Law No. 2014-024 on Electronic Transactions

REPOBLIKAN'I MADAGASIKARA Fitiavana-Tanindrazana-Fandrosoa ————— PRESIDENCE DE LA REPUBLIQUE ————— LOI N° 2014-024 Sur Les Transactions Electroniques. EXPOSE DES MOTIFS In recent years, the business world has experienced a significant leap in the evolution of contract conclusion procedures. Whereas concluding contracts previously always required the physical meeting of contracting parties followed by drafting an agreement, the situation is entirely different today following the advent and remarkable growth of new information and communication technologies. Indeed, without completely supplanting traditional contract conclusion methods, the virtual world of the Internet occupies a very important place in exchanges. Today it is almost impossible for a State to ignore its existence, risking seeing its entire system evolve in total autarky and, at worst, lag behind the significant advantages provided by using these new procedures.

Introduced in industrialized countries around the early 2000s, transactions conducted via electronic communication systems, known by the simplified terms 'e-commerce', 'electronic commerce' or 'electronic transactions', are currently in their infancy in Madagascar. It is interesting, however, to understand that these emerging practices operate outside any legal framework due to the lack of established legislative or regulatory texts. This situation is perilous for several reasons. On the one hand, it does not provide concerned parties with a legal framework defining everyone's rights and obligations. On the other hand, it creates uncertainty regarding the conduct to be taken in case of violation of said rights. Consequently, it stifles any investment initiative in this field due to the lack of security, which is a highly valued criterion in business.

Thus, under the joint initiatives of the Ministry of Trade and Consumption, the Ministry of Justice, and private sector professionals, several initiatives have emerged to try to rectify the situation, which is far from being definitively compromised. Accordingly, Decree No. 2012-827 of September 18, 2012, establishing the 'Steering Committee for the Development of Electronic Commerce' (CPDCE), was adopted. Highly evocative in its name, said committee primarily works on developing strategies to ensure the growth of Electronic Commerce in Madagascar.

In the interest of efficiency, the Steering Committee decided to create several sub-commissions to develop texts meeting the needs of Electronic Commerce. The 'electronic transactions' sub-committee, responsible for drafting this text, stems from this initiative. The committee is multi-sectoral as it comprises, among others, several technicians from ministerial departments concerned with electronic commerce, technicians operating in the communication and telecommunications field such as OMERT, GOTICOM, TELMA, and technicians representing the banking sector such as the Central Bank of Madagascar and primary banks.

It is important to note that the text is largely inspired by the work of the United Nations Commission on International Trade Law (UNCITRAL), in particular, the 2005 United Nations Convention on the Use of Electronic Communications in International Contracts and the 1996 Model Law on Electronic Commerce, amended in 1998.

In general, the text aims to establish a precise legal framework to regulate electronic commerce in Madagascar. It comprises 35 articles and is divided into four main parts.

Part 1, titled 'GENERAL PROVISIONS', comprises five articles and deals, among other things, with the definition of key terms contained in the text, its scope of application, and the location of parties.

Part 2 consists of seven articles and is titled 'ELECTRONIC TRANSACTIONS'. Article 6 of this second part refers to the Law on General Theory of Obligations regarding electronic writing and its probative value.

Part 3, dedicated to 'ELECTRONIC CONTRACTS', comprises five articles. It deals notably with questions related to the formation and validity of contracts concluded within electronic commerce. It also addresses the obligation to make contractual clauses available, which applies to any person offering goods or services electronically.

The text cannot be complete without 'ELECTRONIC PAYMENT'; hence, Part 4 is so titled. This final part comprises seventeen articles grouped into two sections titled respectively 'card payment' and 'online payment'.

Such is the object of this law.

