E-Commerce in Thailand

Electronic Commerce Development in Thailand
By
Thaweesak Koanantakool, Ph.D.
Director
National Electronics and Computer Technology Center
National Science and Technology Development Agency
Ministry of Science Technology and Environment, Thailand

Last update: May 22, 1999

Abstract

Electronic commerce has become the theme of discussions in major international forums. Taxation, telecommunication infrastructure, information security, and legal policy are among the most controversial factors affecting the success of electronic commerce. Most economies are tackling these issues and trying to develop national frameworks. With all the necessary technical and policy infrastructures set up, one root element to be addressed among users to promote the widespread use of electronic commerce is trust.

The National Electronics and Computer Technology Center (NECTEC) has been working on issues relating to electronic commerce in three main areas: developing the electronic commerce framework for Thailand, drafting six IT laws, and drafting technical specifications and recommendations.

The National Information Technology Committee (NITC) - whose main responsibility is to oversee Information Technology development in Thailand - assigned NECTEC to develop an electronic commerce framework suggesting the roles and responsibilities of government agencies. One of the objectives of the plan is to facilitate private sector involvement in evolving domestic and international electronic commerce arenas.

Parallel to the development of the framework, NECTEC - under the mandate of NITC - is drafting six IT laws, which are Data Protection Law, Computer Crime Law, Electronic Data Interchange Law, Digital Signature Law, Electronic Funds Transfer Law and Universal Access Law. The six laws will serve as an infrastructure for doing electronic commerce and enhance confidence among the members of the electronic transaction playground while providing rules and etiquette for fair play.

Calls have been made for voluntary participation of government agencies, the private sector, educational institutes and independent research centers to draft IT technical recommendations and standards. For instance, the development of the standard coded character set for Thai language, TIS-620, to be used for Thai characters and the registration of the character set with the Internet Assigned Number Authority (IANA) enables web browsers to display the Thai language properly. NECTEC has also played a major role in setting up Thailand's national EDI service provider: TradeSiam.

Recently, NECTEC has led a group of volunteers, namely the Thailand Smart Card Working Group, in developing recommendations for smart card and Public Key Infrastructure (PKI) implementations in Thailand. The recommendations will help stimulate the widespread use of smart card and public key technology, which are the key technologies enabling trust among electronic commerce players.

The current status of the progress on these developments is presented in this report.

Background

In the fast evolving digital environment, one strives to finds the position that would facilitate pursuing ones political, social and financial interests in society. International forums are used to share and exchange views on issues of interest.

The National Information Technology Committee (NITC) was established in 1987 to oversee the policy aspect of information technology development and deployment in Thailand. At present, it has 18 subcommittees steering various IT developments, including three that directly affect the electronic commerce development: the Electronic Data Interchange (EDI) subcommittee, six IT-law subcommittees and the Electronic Commerce Task Force.

The National Electronics and Computer Technology Center (NECTEC) was established in 1992 to carry out research and development in the electronics and computer-related areas. NECTEC operates 15 laboratories specializing in various technologies such as microelectronics, telecommunications, networking, software and linguistics. In 1992, NECTEC was assigned by the government to perform the role of NITC secretariat, in addition to its main role of R&D promotion and implementation.

NITC/NECTEC Working Mechanism

While NITC sketches the plans, NECTEC performs the execution of technical issues. NITC Secretariat coordinates with all stake-holders of electronic commerce in Thailand to make sure that everybody is involved and progress can be made in every agencies.

The recent accomplishments of NITC include:

IT2000, a national policy on Information Technology.

IT for Good Governance Handbook, a study looking at how IT should be applied in the government sector to improve effectiveness and efficiency in administration and service delivery.

SchoolNet, a nation-wide network for schools to access the Internet.

Government Information Network (GINet), a nation-wide, high-capacity network for government agencies.

Software Park, a project aimed at promoting Thai software industry through local software development.

