Electronic Commerce Act

Question 1

Objectives of E-Commerce Act
(next slides)

Question 2

To facilitate domestic and international dealings, transactions, arrangements, agreements, contracts, and exchanges and storage of information through the utilization of electronic, optical, and similar medium, mode, instrumentality and technology

Question 3

To recognize the authenticity and reliability of electronic documents related to such activitie

Question 4

To promote the universal use of electronic transactions in the government and general public

Question 5

This Act shall apply to any kind of data message and electronic document used in the context of commercial and non-commercial activities to include domestic and international dealings, transactions, arrangements, agreements, contracts and exchanges and storage of information.

Answer 5

SEC. 4- SPHERE OF APPLICATION

Question 6

Refers to information generated, sent, received or stored by electronic, optical or similar means.

Answer 6

ELECTRONIC DATA MESSAGE

Question 7

Refers to any distinctive mark, characteristic and/or sound in electronic form, representing the identity of a person and attached to or logically associated with the electronic data message or electronic document or any methodology or procedures employed or adopted by a person and executed or adopted by such person with the intention of authenticating or approving an electronic data message or electronic document.

Answer 7

ELECTRONIC SIGNATURE

Question 8

Refers to information or the representation of information, data, figures, symbols or other modes of written expression, described or however represented, by which a right is established or an obligation extinguished, or by which a fact may be proved and affirmed, which is received, recorded, transmitted, stored, processed, retrieved or produced electronically.

Answer 8

ELECTRONIC DOCUMENT

Question 9

Information shall not be denied legal effect, validity or enforceability solely on the grounds that it is in the data message purporting to give rise to such legal effect, or that it is merely referred to in that electronic data message.

Answer 9

SEC. 6 - LEGAL RECOGNITION OF DATA MESSAGES

Question 10

SEC. 7 - LEGAL RECOGNITION OF ELECTRONIC DOCUMENTS

Electronic documents shall have the
> legal effect, validity or enforceability as any other document or legal writing, and

(next slides)

Question 11

A.) Where the law requires a document to be in writing, that requirement is met by an electronic document if the said electronic document maintains its integrity and reliability and can be authenticated so as to be usable for subsequent reference, in that

Answer 11

i.) The electronic document has remained complete and unaltered, apart from the addition of any endorsement and any authorized change, or any change which arises in the normal course of communication, storage and display; and

ii.) The electronic document is reliable in the light of the purpose for which it was generated and in the light of all the relevant circumstances.

Question 12

B.) Paragraph (a) applies whether the requirement therein is in the form of an obligation or whether the law simply provides consequences for the document not being presented or retained in its original form.

Question 13

C.) Where the law requires that a document be presented or retained in its original form, that requirement is met by an electronic document if -

Answer 13

i.) There exists a reliable assurance as to the integrity of the document from the time when it was first generated in its final form; and

ii.) That document is capable of being displayed to the person to whom it is to be presented: Provided, That no provision of this Act shall apply to vary any and all requirements of existing laws on formalities required in the execution of documents for their validity.

Question 14

An electronic signature on the electronic document shall be equivalent to the signature of a person on a written document if that signature is proved by showing that a prescribed procedure, not alterable by the parties interested in the electronic document, existed under which
(next slides)

Answer 14

SEC. 8 - LEGAL RECOGNITION OF ELECTRONIC SIGNATURES

Question 15

A.) A method is used to identify the party sought to be bound and to indicate said party’s access to the electronic document necessary for his consent or approval through the electronic signature;

Question 16

B.) Said method is reliable and appropriate for the purpose for which the electronic document was generated or communicated, in the light of all the circumstances, including any relevant agreement;

Question 17

C.) It is necessary for the party sought to be bound, in order to proceed further with the transaction, to have executed or provided the electronic signature; and

Question 18

D.) The other party is authorized and enabled to verify the electronic signature and to make the decision to proceed with the transaction authenticated by the same.

Question 19

SEC. 9-PRESUMPTION RELATING TO ELECTRONIC SIGNATURES

In any proceeding involving an electronic signature, it shall be presumed that

(next slides)

Question 20

A.) The electronic signature is the signature of the person to whom it correlates

Question 21

B.) The electronic signature was affixed by that person with the intention of signing or approving the electronic document UNLESS the person relying on the electronically signed electronic document knows or has notice of defects in or unreliability of the signature or reliance on the electronic signature is not reasonable under the circumstances.

