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Ecommerce an Attached E-risk With Cyber - Crime

The buying and selling of goods and services over the internet is referred to as e-commerce. It is aimed towards enhancing relationships with customer and increases the revenue one firm might get from a customer. The earliest law governing the E-Commerce transactions can be traced to the United Nations Commission on International Trade Law (UNCITRAL) which was established by the General Assembly in 1966 to harmonize the law of International Trade and adopted the Model Law on E-Commerce on 1996 itself.[1] UNICTRAL has also incorporated a model law for National Governments.

Terminologies like “cyber-attack”, “cyber-warfare”, and “cyber-crime” are newly evolved concepts. Cyber-crimes facilitated by a computer, network or hardware device causing cyber intrusions[2]. They are not infused by any political or national purpose.



The emerging digital economy has shaped our world manifold. A reason for the rise of the growth of internet usage growth is electronic commerce. However, while digital strength has grown in its own accord, so has the cyber-attacks remained unchecked. A growing reason for the decline of e-commerce related activities is the issue of lack of privacy and security in the systems.[3] The signs of such attacks are clearly evident through the attacks of Yahoo, eBay and Amazon, firms that relied on customer information for transaction and its queries.[4] As the number of websites offering such services have increased, novelty and security reforms have developed little. This had led to an emerging threatening cyber-crime, eroding the trust bestowed on E-commerce. The cyber-crime is projected to increase 10-15 percent.


The aim of e-commerce firm is to positively impact transactional returns. An increasing method of determination of competence is ease of business which is to complete transactions. Facilitation of automation, thereby, is essential, enabling which runs the risk of greater vulnerability absent in manual transactions. Therefore, though the website may be open to consumers, the popularity of it would depend on the level of trust, need for security and the measured success of the website.


Another reason for the growing risk of cyber-crime is the nascent stage of development of E-commerce. Although, the world has evolved to be a digital one, the relationships amongst the firms have not evolved to enable efforts against cyber-crimes. A few large firms with technologies may prevent the other firms from having advanced technology. Therefore, the organizational structure dictates the network development, implementation and use. The digital economies, hence, need to be brought under the purview of inter-organizational relationships and inter-organizational networks.

The growth of E-commerce largely rests on the development of these relationships and inter-dependencies.



Risk taking behaviours may be influenced by both organizational trust and also by monitoring and controlling mechanisms designed to reduce risk.[5] Therefore, the reliance is on two distinct and discrete concepts, to enhance security impression on customer behaviour.

Hereupon, two kinds of trust are recognized, swift trust and fragile trust. Customer behaviour when based without a previous relationship, with or without an ability to monitor and an apprehension of the relationship is known as swift trust. Customer behaviour without a previous relationship and in the initial stages is known as fragile trust.


Swift and fragile trust is engaging customers who do not have a relationship or history with the firm. It has often been criticized that trust in its true sense requires time to develop. Therefore, swift and fragile trust is no trust at all.[6] Referred to as “semi-strong” form of trust, there is the existence of vulnerabilities but various Governance methods protect such customer behaviour as well as the firms. Such situations call for a more secure e-commerce transaction facility.


Another security mechanism flaw stated in E-commerce regulation is informational problem. Ordinary markets are based on the immediate and direct relationship between buyer and seller, while E-commerce fails to establish this direct chain. The informational asymmetry is further heightened as there is potential uncertainty of one’s trading partner.[7] Low barriers to entry and ease of exit further act as a challenge to market power and provide enough scope to test its credibility.  Fundamentally, only a website is sufficient in order to enter the market. With the increase in novelty in cyber-crimes, they have increased in number and traditional methods such as frauds have become easier. Although the dimensions of crime have increased, methods to check and hold accountable have not increased in such a huge pace.


“Page jacking” is one of the emerging frauds in the internet realm. It includes misdirecting web surfers to false copies of legitimate businesses and tricking them into revealing passwords and personal identification numbers or diverting them from other pornographic sites.[8] Based on the lines of scam calls, customers are now tricked into email scams for unspecified goods, etc. The free entry and exit of such websites and entities from the market makes it easier to pursue such methods which sum up to the cyber-crimes.


