Select Committee on European Union Written Evidence

Memorandum by TrustMarque International Ltd


TrustMarque is a specialist Application Service Provider enabling total management of Internet transactions—information, digital or payment commerce—from purchase to fulfilment.

  The company develops intelligent e-commerce back office systems and platforms, and a portfolio of trusted Internet transaction applications in a secure e-commerce environment, the TrustCenter. The TrustCenter delivers a secure, multi-currency, e-commerce trading platform, available as a fully-managed outsourced service or as a franchise. A number of secure applications are available including payment and order processing, fraud screening, intellectual property rights distribution and auditing, and document delivery and certification.

  The TrustCenters support the many individual requirements of today's e-businesses such as ISPs,e-merchants, corporate organisations and publishers. These organisations use TrustMarque's low risk solutions to enable secure and trusted e-commerce. TrustMarque's head office is based in Gerrards Cross. In addition to this facility the company has TrustCenters in Singapore and Canada.

  TrustMarque's clients include big names such as Intel, Lotus, Network Associates, Symantec, Freeserve, Tesco, Ziff-Davis and Associated News Media.

1.  What needs to be done to create confidence and to stimulate e-commerce in Europe?

  An e-commerce infrastructure which is transparent and trusted by business supported by Government and leading "trustworthy" brands in the UK is needed to facilitate e-commerce. This can be achieved by technologies like digital certificates carried on smart cards or other tokens; business procedures and methodologies; and training and educating.

  There are a number of common consumer complaint issues which currently characterise the UK/European e-commerce market place. For example,

    —  Companies failing to deliver goods that have been ordered.

    —  The lack of adequate means by which consumers can interact and communicate with an Internet merchant (this could be solved with the use of a "call me" button on a website which connects the consumer with a "real" person).

    —  Lack of robust complaint procedures that are effective and have "teeth".

    —  Lack of league tables of e-retailer site performance published in annual reports and on an e-tailers website

    —  Lack of independent audits of the trust procedures incorporated by an e-tailer/Internet merchant.

  Additionally, credit card logos do not invoke trust at all. What are needed are others "trust-giving logos" that can be applied to websites, backed by recognised and trusted organisations and substantial advertising and education campaigns. Training and education programmes are key.

  A fundamental impediment to the success of e-commerce in the UK is cost. Whereas in the USA, the Internet is free, in the UK it is charged as a local telephone call. Likewise, the high rates of VAT charged on many products purchased and distributed digitally acts as a disincentive for companies to base themselves in the UK because costs are lower elsewhere.

  For Britain to compete it needs to remove these costs and that means the abolition of VAT on all e-commerce transaction.

  With this one move the Government has the opportunity to send a signal around the globe that it wants to be the centre of the e-commerce world. Companies which might be planning to locate in the USA or Asia-Pacific will be forced to think twice when they realise the UK is serious about creating an e-commerce infrastructure which is the best in the world.

  The competition is intense and already there are places like Singapore 1 and the Malaysian Super Corridor that are more readily associated with e-commerce. What the UK needs is an equivalent area which has a reputation known throughout the world as a centre of e-commerce—or as I would like it to be called, a "Digital City".

  The Digital City would have the necessary infrastructure for e-commerce to operate. Tax incentives, and the provision of training to equip people with the necessary skills, would attract companies from around the world to locate there and create a centre of excellence in the UK.

  In essence, the idea is little more than an extension of the Enterprise Zone concept of the 1980s, except instead of a number of Enterprise Zones there would be only one Digital City.

  In the same way that Enterprise Zones were successful in attracting inward investment, the Digital City would do the same for e-commerce. And like the benefits reaped from inward investment, the benefits from attracting a new generation of technology companies will be immense—and at a far cheaper rate than some of the sums used to lure big investors in the early 90s.

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

  The Government has to be seen to be promoting standards and I would see the mechanism for this as being through a combination of self-regulation and law. The annual company returns would be a key mechanism where specific standards of trust, dealing with consumer complaints for example, should be addressed. Companies are not required to focus on this area at the moment.

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

  New ones have to be introduced to provide a central focal point for all e-commerce issues. From there, they could be directed to the appropriate department.

  In the UK, why can't I go to one place and find out all I need to know to undertake e-commerce in the country, from finance and connectivity to training, implementation and grants? Likewise, where can I go to find out what options there are to implement trust in my company, and how I can leverage e-commerce currently? It tends to be the banks etc.

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

  By having dedicated organisation and easily accessible infrastructure—"The Department ofe-Commerce". By providing universal and easy-to-remember log-ons and IDs so that one ID can be used to access different sites. Why not a universal and unique ID for everyone for everything—as per EasyID. With a TrustMarque EasyID, anyone can go to multiple sites like utilities and pay their bills online, just by providing an EasyID.

  By Government moving faster in their thinking and implementation. It currently takes too long to find the right people and for them to move at Internet speed. If other governments such as Singapore and Hong Kong can do it, why can't we?

27 April 2000

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