Question 22

SEC. 16 - FORMATION AND VALIDITY OF ELECTRONIC CONTRACTS

An offer, the acceptance of an offer and such other elements required under existing laws for the formation of contracts may be expressed in, demonstrated and proved by means of electronic data message or electronic documents

(next slides)

Question 23

No contract shall be denied validity or enforceability on the sole ground that it is in the form of an electronic data message or electronic document

Question 24

Any or all of the elements required under existing laws for the formation of the contracts is expressed, demonstrated and proved by means of electronic documents.

Question 25

Electronic transactions made through networking among banks, or linkages thereof with other entities or networks, and vice versa, shall be:

Question 26

Deemed consummated upon the actual dispensing of cash or the debit of one account and the corresponding credit to another, whether such transaction is initiated by the depositor or by an authorized collecting party

Question 27

Provided, that the obligation of one bank, entity, or person similarly situated to another arising therefrom shall be considered absolute and shall not be subjected to the process of preference of credits.

Question 28

SEC. 18 - ATTRIBUTION OF ELECTRONIC DATA MESSAGE (see next slide)

Question 29

1.) An electronic data message or electronic document is that of the originator if it was sent by the originator himself.

Question 30

2.) As between the originator and the addressee, an electronic data message or electronic document is deemed to be that of the originator if it was sent:

Answer 30

(a) by a person who had the authority to act on behalf of the originator with respect to that electronic data message or electronic document; or (b) by an information system programmed by, or on behalf of the originator to operate automatically.

Question 31

3.) Addressee can assume message is from originator if agreed procedure is followed or if the access method used identifies it as the originator's.

Question 32

4.) Exceptions: when the addressee receives notice from the originator or fails to exercise reasonable care or use any agreed procedure.

Question 33

5.) The addressee can act on the assumption that the received message is what the originator intended to send unless it knew or should have known about any error.

Question 34

6.) Each electronic message is regarded as separate unless the addressee knew or should have known it was a duplicate.

Question 35

Unless otherwise agreed between the originator and the addressee, the dispatch of an electronic data message or electronic document occurs when it enters an information system outside the control of the originator or of the person who sent the electronic data message or electronic document on behalf of the originator.

Answer 35

SEC. 21- TIME OF DISPATCH OF ELECTRONIC DATA MESSAGES OR ELECTRONIC DOCUMENTS

Question 36

SEC. 22 - TIME OF RECEIPT OF ELECTRONIC DATA MESSAGES OR ELECTRONIC DOCUMENTS Unless otherwise agreed between the originator and the addressee, the time of receipt of an electronic data message or electronic document is as follows:

Question 37

(a) Designated system: receipt occurs when the message/document enters the designated system. - If both are participants, receipt occurs when retrieved by the addressee.

Question 38

(b) Non-designated system: receipt occurs when retrieved by the addressee.

Question 39

(c) No designated system: receipt occurs when the message/document enters any system of the addressee.

Question 40

SEC. 25 - ACTIONS RELATED TO CONTRACTS OF CARRIAGE OF GOODS Without derogating from the provisions of part two of this law, this chapter applies to any action in connection with, or in pursuance of, a contract of carriage of goods, including but not limited to:

Question 41

A. (i) furnishing the marks, number, quantity or weight of goods; (ii) stating or declaring the nature or value of goods; (iii) issuing a receipt for goods; (iv) confirming that goods have been loaded;

Question 42

B. (i) notifying a person of terms and conditions of the contract; (ii) giving instructions to a carrier;

Question 43

C (i) claiming delivery of goods; (ii) authorizing release of goods; (iii) giving notice of loss of, or damage to, goods;

Question 44

D giving any other notice or statement in connection with the performance of the contract;

Question 45

E undertaking to deliver goods to a named person or a person authorized to claim delivery;

Question 46

F granting, acquiring, renouncing, surrendering, transferring or negotiating rights in goods;

Question 47

G acquiring or transferring rights and obligations under the contract.

Question 48

SEC. 26- TRANSPORT DOCUMENTS General rule

Answer 48

Where the law requires that any action referred to contract or carriage of goods be carried out in writing or by using a paper document, that requirement is met if the action is carried out by using one or more data messages or electronic documents.

