The Government Green Book on E-commerce

Czech Republic

"A mountain gave birth to a mouse," said Vladimir Smejkal, an authority on IT-law in the Czech Republic, with irony when referring to a draft of the Government Green Book on E-commerce ("GGB"). GGB is a government analysis designed to map the current conditions of e-commerce in the Czech Republic. A team composed of IT-law and e-commerce experts, appointed by the government and the Office for Public Information Systems, has been working on a report since January 2001. The GGB should be the most substantial contribution to even wider discussion that should result in a fully fledged government policy for e-commerce.

At the beginning of January 2002 the Czech government issued a resolution, which takes account of the report and very briefly evaluates main achievements of the GGB. It also includes instructions for selected government members to present the Government White Book on E-commerce by December 31, 2002. As the government statement says, the final statement on e-commerce policy should be "emphasizing the importance of partnership between private and public sectors in regards to knowledge-based economy."

Although the GGB is only a preliminary imprint of a more sophisticated government strategy, it has already instigated controversy among many experts. No matter how arguable the structure and content of the report appears to be, most of them endorse the significance of the government support to e-commerce.

The GGB is divided into five chapters, each chapter covering one significant aspect of e-commerce and suggesting further steps that need to be taken for its development in the Czech Republic. The first chapter analyses legal framework and application of e-commerce within the state administration in the Czech Republic. The advantages of so-called e-government for fiscal policy (e.g. collection of taxes and fees) or administration of statistical data are obvious. However, the relatively unfriendly legal environment in relation to the treatment of electronic documents and also the insufficient state administration and IT infrastructure do not allow for the proper exercise of e-government.

The second chapter concentrates mostly on an evaluation of telecommunications and the IT infrastructure. The GGB exemplifies the impact of high quality infrastructure and efficient market conditions on e-commerce development. Cesky Telecom, as a former monopoly, still keeps its dominant position on the telecommunications market, which, together with complicated and slow deregulation of this sector, prevents development of healthy competition with alternative operators. This lack of competitive market influence results in higher costs and negatively affects any expansion of medium and small size e-commerce businesses in the Czech Republic.

The assessment of the overall business milieu in the fourth chapter reflects a fact that a successful development of e-commerce involves not only modern technologies but also a favourable and cultured business environment. Although an annual EU report on the overall progress towards accession for 2001 rated the Czech economy as fulfilling all aspects of the market economy, there is still an increased need for enhanced business education and positive stimulation for entrepreneurs.

Czech e-commerce is only slowly finding its position within the Czech economy. Only large commercial corporations, companies rendering services, IT companies and some financial institutions have enough resources and know-how to capitalise on the advantage e-commerce is rendering. In the mean time the Czech Republic still experiences only minor upheaval on a smaller scale in selling books, tickets or consumer electronics. A consistent government strategy that complies with the trends of knowledge-based society for the next century as defined in the eEurope initiative, is a good hope for the future of Czech e-commerce.

For further information please contact Ian Parker at ian.parker@cms-cmck.com or Ondrej Rob at ondrej.rob@cms-cmck.com or on 00 420 2 96798111.