ThaiSarn III, a nation-wide network for universities, education and research in its third generation.

Presently, the role of NITC/NECTEC in electronic commerce development are three fold: the policy framework, the legal aspects, and the technical guidelines and standards.

Electronic Commerce Framework

The NITC's Electronic Commerce Task Force set out to develop an electronic commerce framework that reflects the needs of all parties involved while compromising discordant interests. The task force has taken the step to reach out to all parties involved including government agencies, Internet service providers and computer-related industries. Interviews have been arranged with concerned parties to discuss controversial issues such as the balance between government regulations and promotion of free trade. The task force is tackling controversial issues such as taxation, telecommunication infrastructure, human resource development and technology.

In response to this activity, NITC has proposed setting up Thailand's Electronic Commerce Coordination Center (EC 3 ) where NECTEC would be given a role as focal point in coordinating with other government and private agencies for the development of electronic commerce in Thailand. In general, EC 3 would be established with the following objectives:

To gather information on electronic commerce developments both locally and abroad.
To study such issues as policy, direction and the country's position in regard to the adoption of electronic commerce for Thailand.
To coordinate the development activities of electronic commerce in the government sector.
To encourage the use of electronic commerce in the public and private sectors.

Prior to this proposal, a sub-working group had been formed in August 1998. The group consists of representatives from various government agencies with NITC/NECTEC as secretariat. The main purpose of this working group is to draft an electronic commerce policy framework for Thailand and report to the Electronic Commerce Task Force and NITC, respectively, for endorsement and approval. At present, the working group is in the study stage.

Legal Issues

Overview

To provide a legal basis for the electronic commerce community, NITC launched an IT Law Development Project in 1997 with the following objectives:

To facilitate the electronic commerce environment in Thailand. Because currently there are no fundamental laws which support electronic business transactions, it is vital to promulgate IT law as a crucial legal national infrastructure.
To create business incentives to attract foreign investment. Having fundamental laws such as the Electronic Data Interchange Law, the Digital Signature Law and the Electronic Funds Transfer Law will definitely attract foreign investors to Thailand.
To promote confidence from foreign investors. Foreign investors can be assured that their data and their fundamental rights will be protected under the Data Protection Law and the Computer Crime Law.
To promote and encourage the transfer of technology. It is necessary that there be legal mechanisms which enable the transfer of technology from foreigners.
To enhance fair competition. Fair competition, particularly in telecommunication businesses, would tremendously attract foreign investment, increase employment and the inflow of foreign currencies.
To create potential competitiveness. In the tough competitiveness of business commerce it is important that the state create legal mechanisms which encourage competitiveness from the private sector.
To diminish gaps between information haves and have nots. Any individual shall have access to information at an affordable price irrespective of place of residence or place of work.

Scope

The project has identified the need for six IT-related laws as follows:

Data Protection Law. To protect the right of privacy in the Information Society.
Computer Crime/Computer-Related Crime Law. To criminalize new types of offences in the changing world.
Electronic Data Interchange Law. To set the legal framework in conclusion of electronic contracts.
Digital Signature Law. To provide security of electronic commerce transactions.
Electronic Funds Transfer Law. To promote consumer protection and allocate the liability incurred from the technological risks.
Bylaw of Section 78 of the Thai Constitution (Universal Access Law). To create an equitable information society by promoting universal access to information in the National Information Infrastructure (NII).

Status

NITC has empowered the six subcommittees to study and draft each of the six laws. Each subcommittee is chaired by a prominent legal expert and is comprised of representatives from concerned agencies. Like other subcommittees, NECTEC performs the role of subcommittee secretariat. At present, the scope and issues to be addressed in the work of each subcommittee have been identified. The first set of report on issues regarding EDI and digital signature have been released in a public hearing in April 1999. The event was presided over by H.E.Prime Minister Chuan Leekpai.

