This week, the government of Mexico officially acknowledged the viability of e-commerce in the country by passing legislation that recognizes Internet purchase orders as binding contracts.
Previously, all contractual agreements in Mexico required a physical signature. The new reforms to Mexico’s civil and commercial codes validate “electronic signatures” used for Internet orders.
The new law, passed by Mexico’s lower house of Congress, requires that all electronic transactions comply with existing commerce and advertising standards. The law also says that copies of documents related to online transactions must be kept for at least 10 years, and that all consumer data submitted electronically be kept confidential.
The adoption of the bill has much to do with the government’s recognition of the importance of e-commerce to the future of Mexican economic stability.
Until now, e-commerce has been sluggish in Mexico. In the consumer sector, only about 1.5 to 2 million Mexicans actually use the Internet, and even fewer have their own accounts. Forty million people in Mexico live in poverty, out of a total population of 98 million.
The Mexican government estimates that 70 percent of electronic commerce in the country involves business-to-business (B2B) transactions. Some industries are thriving in the country, and beginning to recognize the critical importance of e-commerce.
Earlier this month, Cemex, the world’s third largest cement maker, based in Monterrey, Mexico, announced a $50 million (US$) investment in a new venture for Internet projects, to be known as PuntoCom Holdings.
Based in Miami, Florida, the firm’s operations will extend to Mexico, Brazil and Argentina.
Big Blue Sees Potential
Meanwhile, industry heavyweights in the United States have begun to set their sites south of the border.
Alfredo Capote Sanchez, president of IBM Mexico, said last month, “Electronic trade in Mexico might reach $2 billion in 2003, of which $600 million will be consumer trade and the rest business to business.”
Sanchez estimated that last year’s business-to-consumer trade in Mexico reached $50 million while B2B transactions amounted to several hundreds of millions. Sanchez expects free access to the Internet to spur a boom in consumer use, estimating by 2004 that 60 million Mexicans will be connected to the Web.
Other Firms See Opportunities
In addition to IBM, Japanese power broker Softbank Corp. earlier this year formed a $100 million investment fund for online properties in Latin America which will include ventures in Mexico.
Just last week, Forrester Research issued a prediction that e-commerce trading in Mexico will reach $107 billion by 2004, with strong showings in automotive, electronics and petrochemicals.