The Privacy and Security Issues essay

E-commerce refers to operating business electronically, primarily over the Internet. People define it as buying and selling products and services through the electronic channel (Manzoor, 2010). It is more convenient because of 24 hour availability, efficient customer and global reach.

In today’s digital economies, buyer data is more important than ever. Businesses are using this data in innovative ways to provide consumers with new and better goods and services. Although many of the buyers of these enterprise data management with confidence, some irresponsible, even reckless way emerge to treat it. The company recently released a variety of privacy innovation is encouraging, many companies - both online and offline mediums are not sufficient to address consumer privacy concerns.

Industry should do better. For every business, privacy should be a rudimentary concern similar to holding track of costs and revenues, or strategic designing. To further this aim, the report suggests a normative structure for how businesses should protect consumers’ privacy. This proposal is proposed to announce policymakers, including assembly as they develop answers, principles, and promise regulations governing privacy and direct and motivate commerce as it evolves more robust and productive best practices and self-regulatory guidelines. The structure is conceived to assist as a policy vehicle for close to privacy, but it encompasses components that contemplate longstanding government Trade Commission (“FTC” or “Commission”) regulation.

Privacy and Security Implications

Do companies pay enough attention to the risk associated with data protection? Privacy is one of the most important issues that e-commerce businesses face today. Many business websites do not attach great importance to profiles of their customers or personal information about them. However, these sites frequently collect a significant amount of personal data that activate liability risks (Ghosh, 2001). It is the responsibility of the business owner to secure the customer’s information from mishap or mishandling. Most companies have started to focus on data security risks in structuring operation and products and dealing with the seller and customers. These companies at least determine that they must do meaningful changes to keep up with data security and legislative risks (Ghosh, 2001). They are either unaware of the risk of data insecurity and obligations, or have insufficient employees or the finances to deal with them. It is a tough task for companies to do business across the state and in the international market because security laws vary in different sectors and countries. This data is important to the business. Otherwise, it will not survive in the market. Therefore, the laws for website privacy protection have been adopted worldwide (Garfinkel & Spafford, 2011). Their objectives are various: some attempt to resolve the past injustice of the authoritarian regime, others seek to promote e-commerce, and many ensure the compliance of the law and try to facilitate global trade. Although the data protection requirements vary according to legislation, all demand that personal information must be as follows:

  • Obtained fairly and legally;
  • Used only for primarily specified function;
  • Sufficient, relevant and not excessive to reason;
  • Accurate and updated;
  • Accessible to the subject;
  • Protected;
  • Completely destroyed after its using;

The economic environment is characterized by continuous technological development. In particular, since the last decade of the 20th century, these developments occurred frequently (Garfinkel & Spafford, 2011). Now, there are virtual games, virtual shops that create the realities of virtual world and need of virtual currencies to function in this environment. Therefore, electronic goods can be traded smoothly.  

It is difficult to identify the moment when companies began implementing e-commerce privacy policies.  The concept of stand alone firm privacy policy evolved from concern with how federal government utilized the personal identifying information. Continual advancement in technology allowed a larger amount of personal information to be aggregated and deliver more rapidly & efficiently. This efficiency  triggered  realization that such technology requires serious privacy implications daily (Garfinkel & Spafford, 2011). The regulation void help bring about many of the problems currently facing in privacy policies because unregulated companies are not required to fulfill or even think about secure information practices or privacy practices for internal information.

Many of businesses involve e-commerce activities around the world; it has grown with the increase in the use of the internet. It may sound very simple to start e-business is just creating the website, but actually it is not that simple. It has many complications. Each country has separate regulations for governing the E-commerce activity (Alghamdi, 2011). There are many things which should be considered in E-commerce business i.e. website layout, the manner in which operating business activity and content. It is very essential to meet the legal requirement of the respective country daily (Garfinkel & Spafford, 2011).

E-commerce has a wide range of complex policy and legal issues encountered by government and business throughout the world. E-commerce laws and policies have undergone significant change in recent years in key areas of e-commerce which are: regulation of online content, patent for software, cybercrime, and electronic contracts, copyright of the content, domain names, liability intermediaries and taxation of internet businesses. These developments to formulate diverse strategies have been made to reduce the loopholes of e-business.