REPOBLIKAN'I MADAGASIKARA Fitiavana-Tanindrazana-Fandrosoa ————— PRESIDENCE DE LA REPUBLIQUE ————— http://www.cnlegis.gov.mg/droit.malagasy/wp-ext/legis/afficherDoc.ph... 1 of 8 03/07/2017 10:27

LOI N° 2014-024 Sur Les Transactions Electroniques. L’Assemblée nationale a adopté en sa séance du 05 novembre 2014, LE PRESIDENT DE LA REPUBLIQUE, Vu la Constitution, Vu la décision n° 28 - HCC/D3 du 3 décembre 2014 de la Haute Cour Constitutionnelle, PROMULGUE LA LOI DONT LA TENEUR SUIT : PARTIE I : DISPOSITIONS GENERALES Article 1. Definitions For the purposes of this law: a) The term 'communication' refers to any statement, declaration, notice of default, notification or request, including an offer and acceptance of the offer, that parties are required to perform or choose to perform in relation to the formation or performance of a contract. b) The term 'electronic communication' refers to any communication performed by parties by means of a data message. c) The term 'addressee' of an electronic communication refers to the party to whom the sender intends to send the electronic communication, but not the party acting as an intermediary for this communication. d) The term 'Electronic Data Interchange (EDI)' refers to the electronic transfer of information from computer to computer utilizing an agreed standard to structure the information. e) The term 'fixed establishment' refers to any place where a party has a non-transitory installation to conduct an economic activity, other than the temporary supply of goods or services, and from a determined location. f) The term 'sender' of an electronic communication refers to the party by whom, or on whose behalf, the electronic communication was sent or created before being possibly stored, but not the party acting as an intermediary for this communication. g) The term 'intermediary' refers, in the case of a particular data message, to the person who, on behalf of another, sends, receives or stores the message or provides other services related to it. h) The term 'data message' refers to information created, sent, received or stored by electronic, optical, other digital technology means or analogous means, in particular Electronic Data Interchange (EDI), electronic mail, Short Message Service (SMS), Multimedia Message Service (MMS), any other digital or electronic message, telegraph, telex, and facsimile. i) The term 'electronic payment' refers to the set of financial transactions carried out entirely or partially on an electronic or digital communication network. j) The term 'electronic signature' refers to electronic data contained in a data message or attached to or logically associated with said message, which can be used to identify the signatory in relation to the data message and indicates that they approve the information contained therein. k) The term 'information system' refers to a system used to create, send, receive, store or otherwise process data messages. l) The term 'automated messaging system' refers to a computer program, electronic means or other automated means used to undertake an action in response wholly or partly to data messages or operations, without human intervention or control for each action undertaken or response produced. m) The term 'electronic payment means' refers to any mode of payment that can be realized using magnetic cards, electronic money, or any other technology allowing payment by data transfer.

Article 2. Scope of Application This law applies to any information, of whatever nature, taking the form of a data message used where one of the parties participates in the context of commercial activity. 1. 2. It does not replace any rule of law aimed at protecting the consumer. 3. It does not derogate from existing regulations relating to any of the following elements: a) operations on a regulated stock market; b) foreign exchange operations; c) interbank payment systems, interbank payment agreements or clearing and settlement systems relating to securities or other financial instruments or assets; d) transfers of security interests relating to securities or other financial instruments or assets held with intermediaries, or sale, loan, holding or repurchase agreements for these values, assets or instruments; e) bills of exchange, promissory notes, letters of carriage, bills of lading, warehouse receipts nor any document or instrument transferable giving the bearer or beneficiary the right to demand delivery of goods or payment of a sum of money.

Article 3. Interpretation

1. For the interpretation of this law, account shall be taken of its international origin and the need to promote uniformity in its application and respect for good faith;
2. Questions concerning matters governed by this law that are not expressly settled therein shall be resolved in accordance with the general principles on which it is based.

