Territoriality and the Governance of Cyberspace

Stephen J Kobrin
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Stephen J Kobrin: University of Pennsylvania

Journal of International Business Studies, 2001, vol. 32, issue 4, 687-704

Abstract: The issue of how to regulate transactions in cyberspace is central to the future of international electronic commerce. This paper is based on four assumptions: (1) the Internet and e-commerce cannot exist apart from the social order; (2) attempts to regulate and tax activities on the Internet through existing territorial jurisdiction will be problematic; (3) cyberspace and e-commerce are inherently international, thus any successful governance regime will involve significant and substantial international cooperation; and (4) effective governance of cyberspace will require public-private sector cooperation, i.e., hybrid or integrative schemes combining self-regulation with government oversight and enforcement capabilities. The paper discusses the first three of these assumptions, then explores taxation in more detail as a case study that typifies the issues raised by e-commerce in a global context. Next, I develop a framework for understanding the governance of cyberspace as an evolving process involving growing formalization and an increase in the number of actors involved over time. The paper concludes with a discussion of several issues that require further research.© 2001 JIBS. Journal of International Business Studies (2001) 32, 687–704

Date: 2001
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