Question 49

This simply mandates that all government agencies and instrumentalities, bureaus, offices, and agencies, shall create, maintain, accept, process, the filing and/or retention of permits, licenses, certificates of registration, among others, in the form of electronic data messages or electronic documents

Answer 49

SEC. 27 - GOVERNMENT USE OF ELECTRONIC DATA MESSAGES, ELECTRONIC DOCUMENTS AND ELECTRONIC SIGNATURES

Question 50

SEC. 29 - AUTHORITY OF THE DEPARTMENT OF TRADE AND INDUSTRY AND PARTICIPATING ENTITIES This shall direct and supervise the promotion and development of electronic commerce in the country with relevant government agencies, without prejudice to the provisions of Republic Act. 7653 (Charter of Bangko Sentral ng Pilipinas) and Republic Act No. 337 (General Banking Act), as amended.

Answer 50

Department of Trade and Industry (DTI)

Question 51

SEC. 33 - PENALTIES (next slide)

Question 52

a.) Hacking/Cracking Unauthorized access/interference in computer systems Corrupt, alter, steal, destroy data

Answer 52

Penalties: Fine P100,000 to commensurate to damage, imprisonment 6 months to 3 years

Question 53

b.) Piracy: Unauthorized copying, distribution, use of protected material Infringes intellectual property rights

Answer 53

Penalties: Fine P100,000 to commensurate to damage, imprisonment 6 months to 3 years

Question 54

c.) Consumer Act Violations (RA No. 7394): Transactions using electronic data messages/documents

Answer 54

Penalties: As provided in relevant laws

Question 55

d.) Other Violations:

Answer 55

Penalties: Fine up to P1,000,000 or imprisonment up to 6 years

Question 56

RULES ON ELECTRONIC EVIDENCE (next slide) It provides the admissibility of emails, digital signatures and other e-documents in court. The rules are not only applicable in civil, quasi- judicial, and administrative cases but also in criminal cases.

Question 57

Rule 1: Coverage

Question 58

Rule 2: Definition of Terms and Construction

Question 59

Rule 3: Electronic Documents

Question 60

Rule 4: Best Evidence Rule

Question 61

Rule 5: Authentication of Electronic Documents

Question 62

Rule 6: Electronic Signatures

Question 63

Rule 7: Evidentiary Weight of Electronic Documents

Question 64

Rule 8: Business Records as Exception to the Hearsay Rule

Question 65

Rule 9: Method of Proof

Question 66

Rule 10: Examination of Witnesses

Question 67

Rule 11: Audio. Photographic, Video, and Ephemeral Evidence

Question 68

Rule 12: Effectivity

Question 69

A system capable of generating a secure key pair, consisting of a private key for creating a digital signature, and a public key for verifying the digital signature

Answer 69

ASYMMETRIC OR PUBLIC CRYPTOSYSTEM

Question 70

An electronic document issued to support a digital signature which purports to confirm the identity or other significant characteristics of the person who holds a particular key pair.

Answer 70

CERTIFICATE

Question 71

Refers to telephone conversations, text messages, chatroom sessions, streaming audio, streaming video, and other electronic forms of communication the evidence of which is not recorded or retained.

Answer 71

EPHEMERAL ELECTRONIC COMMUNICATION

Question 72

Refers to a system for generating, sending, receiving, storing or otherwise processing electronic data messages or electronic documents and includes the computer system or other similar devices by or in which data are recorded or stored and any procedure related to the recording or storage of electronic data messages or electronic documents.

Answer 72

INFORMATION & COMMUNICATION SYSTEM

Question 73

Refers to an electronic signature consisting of a transformation of an electronic document or an electronic data message using an asymmetric or public cryptosystem such that a person having the initial untransformed electronic document and the signer's public key can accurately determine:

Answer 73

DIGITAL SIGNATURE 1. whether the transformation was created using the private key that corresponds to the signer's public key; and 2.whether the initial electronic document had been altered after the transformation was made.

Question 74

NOTE: The Rules adopted the same definition of electronic document found in R.A. No, 8792, but it included therein digitally signed documents, and any printout or output, readable by sight or other means, which accurately reflects the electronic data message or electronic document. The rules uses the term electronic document interchangeably with electronic data message which adopted the same definition in R.A. No. 8792

Question 75

Whenever a rule of evidence refers to the term writing, document, record, instrument, memorandum or any other form of writing, such term shall be deemed to include an electronic document as defined in these Rules.

