The government is proposing two new laws to legalise electronic transactions for both government and commerce and strengthen security, a senior official said today.

One law would provide for e-government transactions by legalising documents online and ensuring a higher level of security, said energy, communications and multimedia ministry parliamentary secretary Chai Kwang Chye.

The other would provide for commercial electronic transactions.

"The government is serious in encouraging commerce (and) electronic transactions, online usage and online activities," Chye said.

Plans for the new laws were the result of a government study launched in 2000 to harmonise various laws and statutes to enable electronic transactions.

The legislation, expected to be put before parliament next year, would "enhance online transactions by ensuring their security and legality," he said.

"We found that some of the existing statutes actually impede electronic activities, sometimes price protection, some relating to consumer rights, and we find that some laws need to be fine-tuned."

Lifting confidence level

It was important that users "feel more confident with the integrity of the system" and that documents transacted, especially those relating to government, are legal.

Malaysia has an Internet penetration rate of about 10 percent of its 23 million population, and has set a target of 25 percent by the year 2005.

Although the number of Internet subscribers is just 2.1 million, the government estimates there is a total of seven million users.

The ministry says about a third of all local Internet users made online transactions last year, and it hopes that by the end of this year the figure will have risen to 50 percent.