Ecommerce development in Hong Kong

1
E-commerce development in Hong Kong

International Council of Electronic Commerce
Consultants Seminar on Embracing the E-Commerce
Development

• Sin Chung Kai Legislative Councillor (IT)
• 30 August 2007

2
Content

• Why does Hong Kong need to enhance
  e-commerce adoption?
• Obstacles?
• What has our government done?
• Way forward

3
How often do you use e-commerce?
B2B
C2C
B2C
B2G
G2C
4
Increasing trend in e-commerce adoption in
business
Source Science and Technology Statistics
Sections, Census and Statistics Department, HKSAR
5
Increasing business receipts via electric means
Source Science and Technology Statistics
Sections, Census and Statistics Department, HKSAR
6
Increasing trend in using online purchasing
services
Source Social Survey Sections, Census and
Statistics Department, HKSAR
7
Increasing trend in use of IT in business
PC usage (in )
Internet usage (in )
Source Report on 2001, 2002, 2003, 2004, 2005
2006 Annual Survey on Information Technology
Usage and Penetration in the Business Sector,
Census and Statistics Department, HKSAR
8
Increasing trend in IT adoption in business
Website usage (in )
Revenue generated via e-commerce
Source Report on 2001, 2002, 2003, 2004, 2005
2006 Annual Survey on Information Technology
Usage and Penetration in the Business Sector,
Census and Statistics Department, HKSAR
9
Key Statistics in Hong Kong (May 2007)
Source OCGIO
10
E-readiness rankings 2007
Source The 2007 e-readiness rankings Raising the
bar, Economist Intelligence Unit
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In Asia-Pacific Region
Source The 2007 e-readiness rankings Raising the
bar, Economist Intelligence Unit
12
Networked Readiness Index 2006-2007

• Measure the degree of preparation of a nation or
  community
• ? to participate in and benefit from ICT
  developments

Source Global Information Technology Report
2006-2007, World Economic Forum
13
High Broadband penetration rate
3rd Highest in the World!
Source ITU Internet Report 2006 digital.life,
(Dec 2006) , International Telecommunication
Union, (data as at 31 Dec 05)
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Digital Access Index

• Measures the overall ability of individuals in an
  economy to access and use ICT
• 4 main indicators
• Affordability
• Internet access price
• Knowledge
• School enrollment
• Literacy
• Quality
• International internet bandwidth
• Actual usage of ICTs
• Mobile cellular subscribers

Source ITU
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Content

• Why does Hong Kong need to enhance
  e-commerce adoption?
• Obstacles?
• What has our government done?
• Way forward

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Technology Crime Statistics in HK (02 -06)
Others include traditional offences such as
criminal intimidation, using a false instrument
etc.
Source http//www.police.gov.hk/hkp-home/english/
tcd/overview.htm
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Technology Crime

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• ???????????????,?????????????????,?????????????
• ????????????,???????????????????,?????????
• ??WiFi????????,????????,????????????

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Content

• Why does Hong Kong need to enhance
  e-commerce adoption?
• Obstacles?
• What has our government done?
• Way forward

19
What has our government done?

• Electronic Transactions Ordinance (ETO)
• Unsolicited Electronic Messages Ordinance and
  Evidence Ordinance (Section 22A)
• Electronic Service Delivery (ESD)
• Public Certification Authority and e-Cert
• Centre for E-Commerce Infrastructure Development
• Collaboration with the industry
• Sector-specific Programme

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What has our government done?