Answer 75

Section 1 ELECTRONIC DOCUMENTS AS FUNCTIONAL EQUIVALENT OF PAPER-BASED DOCUMENTS

Question 76

An electronic document is admissible in evidence if it complies with the rules on admissibility prescribed by the Rules of Court and related laws and is authenticated in the manner prescribed by these Rules.

Answer 76

Section 2 ADMISSIBILITY

Question 77

The confidential character of a privileged communication is not lost solely on the ground that it is in the form of an electronic document.

Answer 77

Section 3 PRIVILEGED COMMUNICATION

Question 78

An electronic document shall be regarded as the equivalent of an original document under the Best Evidence Rule if it is a printout or output readable by sight or other means, shown to reflect the data accurately.

Answer 78

Section 1 ORIGINAL OF AN ELECTRONIC DOCUMENT

Question 79

When a document is in two or more copies executed at or about the same time with identical contents, or is a counterpart produced by the same impression as the original, or from the same matrix, or by mechanical or electronic re-recording, or by chemical reproduction, or by other equivalent techniques which accurately reproduces the original, such copies or duplicates shall be regarded as the equivalent of the original.

Answer 79

Section 2 COPIES AS EQUIVALENT OF THE ORIGINALS

Question 80

Notwithstanding the foregoing, copies or duplicates shall not be admissible to the same extent as the original if: (a) a genuine question is raised as to the authenticity of the original; or (b) in the circumstances it would be unjust or inequitable to admit the copy in lieu of the original.

Question 81

AUTHENTICATION OF ELECTRONIC DOCUMENTS The person seeking to introduce an electronic document in any legal proceeding has the burden of proving its authenticity in the manner provided in this Rule.

Answer 81

Section 1 Burden of proving authenticity

Question 82

Section 2 Manner of Authentication

Answer 82

(a) by evidence that it had been digitally signed by the person purported to have signed the same; (b) by evidence that other appropriate security procedures or devices as may be authorized by the Supreme Court or by law for authentication of electronic documents were applied to the document; or (c) by other evidence showing its integrity and reliability to the satisfaction of the judge.

Question 83

A document electronically notarized in accordance with the rules promulgated by the Supreme Court shall be considered as a public document and proved as a notarial document under the Rules of Court.

Answer 83

Section 3 Proof of electronically notarized document

Question 84

An electronic signature or a digital signature authenticated in the manner prescribed hereunder is admissible in evidence as the functional equivalent of the signature of a person on a written document.

Answer 84

AUTHENTICATION OF ELECTRONIC SIGNATURES

Question 85

Manner of Authentication (a) By evidence that a method or process was utilized to establish a digital signature and verify the same; (b) By any other means provided by law; or (c) By any other means satisfactory to the judge as establishing the genuineness of the electronic signature

Question 86

Disputable presumptions relating to: ELECTRONIC SIGNATURES

Answer 86

(a) The electronic signature is that of the person to whom it correlates; (b) The electronic signature was affixed by that person with the intention of authenticating or approving the electronic document to which it is related or to indicate such person's consent to the transaction embodied therein; and (c) The methods or processes utilized to affix or verify the electronic signature operated without error or fault.

Question 87

DIGITAL SIGNATURES

Answer 87

(a) The information contained in a certificate is correct; (b) The digital signature was created during the operational period of a certificate; (c) No cause exists to render a certificate invalid or revocable; (d) The message associated with a digital signature has not been altered from the time it was signed; and, (e) A certificate had been issued by the certification authority indicated therein

Question 88

EVIDENTIARY WEIGHT OF ELECTRONIC DOCUMENTS Section 1 Factors for assessing evidentiary weight

Question 89

(a) The reliability of the manner or method in which it was generated, stored or communicated, including but not limited to input and output procedures, controls, tests and checks for accuracy and reliability of the electronic data message or document, in the light of all the circumstances as well as any relevant agreement;

Question 90

(b) The reliability of the manner in which its originator was identified;

Question 91

(c) The integrity of the information and communication system in which it is recorded or stored, including but not limited to the hardware and computer programs or software used as well as programming errors;

Question 92

(d) The familiarity of the witness or the person who made the entry with the communication and information system;

Question 93

(e) The nature and quality of the information which went into the communication and information system upon which the electronic data message or electronic document was based; or

Question 94

(f) Other factors which the court may consider as affecting the accuracy or integrity of the electronic document or electronic data message.

