data privacy

ASEAN’s E-Commerce Agreement

ASEAN’s E-Commerce Agreement

The Southeast Asian digital economy is already estimated to be worth US$72 billion.  The digital economy is on track to hit $240 billion by 2025, more than $40 billion higher than originally projected in a Google/Temasek study.  The region is increasingly home to important unicorns like Grab, GoJek, Lazada, Sea and Tokopedia.  Getting these firms and others that follow to flourish requires a nurturing policy framework.  So far, ASEAN member states have had limited experience in crafting complementary digital regulations.  At the domestic level, many ASEAN countries are headed in problematic directions—creating policies in various areas that could dramatically impede the ability of future unicorns to grow and thrive and strangling the prospects for smaller firms along the way. Hence the necessity for ASEAN to start to tackle e-commerce and digital trade in a regional manner.  The agreement reached in November puts in place some useful provisions to get going.  It urges member states to use paperless trading schemes and the use of information (other than financial services) via electronic means.  It encourages members to be transparent about consumer protection measures and urges online personal information protection.

Taking Data Seriously

These individual pressures have to be balanced with the needs of companies.  To effectively scale, firms are increasingly interested in building infrastructure that does not always match geographic boundaries of countries.  Citizen data and information of all sorts can be moved across borders and firms generally desire more movement rather than less.  Businesses have strong reputational reasons for wanting to protect customer information.  Governments, of course, are deeply concerned about protecting the rights of their own citizens and the security of their countries.  Officials have to balance the sometimes competing demands of business and consumer privacy or business and national security issues.  Toss into this volatile mix rapidly changing technology and a legal structure that moves on a much slower timescale and it becomes clear why rules on managing data flows in Asia has started to fragment.