Standards and Technical Guideline Issues

Overview

NITC and NECTEC have recognized the importance of interoperability among different parties in order to accelerate the widespread use of electronic commerce. Thedevelopment of standards and technical guidelines is therefore a critical factor. Activities conducted include the development of the Thai character set TIS620, the development of Smart Card standards and the establishment of the national EDI service provider, TradeSiam.

The Development of the Thai Character Set TIS620

TIS-620 is the standard Thai character set used in the Kingdom of Thailand. The standard was issued by the Thai Industrial Standards Institute (TISI), the Thai national standards body, in 1986 and updated in 1990 (additional information about Thai characters). It has been in wide use among Thai communities since then.

In August 1998, TIS-620 was registered with the Internet Assigned Number Authority (IANA) to enable web browsers to display the Thai language properly.

Thailand Smart Card Working Group

In February 1998, the Thailand Smart Card Working Group was formed by NECTEC on the basis of voluntary participation. The members of the working group come from more than 50 government agencies, financial institutes, research and education institutes, and private companies. The working group firmly believes in seamless smart card interoperability and has declared its objectives as:

To develop a set of recommendations for implementing smart card applications in Thailand and propose it to the Thailand Industrial Standards Institute for the standardization process.
To support cooperation among working group members to run a smart card pilot project that will demonstrate the usability of the recommendations. The working group is made up of 2 sub-working groups: the Smart Card Application Sub-working Group (SMAPP) and the Public Key Infrastructure Sub-working Group (SMPKI).

The SMAPP has elected the Bank of Thailand to coordinate the activities among members. The SMAPP has targeted delivery of the pre-draft proposal of its recommendations for public comments by the end of 1998. The recommendations will focus on 4 applications running on smart cards: identification cards, credit/debit/ATM cards, electronic purses, and loyalty programs. These recommendations include business and technical requirements. The business requirements are in Thai while the technical requirements are in English.

NECTEC was elected coordinator of the SMPKI. The SMPKI plans to distribute the pre-draft proposal of its recommendations for public comments by the end of 1998. The recommendations will initially be in Thai and later translated into English for wider audience. They propose how Thailand should implement its Public Key Infrastructure (PKI).

With this working methodology and diverse membership, NECTEC believes that the working groups will be able to develop recommendations that will suit Thailand's needs and be open; thereby facilitating fair competition.

TradeSiam: Thailand's National EDI Service Provider

The Thailand EDI Council (TEDIC), which is one of the subcommittees under NITC, proposed the creation of TradeSiam as a joint venture company between Thai government agencies and the private sector mainly to facilitate international trade. It will start providing services from December 1998. It is to serve as a center to provide EDI services between government agencies and the private sector. In order to operate efficiently, TradeSiam is managed as a private company where it positions itself as a national EDI service provider with the following objectives:

Act as the designated EDI gateway between government agencies and the private sector.
Become the major training center for businesses using EDI.
Coordinate with the Thailand EDI Council in EDI development.

As a one-stop service, trading partners will be able to successfully proceed with trading procedures such as customs declaration, import certification, export license, or electronic funds transfer using the EDI-standard format UN/EDIFACT. TradeSiam will also provide a facility to convert other EDI standards such CARGO*IMP to UN/EDIFACT and vice versa. In addition, it will keep a transaction-log (audit trial) and provide data security and reliable functionality for all trading transactions on a 24- hour basis.

Conclusion

NITC together with NECTEC will pave the way for electronic commerce developments in Thailand by using the electronic commerce framework as the roadmap. The Electronic Commerce Coordination Center (EC 3 ) will facilitate the domestic and international developments in all sectors for efficiency and economical purposes. In order to promote electronic commerce within Thailand, NITC and NECTEC are working together to provide a legal and practical framework by collaborating with other organizations to develop appropriate laws, standards and infrastructure, and to create a favorable environment that will facilitate activities of the private sector, particularly small and medium enterprises.

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