Creating the Legal Framework for Information and Communications Technology Development: The Example of E-Signature Legislation in Emerging Market Economies

This article examines the role of e-signature laws in creating the legal frame-work for e-commerce in developing and transitional countries. It argues that an early focus on electronic signature laws can be a distraction from more important reforms necessary to support e-commerce and information and communications technology development (notably telecommunications liberal-ization, support for entrepreneurship, transparency, banking reform). The article outlines an incremental legal reform strategy for emerging economies to address the issues surrounding electronic documents and e-signatures, and it recommends as an initial step legal reform that recognizes contracts entered into by businesses that have agreed by traditional means to technical standards for electronic contracts. For e-government applications, this article suggests steps governments may take to experiment with authentication systems (including possibly digital signatures). It recommends that govern-ments hesitate before setting up regulatory systems to license technologies or service providers for e-commerce. Furthermore, it identifies broader lessons for those interested in legal reforms to support growth of the Internet as a component of development, stressing the importance of basing legal reform efforts on a sensitive analysis of local needs and actual business practices. (c) 2004 Massachusetts Institute of Technology Information Technologies and International Development.