INTRODUCTION
The term ‘EnfTech’ refers to ‘Enforcement Technology’.[1] It is used to describe the use of technology by enforcement agencies for consumer protection. This project was initiated by Prof. Christine Riefa and Liz Coll in 2022 to explore how digital technology can be utilized to properly enforce consumer-related laws, mainly in this era of the digital age[2]. It is funded by the UK Research and Innovation Policy Fund of the University of Reading. Further, the UN guidelines for Consumer Protection also consider the need for the protection of consumers in this digital age.[3]
CROSS-BORDER ENFORCEMENT OF CONSUMER LAW
The EnfTech project now aims at cross-border enforcement of consumer protection and international cooperation. Due to rapid digitalization, there is also growth in e-commerce activities among consumers at the international level. This has led to several disadvantages:
- Misrepresentation of products;
- Unfair trade practices;
- Fake reviews
- Sale of sub-standard and dangerous goods, etc.
Although the laws related to consumer protection are being amended and replaced to adapt to the digital age there is difficulty in the proper enforcement of these laws and ensuring consumer protection. The positive side is that substantive laws are very helpful in dealing with the issues of international consumerism but the negative side is that the growth of procedural law is not satisfactory which leads to the problem of effective enforcement of consumer laws. Cross-border consumers are prone to price discrimination, Artificial Intelligence biases, sub-standard and damaged products, etc. The consumers are unable to protect their rights and interests so there is a need for the development of a tool to assist the consumers.
USE OF TECHNOLOGY TO DEAL WITH THE ILL EFFECTS AND EXCESS OF TECHNOLOGY
The use of EnfTech to cope with the challenges related to e-commerce and online consumer portals is a step in using technology to eradicate excess technology.[4] It can help in analyzing consumer transactions and complaints, it can also help in bridging the gap between consumer legislation and digitalization. The technology can serve many functions ineffective enforcement of consumer protection laws. However, there are many challenges associated with the use of such technology.
The main issue is related to the data quality and the ability to transfer it to the enforcement agencies. Also, there are no strategies for false consumer complaints or scams. There is also a threat that the enforcers may misuse the technology for their benefit or economic reasons. There is a need to develop such technology that works on the principle of coordination and collaboration between the supervisor and enforcement authorities.
TECHNOLOGICAL APPROACH RELATED TO CONSUMER ENFORCEMENT
The technology has been used by the Companies to ensure regulation and supervision of processes and the concept of such enforcement technology is new in this sector. The other forms of technology are as follows:
SupTech: It is a technology system used for supervising the process.
RegTech: It is a technological approach used to regulate the process.
The companies have utilized these two approaches to ensure efficient management of the process and to ensure compliance. But the concept of enforcement technology in consumer protection i.e. EnfTech is a newer approach that could ensure effective enforcement and can implement direct enforcement action by providing warnings, takedowns, and sanctions. It can also help in enforcing remedies like a refund, compensation, or correction of the service, etc. However, there are several examples of the use of EnfTech by private actors in the areas related to trade by traders and police suppliers.
ENFTECH AT THE INTERNATIONAL LEVEL
EnfTech has been used by companies that operate at the international level or across borders. Companies like Alibaba and YouTube have been utilizing it for effective cross-border management. It is also used by multi-stakeholder organizations like Internet Watch Foundation to work with different legal jurisdictions of different countries. To get large-scale use of EnfTech, the following factors are to be considered:
Data Standards: The information is required by the enforcement authorities to work and there is also a need to digitalize reporting instructions and convert the information into machine language. These systems are also required to be uniform so that effective cross-border communication can be carried on.
Data Types: The digital consumer platforms are not subject to the regulatory requirement needs of another sector. The required data also involves real-time performance data. Also, these technology systems need regular updates and staff for effective working.
MERITS OF USING ENFTECH
The following are the positives related to the use of EnfTech in the digital enforcement of consumer protection laws:
High-speed and volume of digital transactions: The use of such technologies helps in the proper analysis of high-volume and high-speed transactions and assists in enforcement. This could help in finding and spotting those traders who cheat on consumers. This could help in tracing the person from a digital platform to this practical and physical world. It will prevent consumers from fake and harmful products.
Dealing with the problem of analyzing harms and priorities: The analysis of harms can help in improving the enforcement agenda and priorities. The challenges like lack of strategic and evidence-based priority are to be dealt with. These challenges can be easily handled with the use of EnfTech and could be advantageous for consumers.[5]
Resolving unfair Contractual clauses: The issues related to unfair contractual terms can also be resolved with the use of such enforcement technologies. There could be a situation where no damage is suffered but the terms of the contract are broken so EnfTech could identify such cases and alert the company to prevent a breach of the terms.
Helps in dealing with difficult present enforcement process: EnfTech can also help in reversing the present consumer’s laws enforcement process followed by the consumers like collecting evidence, taking matters to ADR to the courts, etc.
CHALLENGES ASSOCIATED WITH THE USE OF ENFTECH
There are some challenges associated with the use of EnfTech, which includes the following:[6]
Exacerbating bias: More and more reliance on data is a predicted risk that could arise in this technology and can lead to exacerbating bias.
Company resistance: This technology needs international cooperation for effective enforcement, but some companies in different jurisdictions may not be interested in cooperating.
Complex delivery: As the decisions will be generated by the use of technology so it may become difficult for the consumers and other stakeholders to understand the situations of consumer law infringement.
Self-deleting of encrypted data: The companies may use the technique of deleting the encrypted data and make investigations into consumer law-related offenses difficult.
Digitsing related problems: EnfTech needs the conversion of data from machine language to one that is understandable by humans in practical life and vice-versa. There could be digitization of a broken system. There is a need to create a guard against the less optimal systems. For ex- in the current situation, Apple didn’t change its business practices but was ready to pay a fine to the Netherlands Competition Authority. This shows that multinational companies may refuse to comply with the enforcement process.
Lack of expertise and knowledge sharing: The lack of expertise and knowledge sharing amongst the enforcement agencies could also become a hindrance to effective management and work of the EnfTech.
CONCLUSION
The EnfTech term stands for ‘Enforcement Technology’. It is a technology that could help in the cross-border enforcement of consumer protection-related laws in the present digital age. This project seeks international cooperation on consumer law-related matters. This project aims to improve the practical knowledge of the enforcement authorities and to support them to work efficiently. It also creates a new generation of enforcers which could help in cross-border enforcement of consumer protection.
Author(s) Name: Leezer Kaur (Army Institute of Law, Mohali)
References:
[1] ‘EnfTech’ <www.enftech.org/enftech> accessed 12 July 2023
[2] ‘Introducing EnfTech: A technological approach to consumer law enforcement’ (UNCTAD, 20 April 2023) <https://unctad.org/system/files/information-document/ditc-comp-20042023-programme-v2.pdf> accessed 13 July 2023
[3] ‘Why is cross-border enforcement of consumer law so challenging?’ (EnfTech, 16 March) <www.enftech.org/blog/why-is-cross-border-enforcement-of-consumer-law-so-challenging> accessed 14 June 2023
[4] Introducing EnfTech: A technological approach to consumer law enforcement (n 2)
[5] ‘Why do we need EnfTech?’ (EnfTech, 16 March) <https://www.enftech.org/blog/why-do-we-need-enftech> accessed 13 June 2023
[6] Why is cross-border enforcement of consumer law so challenging? (n 3)
