service, as is happening at the moment with the third generation mobile licence auction.

  Another area the Government can address is the encouragement of an entrepreneurial culture within the UK to speed up the creation of innovative new businesses.

  There are several ways in which this can be achieved. Removal of unnecessary red-tape for small businesses. Encouraging businesses to utilise the information infrastructure to locate themselves and their employees in more diverse locations, rather than predominantly in the south-east. Tax or other financial incentives for businesses adopting new communications technologies. Provision of wide ranging information services to help fledgling organisations find the information they require to get started and begin trading across Europe and world-wide.

  The final area is that of personal development, where a focus is needed both on developing the right skills through our education system, and on re-training our existing people in order to better meet the requirements of the new economy. The Government can be the catalyst for moving the skills base forward by:

    —  Providing the infrastructure for delivering training;

    —  Encouraging re-training; and

    —  Facilitating access to training services.

19 April 2000

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