The government should develop policies to monitor and supervise the issuers of electronic money. Governments have control over interest rates, and it plays a key role as government bank. It seems that virtual money will completely replace the conventional money so that central banks need to maintain the system of converting the real and virtual cash (Alghamdi, 2011). E-payment systems are vital for improving the efficiency of electronic commerce, but these payments system has risks as well as benefits; the key risk is operational risk (associated with the security, inefficient usage of the electronic system and misuse by the customer), legal, liquidity, credit, interest rate risks (Sharma, 2011). One of the key implications for macroeconomic policy to create an institute that moderate the risk and encourage innovation & ideas in designing of new electronic payment systems. The  electronic cash system has potential advantages not only in the conventional money system but also over virtual financial instrument. It reduces the transaction cost and allows an increase in efficiency by maximizing profits.  Developing policies for the efficient electronic financial instrument has lots of potential to transform the economic activity by encouraging the development of the internet to deliver low cost exchange. An effective e-cash system has potential to address the limitation of conventional cash system i.e. its capacity to limit the fraud and money laundering (Ghosh, 2001).

E-Businesses should take up “privacy by design” approach by building privacy protections into their everyday enterprise practices. Such protections encompass supplying sensible security for buyer information and figures, collecting only the information and figures required for an exact enterprise purpose, keeping data only as long as essential to fulfill that reason, securely disposing of data no longer being used, and applying reasonable methods to encourage data correctness. In addition, enterprises and enforcement procedures shall apply sound privacy practices, through their associations, including, for example, designated staff to oversee privacy issues, education workers, privacy issues, and work to develop new products and services, privacy reconsideration (Alexander, 2011). Such concepts are not new, but the time has arrived for commerce to apply them systematically. Implementation can be scaled to each company’s enterprise operation. Companies that assemble and use small amounts of non-sensitive consumer facts and figures should not have to dedicate the same level of resources to applying privacy programs as businesses that assemble huge allowances of consumer facts and figures, assemble facts and figures of a perceptive environment, or enlist in the business of trading consumer information.

Companies are given choices to buyers about their data practices in an easier, more simplified way than has been utilised in the past. Under this approach, buyer alternative would not be essential for a restricted set of “commonly acknowledged” data practices, therefore allowing clearer, more significant choice with respect to practices of larger concerns (Alghamdi, 2011). This constituent of the proposed structure reflects the notion that it is sensible for companies to engage in certain routinely accepted practices – namely, product and service fulfilment, interior procedures such as improving services suggested, deception avoidance, lawful compliance, and first-party trading. Some of these practices such as, where a retailer assembles a consumer’s address solely to consign a product the buyer organised, are obvious from the context of the transaction, and thus, permission for them is inferred. Other ones are adequately accepted – or necessary for public principle causes – that companies need not demand consent to engage in them. By clarifying those practices for which consumer consent is pointless, companies will be adept to simplify their communications with buyers, decreasing the problem and disarray on consumers and businesses alike.

Online companies should take effective measures to make their data practices more clear to buyers. For example, whereas privacy principles may not be a good device for broadcasting with most buyers, they still could play a significant function in encouraging transparency, responsibility, and competition among companies on privacy matters – but only if the principles are clear, concise, and easy-to-read. Therefore, companies should improve their privacy principles so that involved parties can contract facts and figures practices and choices over companies.

Companies should be allowed buyers with sensible access to the data that businesses maintain about them, especially for businesses that do not merge with buyers exactly, such as facts and figures brokers. Because of the important costs associated with access, employees accept as true that the extent of getting access to should be proportional to both the sensitivity of the facts and figures and its proposed use. In addition, all entities should supply robust notice and obtain affirmative consent for material, retroactive alterations to facts and figures policies.


Countries should make efforts to educate consumers about commercial data practices and the choices available to them. It helps them understand the importance of privacy of information and play a vital role in promoting transparency, accountability, and competition between companies on privacy issues. The customer’s understanding of commercial data collection of e-businesses and use of their information is essential to facilitate competition of privacy of information across companies.


  1. Alexander, N. M. (2011). Global trends in mediation. New York, NY: Kluwer Law International.
  2. Alghamdi, A. M. (2011). The law of e-commerce: E-contracts, e-business. New Albany, Ohio: AuthorHouse.
  3. Garfinkel, S., & Spafford, G. (2001). Web security, privacy & commerce. Washington, DC: O'Reilly Media, Inc.
  4. Ghosh, A. K. (2001). E-commerce security and privacy. New York, NY: Kluwer Academic.
  5. Habiyaremye, J. M. (2011). E-commerce security threats. New York, NY: GRIN Verlag.
  6. Kenneth, C. L. , & Traver C. G. (2011). E-commerce: Business, technology, society (7th ed.). Upper Saddle River, NJ: Pearson Education Limited.
  7. Manzoor, A. (2010). E-commerce. Saarbrucken: LAP LAMBERT Academic Publishing.
  8. Qin, Z. (2010). Introduction to e-commerce. London: Springer.
  9. Sharma, S. K. (2011). E-adoption and socioeconomic impacts: Emerging infrastructural effects. Hershley, PA: Idea Group, Inc.

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