Internet banking is a potential legal nightmare. "There can be as many as 200 legal systems with which any one internet banking transaction may have to comply, most jurisdictions don't recognize on-line contract formation and internet retail banking could cost your bank billions in customer claims," says Mark Lewis, partner at Arnheim Tite & Lewis, PricewaterhouseCoopers' UK correspondent law firm.
Lewis adds: "Your UK internet banking transactions will need to comply with the Banking Act 1987 and regulations made under it such as the Banking Act (Advertisement) Regulations 1988, as well as the Financial Services Act 1986 and the regulations made under it, the Consumer Credit Act 1974 and the regulations made under it, the Code of Conduct for the Advertising of Interest-Bearing Accounts, the Banking Code of Practice, the Unfair Contract Terms Act 1977, the Unfair Terms in Consumer Contracts Regulations 1994, the UK law implementing the proposed Directive on Distance Marketing of Financial Services and the proposed Directive on Certain Legal Aspects of Electronic Commerce in the Internal Market - and that's just in the UK."
Despite the difficulties, Lewis remains bullish. "Banks operate in a highly regulated market, but e-business is happening anyway.