A promise made by E-commerce is the reach of products to the doorstep of the buyers. This might cause uncertain recourse in the event of a dispute. The tracking and initialization of litigation against a product service provider who has proved to be delinquent could prove to be difficult. This could be more difficult if either the firm or the service provider is located in a foreign country. The cost thus incurred, would therefore, be greater than the value of the transaction. low. Digital River-a U.S.- based online wholesaler selling software and music worldwide-has resorted to using software that tracks the national origin of prospective customers, in order to evaluate the potential for fraud.[9]




The multiplicity of hazards and the novelty of crime might lead to the prediction that the growth of the online markets might be less and the decrease in trust might have championed other factors. However, far from reality is this view situated. E-commerce has seen a growing inflow of customers.

One of the possible factors is that, despite growth in cybercrimes, the intermediaries in the process have become more specialized. The E-commerce facilities are easy and catchy. Transactions are, therefore, noted to have been satisfactory for the customers.


Although, such areas require attention, Governmental intervention in the field of E-commerce and its marketing is not sought for. In many cases, Governmental intervention is according to consensus to be used only as a “last resort” for such transactions. The commercial companies and online industries are believed to tackle this menace on their own. However, a national legal environment and encouragement of private industries prevail only with the involvement of public institutions.


The integral concept of Rule of Law is to be highlighted here to bring essential and optimum growth in this field. It includes a well-established political system, efficient legal backing, orderly succession of power and citizens who adhere to the multiple laws and dispute resolution systems in the country.[10] Such rule of law will increase transactional quality in the sectors of E-commerce. A greater transparency would be maintained, thereby, improving the stability. Litigation would also evolve to be simpler while concerning E-commerce. Rule of Law facets efficient punishment techniques to transgressors. This creates room for more honest decisions and high sanctions increase the credibility of such markets. A close knit community of business dealings, would, therefore, discipline and increase trust among people involved in the business.


Apart from this, the channels of payment created should be credible in nature. Online fraud and its different channels need to reduce in every possible method. Intermediaries such as card facilitation play an important role in such process. Credit card companies play an important monitoring and certification role in commercial transactions, providing assurance to both buyers and seller.[11] Growth and such electronic payment methods can provide satisfactory performance in such sectors. Hence, electronic payment systems, foster electronic markets.


*2nd Year Student (BA LLB)

Symbiosis law School, NOIDA



[1] C. Satapathy, Legal Framework for E-Commerce, ECONOMIC AND POLITICAL WEEKLY, VOL. 33, NO. 29/30 (JUL. 18-31, 1998), PP. 1906-1907.

[2]NirKshetri, Diffusion and Effects of Cyber-Crime in Developing Economies,THIRD WORLD QUARTERLY

VOL. 31, NO. 7 (2010), PP. 1057-1079.

[3] Cynthia Ruppel, Linda Underwood-Queen and Susan J. Harrington, e-Commerce: The Roles of Trust, Security, and Type of e-Commerce Involvement, E-SERVICE JOURNAL , VOL. 2, NO. 2 (WINTER 2003), PP. 25-45. (hereinafter Cynthia).


[5]Stephen E. Blythe, Computer Law of Tunisia: Promoting Secure E-Commerce Transactions with Electronic Signatures, ARAB LAW QUARTERLY VOL. 20, NO. 3 (2006), PP. 240-267.

[6]CYNTHIA, Supra note 3.

[7]Jack M. Balkin, Commerce, MICHIGAN LAW REVIEW, VOL. 109, NO. 1 (OCTOBER 2010), pp. 1-51,

[8]CYNTHIA, Supra note 3.

[9]Joanne E. Oxley and Bernard Yeung, E-Commerce Readiness: Institutional Environment and International Competitiveness,JOURNAL OF INTERNATIONAL BUSINESS STUDIES, Vol. 32, No. 4 (4th Qtr., 2001), pp. 705- 723.

[10]Todd J. Zywicki, The Rule of Law, Freedom, and Prosperity, SUPREME COURT ECONOMIC REVIEW


[11]Supra note 9.


Submitted by Ashabari Basu Thakur

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