STATE HOUSE - Legislation designed to facilitate and promote secure electronic commerce by defining and by giving legal standing in Rhode Island to such terms as electronic record and electronic signature has been approved unanimously by the Rhode Island House of Representatives.
Called "The Rhode Island Electronic Commerce Security Act", the legislation adds a new Chapter 47 to the "Commercial Law - General Regulatory Provisions" section of the Rhode Island General Laws. It was introduced by Rep. Eileen S. Naughton (D-Dist. 32) of Warwick.
"Electronic commerce (e-commerce) is the new world economy and it is definitely booming," said Representative Naughton. "This legislation will begin to establish in Rhode Island the legal infrastructure for conducting business electronically in the most secure manner, especially on the internet. Electronic commerce is one of the most exciting business opportunities in the history of civilization, but it is uncharted territory."
The Warwick legislator said that by 2001, the total U.S. internet economy is projected to be over $350 billion with the business-to-business sector accounting for $186 billion of that total. She said that consumer retail activity on the internet is growing slower, yet is still expected to total $18.4 billion by 2001.
"However, there is still a lot of uncertainty about the reliability of such things as electronic records and electronic signatures," said Representative Naughton. "You also have the problem of forged electronic records and the intentional or unintentional alteration of these records and signatures."
The Naughton legislation ('99-H 5420 Substitute A, As Amended) consists of two sections. The first part includes a number of definitions, including such terms as "electronic record" and "secure electronic signature". The second part - "Purpose. Rules of construction" - establishes the legality of such terms. For example, one rule says that: "When a rule of law requires a signature, an electronic signature satisfies that rule of law."
Representative Naughton said that her legislation, which must now be approved by the Senate, is a first step to building a complete legal foundation in Rhode Island for electronic commerce. "If e-commerce is to achieve the success everyone is predicting, we must build and promote public confidence in the integrity and reliability of electronic records and electronic commerce," she said.