Question 95

Section 2 Integrity of an information and communication system In any dispute involving the integrity of the information and communication system in which an electronic document or electronic data message is recorded or stored, the court may consider, among others, the following factors:

Question 96

(a) Whether the information and communication system or other similar device was operated in a manner that did not affect the integrity of the electronic document, and there are no other reasonable grounds to doubt the integrity of the information and communication system;

Question 97

(b) Whether the electronic document was recorded or stored by a party to the proceedings with interest adverse to that of the party using it; or

Question 98

(c) Whether the electronic document was recorded or stored in the usual and ordinary course of business by a person who is not a party to the proceedings and who did not act under the control of the party using it.

Question 99

BUSINESS RECORDS AS EXCEPTIΟΝ ΤΟ ΤHE HEARSAY RULE Section 1 INAPPLICABILITY OF THE HEARSAY RULE

Answer 99

A memorandum, report, record or data compilation of acts, events, conditions, opinions, or diagnoses, made by electronic, optical or other similar means at or near the time of or from transmission or supply of information by a person with knowledge thereof, and kept in the regular course or conduct of a business activity, and such was the regular practice to make the memorandum, report, record, or data compilation by electronic, optical or similar means, all of which are shown by the testimony of the custodian or other qualified witnesses, is excepted from the rule on hearsay evidence.

Question 100

The presumption provided for in Section 1 of this Rule may be overcome by evidence of the untrustworthiness of the source of information or the method or circumstances of the preparation, transmission or storage thereof.

Answer 100

Section 2 OVERCOMING THE PRESUMPTION

Question 101

METHOD OF PROOF Section 1 AFFIDAVIT EVIDENCE

Answer 101

All matters relating to the admissibility and evidentiary weight of an electronic document may be established by an affidavit stating facts of direct personal knowledge of the affiant or based on authentic records. The affidavit must affirmatively show the competence of the affiant to testify on the matters contained therein.

Question 102

The affiant shall be made to affirm the contents of the affidavit in open court and may be cross-examined as a matter of right by the adverse party.

Answer 102

Section 2 CROSS-EXAMINATION OF DEPONENT

Question 103

EXAMINATION OF WITNESSES Section 1 ELECTRONIC TESTIMONY

Answer 103

After summarily hearing the parties pursuant to Rule 9 of these Rules, the court may authorize the presentation of testimonial evidence by electronic means. Before SO authorizing, the court shall determine the necessity for such presentation and prescribe terms and conditions as may be necessary under the circumstances, including the protection of the rights of the parties and witnesses concerned.

Question 104

Section 2 TRANSCRIPT OF ELECTRONIC TESTIMONY

Answer 104

When examination of a witness is done electronically, the entire proceedings, including the questions and answers, shall be transcribed by a stenographer, stenotypist or other recorder authorized for the purpose, who shall certify as correct the transcript done by him. The transcript should reflect the fact that the proceedings, either in whole or in part, had been electronically recorded.

Question 105

Section 3 STORAGE OF ELECTRONIC TESTIMONY

Answer 105

The electronic evidence and recording thereof as well as the stenographic notes shall form part of the record of the case. Such transcript and recording shall be deemed prima facie evidence of such proceedings

Question 106

AUDIO, PHOTOGRAPHIC, VIDEO, AND EPHEMERAL EVIDENCE Section 1 AUDIO, VIDEO AND SIMILAR EVIDENCE

Answer 106

Audio, photographic and video evidence of events, acts or transactions shall be admissible provided it shall be shown, presented or displayed to the court and shall be identified, explained or authenticated by the person who made the recording or by some other person competent to testify on the accuracy thereof.

Question 107

Section 2 EPHEMERAL ELECTRONIC COMMUNICATIONS

Question 108

Ephemeral electronic communications shall be proven by the testimony of a person who was a party to the same or has personal knowledge thereof. In the absence or unavailability of such witnesses, other competent evidence may be admitted.

Question 109

A recording of the telephone conversation or ephemeral electronic communication shall be covered by the immediately preceding section.

Question 110

If the foregoing communications are recorded or embodied in an electronic document, then the provisions of Rule 5 shall apply.

Question 111

EFFECTIVITY Section 1 APPLICABILITY TO PENDING CASES

Answer 111

These Rules shall apply to cases pending after their effectivity.

Question 112

Section 2 EFFECTIVITY

Answer 112

These Rules shall take effect on the first day of August of 2001 following their publication before the 20th of July 2001 in twi newspapers of general circulation