Article 4. Location of Parties' Establishments

1. For the purposes of this law, a party is presumed to have its fixed establishment at the place it has indicated, unless another party demonstrates that the party giving this indication does not have an establishment in that place.
2. In the case where a party has not indicated a fixed establishment and has more than one establishment, the fixed establishment to be taken into account for the purposes of this law is that which has the closest relationship with the underlying transaction, taking into account the circumstances known to the parties or contemplated by them before or at the time of concluding the contract.
3. If a natural or legal person does not have a fixed establishment, their habitual residence shall serve as such provided that there is a stable, repeated or continuous activity.
4. A place does not constitute a fixed establishment solely because it is the location: a) where the equipment and technology supporting an information system used by a party in relation to contract formation are located; b) where other parties can access this information system.
5. The mere fact that a party uses a domain name or an electronic address associated with a country does not constitute a presumption that its fixed establishment is located in that country; only the place where there is a stable, repeated or continuous activity shall be taken into account.
6. The fixed establishment is presumed to be located at the place where the activity is exercised provided that it is stable, repeated or continuous.
7. A legal person is presumed to be represented in Madagascar when it exercises a stable, repeated or continuous activity there.

Article 5. Information Obligations No provision of this law affects the application of a rule of law requiring parties to communicate their identity, establishment or any other information, nor does it exempt a party from the legal consequences to which it would be subject by making inaccurate, incomplete or false declarations in this regard.

PARTIE II : LES TRANSACTIONS ELECTRONIQUES Article 6. On Writing

1. When the law requires information to be in writing, a data message satisfies this requirement:

• if the information it contains is accessible for subsequent reference;
• if there is a reliable guarantee as to its integrity from the moment of its creation.

2. The integrity of the information is assessed by determining whether it has remained complete and unaltered, except for the addition of any endorsement or modification occurring in the normal course of communication, storage and display. It has the same probative value as writing on paper.

Article 7. Retention of Messages

1. When a rule of law requires certain documents, records or information to be retained, this requirement is satisfied if data messages are retained, subject to the following conditions: a) the information contained in the data message must be accessible for subsequent reference; b) the data message must be retained in the form in which it was created, sent or received, or in a form that accurately reproduces the information created, sent or received; c) the information that allows determining the origin and destination of the data message, as well as date and time indications of sending or receiving, must be retained if they exist.
2. The obligation to retain documents, records or information in accordance with paragraph 1 above does not extend to information whose only purpose is to enable the sending or receiving of the data message.
3. The requirement referred to in paragraph 1 above may be satisfied by using the services of another person, subject to the conditions set out in paragraphs a, b and c of that paragraph being met.

Article 8. Time and Place of Sending and Receiving a Data Message

1. The time of sending a data message is:

• the time when it leaves an information system under the control of the sender; or,
• the time when it is received, if the data message has not left an information system under the control of the sender or the party sending it on behalf of the sender.

2. The time of receiving a data message is:

• the time when it can be retrieved by the addressee at an electronic address designated by that party; or,
• the time when it can be retrieved by the addressee at another of its electronic addresses and when that party becomes aware that it has been sent to that address. A data message is presumed capable of being retrieved by the addressee when it arrives at that party's electronic address.

3. A data message is deemed to have been sent from the place where the sender has its establishment and received at the place where the addressee has its establishment, these places being determined in accordance with Article 4 of this law.
4. Paragraph 2 of this article applies even if the place where the information system, which constitutes the medium for the electronic address, is located differs from the place where the data message is deemed to have been received according to paragraph 3 of this article.

Article 9. Legal Recognition of Data Messages

1. The legal effect, validity or enforceability of information is not denied solely on the ground that it is a data message.
2. Information is not deprived of its legal effects, validity or enforceability solely on the ground that it is not incorporated in the data message presumed to produce legal effects, but is merely referenced therein.
3. In the relationship between the sender and addressee of a data message, the legal effect, validity or enforceability of a manifestation of will or other declaration is not denied solely on the ground that it takes the form of a data message. However, a manifestation of will or any other declaration thus expressed may be invalidated for a reason other than its dematerialized form.

Article 10. Attribution of Data Messages to the Sender A data message originates from the sender if it was sent by the sender itself.

Article 10 bis. In the relationship between the sender and addressee, a data message is deemed to originate from the sender if it was sent: a) by a person authorized to act in that capacity on behalf of the sender; or b) by an information system programmed by the sender or on its behalf to operate automatically.

