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Isle of Man: E-Commerce

Electronic Transactions Act 2000

This page was last updated on 31 January 2020.

The Isle of Man Electronic Transactions Act, which went into force in November 2000, is based on Australian legislation, which is in turn based on the model issued by the United Nations Commission on International Trade Law. Its purpose is to enable electronic commerce to be put on the same legal footing as paper-based commerce, as well as removing any legal impediments to the use of electronic communications with public authorities.

The Act ensures equality of electronic transactions with paper ones, subject to precautions to ensure that electronic communications are authentic and accessible, and is technology neutral. As a general rule, electronic communications are treated as being sent from the originator's place of business and received at the recipient's place of business. It incorporates the common law principle that a communication which appears to be from a person can only be treated as such if it was sent with their authority.

Electronic signatures are given parity with written ones, and there is provision for a system of certification service providers to verify the authenticity of communications.

Internet service providers and telecommunications operators are not required to monitor the content of communications, and will not be liable for such communications provided they take appropriate action when they are brought to their attention.

Regulations have been issued under the Act, containing the following main points. Regulation 1 sets out the title of the Regulations and when they come into operation.

Regulation 2 specifies transactions which are excluded from the operation of Section 1 (1) of the Act (which provides that, in general, a transaction is not invalid merely because it takes place wholly or partly by means of one or more electronic communications). This is an essential provision because there are certain transactions, wills, mortgages etc. where, for the foreseeable future, it is not possible or practical to transact them by electronic means. Such transactions will still have to be effected in accordance with existing formal requirements (usually, that they must be in writing).

Regulation 3 excludes Section 2 of the Act (which makes provision for the time and place of despatch and receipt of electronic communications) in the case of value added tax (VAT).

This is necessary to avoid a potential conflict with Customs and Excise rules concerning the place where a transaction is treated as taking place for VAT and other purposes.

Although the Isle of Man is within the European Union in some respects, applies its Common External Tariff, and imposes EU VAT in common with the UK, it does not partake of much other EU legislation, and will not need to implement the EU's or the UK's e-commerce legislation, which is notably more restrictive than the act passed by Tynwald.



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