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World: Expert Sees Electronic Commerce Enhancing Liberty, Democracy

An expert on the Internet contends that its users are now organizing electronic communities that will, among other things, offer the same economic services traditionally offered by nations. He explains his views in an interview with our correspondent, Julie Moffett.

Washington, 16 March 2001 (RFE/RL) -- An expert on the Internet says people who use the international computer-based network are rapidly developing into electronic communities that will soon offer the same economic services traditionally provided by nations.

Mark Grady, the Dean of George Mason University's School of Law, says the evolution of Internet structures to facilitate commercial and business transactions was one of the main topics of conversation at last week's Global Internet Summit, held at the university's campus near Washington.

Grady told RFE/RL that representatives from 57 countries, including Russia, attended the summit. Participants discussed the laws and regulations currently governing the thriving business of electronic commerce, also called e-commerce.

He cited examples of several online business communities where people are given membership if they meet certain qualifications of the owners of the sites. Once admitted to these sites, they can conduct business and engage in e-commerce.

However, Grady says they can remain members in good standing only if they obey those rules. People who do not abide by the website regulations can be ostracized or pushed off the site by the owners.

"The remarkable thing about this regulation is that it does not depend on national sovereignty. It doesn't depend on court enforcement or the rules of any one country. But that system or framework can exist around the world so that people from all different countries can do business on that particular site without having to worry about the different laws and different jurisdictions."

Grady says commerce on the Internet provides tremendous opportunities to developing countries such as those of the former Soviet Union and Eastern Europe. He says nations in transition to market economies can use the Internet in the same way they now use mobile telephones.

For example, he says that with the growth of mobile telephone usage, many of the former communist countries have not found it necessary to develop landline communications, but have simply jumped to the use of mobile telephone, satellite, and digital communications.

"Perhaps it is not necessary for the countries of the former Soviet Union to develop elaborate commercial codes. They could simply rely upon the new structure being developed on the Internet and become full participants in the global economy through the guarantees and authentications that exist through these new Internet sites that are providing for laws in the same way that countries provide for legal regulation."

Grady says the Internet revolution is transforming the way the world conducts business. He adds that it has also provided "tremendous possibilities for enhancing liberty and democracy" in all countries, especially those of the former USSR and Eastern Europe.

According to Grady, because the Internet does not respect borders or national sovereignty, it provides a free flow of information that is "the enemy of despotism."

"One way that people resist despotism is by exchanging information and organizing. Certainly the Internet facilitates all of that. But beyond that, I think the Internet also can help liberty in a more striking way. In a nation-state, people can be prevented from exiting that nation-state and the rulers of that nation can appropriate them simply because they cannot leave -- in other words, tax them excessively or otherwise find ways of converting the national good to their own uses."

But what about those countries in the former USSR, especially those in Central Asia, where Internet access is sharply controlled by the government? Can the Internet promote democracy and liberty among the general masses if the people are unable to access the network?

Gerald Kovacich, a U.S. Internet security expert, told RFE/RL that it is technically impossible to completely control access to the Internet. He says it is relatively easy to gain access to the Internet, even without proper authorization. He adds that one doesn't even require a computer any more since such items as today's mobile phones, faxes, and hand-held devices can easily interface with the Internet and can utilize satellite and wireless technology.

Kovacich says that while these items might currently be in short supply in poorer countries, they will become more in demand among those people and organizations rallying against the government.

For the government to completely regulate Internet access, Kovacich says it means officials would have to stop, monitor, and control all information-carrying devices indefinitely. He says that is not a likely nor plausible scenario.

Grady says that with the Internet, people can organize their own communities independent of the restrictions of national sovereignty. These communities then can compete with each other and continue to offer more incentives and better service to keep their communities attractive and active.

Grady says there is little inherent danger the owners of these cyber communities will try to appropriate or oppress their customers because those customers are free at any time to move to other sites that offer exactly the same services.

"I think we are moving into an era in which cyber communities or communities that are organized on the Internet will provide the same services that are traditionally provided by nation-states. And nation-states will actually fall into competition with these sites and cyber-communities."

Competition will fuel e-commerce, says Grady, and in turn, a thriving economy will enhance liberty. As a result, he says it is not necessary for countries that do not already have highly intricate systems of business regulation and corporate law to build ones. Instead, he says, they may now be able to rely upon the new global rules that are arising on the Internet.