• Electronic Transactions Ordinance (ETO)
• Enacted on 5 January 2000
• Modelled on the UN Commission on International
  Trade Law Model Law on Electronic Commerce
• Aims
• Provides a clear legal framework for conducting
  e-transactions
• Enhances public confidence in adopting
  e-transactions
• Major content
• Enables e-records and digital signatures to enjoy
  the same legal status as their paper base
  counterparts
• Establishes a voluntary recognition scheme for
  Certification Authorities (CAs)

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Electronic Transactions Ordinance (ETO)

• Writing (Section 5)
• Information can be given by means of an
  electronic communication
• Signature (Section 6)
• Digital signature of the person is acceptable if
  it is supported by a recognized certificate and
  is generated within the validity of that
  certificate
• Original form (Section 7) Electronic records
  (Section 8)
• Information can be presented or retained in
  e-form
• Contracts (Section 17)
• Context of the formation of contracts, may be in
  whole or in part expressed by means of electronic
  records
• Contracts shall not be denied validity or
  enforceability solely because of the contract is
  in e-form

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Voluntary Recognition Scheme for Certification
Authorities (CAs)

• Government Chief Information Officer (GCIO)
• Grants recognition to CAs
• Publishes Code of Practice for CAs
• Maintains on-line and publicly accessible record
  of each CA
• Currently, 3 CAs
• The Postmaster General
• Recognized in ETO, Section 34
• Personal / organizational / server e-cert,
  Bank-cert, Mobile-cert
• Two private CAs
• Digi-Sign Certification Services Limited
• Cert required for electronic submission of
  trade-related documents
• HiTRUST.COM (HK) Incorporated Limited
• Server cert

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Electronic Transactions (Amendment) Ordinance 2004

• ETO was revised on 30 June 2004
• Aims
• Facilitates e-transactions not involving
  government bodies
• Removes unnecessary legal impediments for
  encouraging e-services and e-business
• Streamlines and improve the operation of
  voluntary recognition scheme of CAs

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Major amendment
Note Review on ETO will be conducted this year!
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What has our government done?

• ALLOW
• person-to-person telemarketing calls
• survey or religious messages (not in business
  uses)
• messages sent in response to the recipients
  requests
• messages to confirm a commercial transaction
  that the recipient has previously agreed

• PROHIBIT
• a pre-recorded voice message (in business
  nature) sent to a HK mobile number
• a fax advertisement sent to a company in Hong
  Kong
• an email (for offering any products or services
  )sent to an email address which the registered
  user is in HK

• Unsolicited Electronic Messages Ordinance
• Enacted in May 2007
• to strike the right balance between respecting
  the rights of recipients and allowing the
  development of legitimate e-marketing
• Evidence Ordinance (Section 22A)
• making documentary evidence from computer records
  acceptable in criminal proceedings

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What has our government done?

• Electronic Service Delivery (ESD)
• Enable society to use public services via the
  Internet
• Provide infrastructure for private companies to
  conduct e-commerce
• Promote and educate the public
• Public Certification Authority
• the Hongkong Post (HKPCA)
• launched in January 2000
• Provide electronic certificates (e-Cert)
• Ensure security
• Boost business and consumer's
• confidence

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e-Cert

• Hongkong Post e-Cert for Smart ID Card
• Hongkong Post e-Cert (4 types)
• Personal
• Organisational
• Encipherment
• Server
• Hongkong Post Bank-Cert (3 types)
• Bank of East Asia-Corporate
• Shanghai Commercial Bank
• Personal
• Corporate

Source HongKong Post
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What is e-Cert for?
Online Government Services
Online Banking Services
Electronic Services
ESDSLs contract with the Government will be
expired by January 2008 All e-government services
can be accessed through the GovHK website
Online Stock Trading and Custodian Services
Online Entertainment Services
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Low usage rate for the past 7 years
1.55 million personal organisational
e-Certs
1.26 million free personal e-Certs embedded in
smart ID cards

• E-Mice Solutions (HK) Limited
• Become the operator of Hong Kong post e-Cert
  services from April 1 2007 for 4 years
• Responsible for the full operating cost in
  providing the e-Cert services
• To receive subscription and renewal fees from
  e-Cert subscribers

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Launch of the e-Cert File Card by E-mice

• The latest chip card technology development
• A smart card embedded with an e-Cert
• Alternative and a more reliable e-Cert storage
  medium
• Smaller size
• Less affected by fluctuations in humidity and
  temperature
• Encourage the increasing adoption of e-Cert

Source HongKong Post
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What has our government done?

