KUWAIT: The Ministry of Commerce and Industry (MoCI) introduced Wednesday the digital trade law, an ambitious initiative designed to strengthen Kuwait’s digital trade environment by establishing a comprehensive regulatory framework that encompasses all aspects of this growing sector while promoting economic modernization.

The draft law constitutes a major advancement in organizing digital trade activities in the country by facilitating business operations, safeguarding consumer rights, and enhancing the digital economy. By enhancing transparency and setting clear guidelines, the law aims to regulate the relationships between businesses, consumers, and relevant government entities, all while keeping pace with technological advancements and preparing for future challenges.

Minister of Commerce and Industry Khalifa Al-Ajeel presented the draft digital trade law Wednesday at a press conference, with feedback from legal experts, business owners, and companies to be accepted until early January before its final approval by the Cabinet.

The law introduces key terms such as “e-commerce,” “trader,” “practitioner,” “consumer,” and “sensitive data,” defining its scope to include all commercial activities conducted through electronic or digital means for offering or providing products and services. The law also regulates the registration process for businesses, ensuring transparency by requiring all traders to register their online stores with the commercial register. A separate “Practitioners’ Register” will be created for those not registered with the commercial register.

Consumer protection

The Digital Trade Law addresses issues related to organizing professions and specifying approved business locations, ensuring clarity and legal compliance. It also places a strong emphasis on consumer protection, outlining clear obligations for providers of goods and services to disclose their identity, terms and conditions of contracts, and accurate information about the products or services.

Consumers are granted the right to cancel contracts within 14 days, with specific exceptions for products or services that cannot be returned. The law also establishes transparent and effective mechanisms for handling consumer complaints, ensuring compensation in cases of delayed delivery or breach of contract.

The law sets regulations for electronic advertisements to organize online advertising and promotions, including prohibiting misleading ads and the unauthorized use of logos or trademarks. It allows promotional offers without prior approval, as long as clear terms are in place. However, it requires prior approval from the Ministry of Commerce and Industry for discount campaigns to ensure consumer protection.

Electronic payments

Additionally, the law addresses digital documents and digital signatures, setting standards for secure document storage and requiring providers of goods and services to obtain licenses for the use of digital signatures. It ensures that digital signatures cannot be altered or forged and assigns responsibilities in cases of misuse.

The law mandates providers of goods and services to offer electronic payment options compatible with local banking systems and allows the use of advanced technologies such as distributed ledger systems and smart contracts to enhance the consumer experience, provided there is transparency and oversight.

Data, copyright protection

On intellectual property rights, the law prohibits the use of protected content without authorization, holding providers of goods and services accountable for any infringements. It also provides mechanisms for addressing complaints related to these infringements, including imposing fines and blocking non-compliant stores when necessary. The law also addresses cybersecurity, requiring providers to apply strict standards and rules to protect data, including the use of encryption, regular system updates, and reporting security breaches within 72 hours of discovery. Providers will be held liable for any resulting damages.

Furthermore, the law defines the role of the Ministry of Commerce and Industry in overseeing e-commerce and issuing the necessary regulations. It also establishes two committees: one tasked with handling violations and another with resolving disputes. The committees will have the authority to issue warnings, impose fines, and temporarily shut down non-compliant stores, ensuring a well-regulated digital trade environment. — KUNA