Slide 19 of 26
The foregoing commonalities have important implications for the country or origin/country of destination debate.
The ancient debate over country of origin control (lex originis) versus country of destination (lex protectionis) control has emerged as one of the most fundamental issues affecting all aspects of commerce, nationally and internationally, regardless of whether that commerce is electronic or not. (The debate can be described as national for the reason that pre-emption issues within federal states and within supra-national entities like the European Union are essentially issues of origin country/destination country control.) This debate can be seen in taxation, sale of goods and services, banking and payment systems, environmental law, genetically modified organisms, and every aspect of world trade.
This matter is commonly presented in either/or terms. The business community, particularly larger businesses, is generally presented as wanting country of origin control, and the consumer groups and environmental and other local activists are generally presented as wanting country of destination control.
However, the matter is a bit more complex than that.
1. With respect to privacy the EU wants country of origin control and the US wants country of destination control. On the other hand, with respect to genetically modified organisms (to take an example that may have passed the notice of this convention), the EU wants country of destination control and the US wishes the reverse. As a general proposition, across a very wide spectrum of goods and services, the matter seems to come down to a question of whose ox is being gored.
2. Within the EU there is disagreement. The draft EU Directive on Electronic Commerce would use a country of origin approach, but the EU's recently proposed amendments to the Brussels and Logan Conventions would employ a country of destination approach -- a matter that has lead to heated controversy within the EU.
3. In addition, the perception that country of origin control is favored mainly by the larger units within the business community is not correct. An inherent advantage of the Internet is the ability to broaden the base to which it is economically feasible to offer services. A small financial institution can, for example, offer the same access and convenience to a home banking customer of any mega-bank. Requiring such a financial institution to monitor and follow the regulatory requirements of an international panoply of jurisdictions negates that economic benefit. The promise of the Internet is dashed in the complexities.