• Centre for E-Commerce Infrastructure Development
• Computer Science Department, The University of
  Hong Kong
• Work with HKSAR government
• Research and Development project
• Project Phoenix
• Project Plumber
• Project Pyxis
• Project Spinner
• "Extending Web 2.0 to Deliver E-Commerce
  Services

Funded by Innovation and Technology Commission
Funded by Innovation and Technology Fund
Website http//www.cecid.hku.hk/researchndevelopm
ent.php
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Collaboration with the industry

• To promote a wider adoption of e-commerce
• A policy booklet published by my office and HKITF
  in 2003
• Strategies and initiatives recommended were
  adopted by the Administration

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Collaboration with the industry

• Sector-specific Programme (SSP)
• To help industries adopt IT in their business
• By providing training, seminars and roadshows
• will expand the SSP to cover more traditional
  sectors

2004
2005
2006
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Collaboration with the industry

• IT Self-Assessment Ware for Hong Kong SME
• http//www.hkiol.org/itassessment/
• The Information Technology Services Department
  and the Hong Kong Productivity Council
• Provides self-assessment tool for SMEs
• to compare IT adoption level in the respective
  industry
• Provides practical recommendations and useful
  information

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Collaboration with the industry

• Hong Kong Trade Development Council (HKTDC)
• Updates SMEs with the latest business
  information, E-Commerce services,
  technologies and trends
• Provides opportunities to local industries to
  meet Overseas and China companies
• gt 12,000 Hong Kong companies
• promote their products and services via the
  online product catalog
• Vocational Training Council (VTC)
• Provides The New Technology Training Scheme to
  the staff
• Like website design and development, local and
  wide area network implementation etc

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Collaboration with the industry

• Support and Consultation Centre for SMEs
  (SUCCESS)
• Run by the Trade and Industry Department
• Provides SMEs with useful business related
  information
• Like services and facilities offered by various
  government departments and major industry support
  organisations
• GS1 Hong Kong
• Provides professional support
• About global electronic identification of goods
  and services
• Supply chain communication
• Encourages all sectors to adopt E-Commerce
  technologies

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Content

• Why does Hong Kong need to enhance
  e-commerce adoption?
• Obstacles?
• What has our government done?
• Way forward

38
Way forward

• Marco trend in Mobile-commerce
• 2.5/3G mobile services accelerate the growth of
  m-commerce
• 10 of e-commerce
• Asia-Pacific m-commerce, excluding Japan
  (International Data Corp)
• Short Message Service (SMS), Enhanced Message
  Service (EMS) and Multi-media Message Service
  (MMS)
• increasingly important function in mobile
  communication

US 12.4 billion 2005
estimated US 557 million 2001
Source Hong Kong Trade Development Council
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Way forward

• Concerns about security and the protection of
  personal data
• Security infrastructures is important
• to address
• the identities of the parties involved
• the integrity and confidentiality of the
  information transmitted
• and the non-repudiation and legal status of the
  electronic transactions

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Way forward

• The role of government
• Further promote the e-commerce adoption among the
  public
• Boost citizens to use e-government services
• Enhance protection from fraud
• Protection of consumers right to privacy
• Legal protection against cracking

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Way forward

• Public private partnership
• Disseminate information to SMEs about e-commerce
  policies
• Develop stable and reliable infrastructure
• WiFi?
• Strengthening Consumer Protection
• Unsolicited Electronic Messages Ordinance?

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Useful links related to E-Commerce

• Business Entry Portal
• http//www.business.gov.hk
• Business Licence Information Service
• http//www.licence.tid.gov.hk/
• GS1 Hong Kong
• http//www.gs1hk.org
• Hong Kong Industry On-Line
• http//www.hkiol.org
• Hong Kong Productivity Council
• http//www.hkpc.org
• Hongkong Post
• http//www.hongkongpost.gov.hk/
• Hong Kong Trade Development Council
• http//www.tdctrade.com/
• Small Medium Enterprises (SME) Information
  Centre
• http//www.sme.gcn.gov.hk
• Vocational Training Council
• http//www.vtc.edu.hk/

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• Thank you!
• http//www.sinchungkai.org.hk