Article 10 ter. In the relationship between the sender and addressee, the addressee is entitled to consider that a message originates from the sender and act accordingly: a) if, to ensure that the data message originated from the sender, it correctly applied a procedure previously agreed upon with the latter; b) if the data message as received results from the acts of a person who, by virtue of its relationship with the sender or an agent thereof, has implemented a method published by the sender, in a restricted or broad manner, as a means of identifying data messages originating from him.

Article 10 quarto. Article 10 ter is not applicable: a) As soon as the addressee has been notified by the sender that the data message did not originate from him and has had a reasonable time to act accordingly; or b) In a case falling under paragraph b) of Article 10 bis, when the addressee knew or ought to have known, having taken reasonable steps or used an agreed procedure, that the data message did not originate from the sender.

Article 11. When the data message originates or is deemed to originate from the sender, or when the addressee is entitled to act on this presumption, the addressee is entitled to consider and act as if the data message as received was that which the sender intended to send him. The addressee is not entitled to act if it knew, or ought to have known by taking reasonable steps or using an agreed procedure, that the transmission resulted in an error in the data message as received.

Article 12. Receipt of Data Messages by the Addressee

1. Except insofar as it concerns the sending or receiving of the data message, this article does not aim to settle legal consequences that may arise either from this message or from the acknowledgement of receipt.
2. If the sender has not agreed with the addressee that the acknowledgement of receipt will be given in a particular form or according to a particular method, receipt may be acknowledged: a) by any communication, automated or otherwise, originating from the addressee, or b) by any act of the addressee, sufficient to indicate to the sender that the data message has been received.
3. If the sender has declared that the effect of the data message is subject to the receipt of an acknowledgement of receipt, the data message is considered not to have been sent until the acknowledgement of receipt has been received.

Article 12 bis. If the sender has not declared that the effect of the data message is subject to the receipt of an acknowledgement of receipt and has not received an acknowledgement of receipt within the fixed or agreed time limit, or, when no time limit has been fixed or agreed, within a reasonable time, the sender may: a) Notify the addressee that no acknowledgement of receipt has been received and set a reasonable time limit within which the acknowledgement of receipt must be received; and b) If the acknowledgement of receipt is not received within the time limit referred to in the above paragraph, and upon notification addressed to the addressee, consider that the data message has not been sent or exercise any other right it may have.

Article 12 ter. 1. When the sender receives the acknowledgement of receipt, the data message in question is deemed to have been received by the addressee. This presumption does not imply that the electronic communication corresponds to the message received. 2. When the acknowledgement of receipt indicates that the data message in question conforms to technical conditions either agreed upon or set out in applicable standards, these conditions are presumed to be met.

PARTIE III : LES CONTRATS ELECTRONIQUES Article 13. Formation and Validity of Contracts Unless otherwise agreed between the parties, an offer and acceptance of an offer may be expressed by electronic communication. When a data message is used for the formation of a contract, its validity, proof or enforceability is not denied solely on the ground that a data message has been used.

Article 14. Invitations to Treat (Offers) A proposal to conclude a contract made through one or more electronic communications, which is not addressed specifically to one or more parties but is generally accessible to parties using information systems, including by means of interactive applications allowing orders to be placed through these information systems, shall be considered as constituting only an invitation to treat unless it clearly indicates the intention of the party making the proposal to be bound in case of acceptance. An invitation to treat becomes contractual only from the moment when both parties have explicitly marked their agreement.

Article 15. Use of Automated Messaging Systems for Contract Formation The validity or enforceability of a contract formed by the interaction of an automated messaging system and a natural person, or by the interaction of automated messaging systems, cannot be contested solely on the ground that a natural person did not intervene or did not control each of the operations performed by the systems nor the resulting contract.

Article 16. Obligations to Make Contractual Clauses Available Anyone who proposes by electronic means the supply of goods or the provision of services must make available the applicable contractual terms. In case of negotiation of all or part of the clauses of an electronic contract, the supplier of goods or service provider must communicate the new contractual terms that bind both parties.

Article 17. On the Validity of Acceptance of an Electronic Offer In the case of an electronic communication exchanged with the messaging system