Clinton To Oppose Regulating Internet Commerce

After a two-year study into the growing world of Internet commerce, the Clinton administration has decided not to call for new taxes or regulations on business conducted over the global computer network and instead will largely allow the private sector to determine how it will operate in cyberspace.

The administration’s stance, detailed in a report scheduled to be released by President Clinton on Tuesday, is a marked departure from the federal government’s practice of closely regulating other electronic networks, such as telephones, television and radio.

Administration officials and technology industry leaders contend that new laws and taxes could stymie development of electronic commerce, which, if left loosely regulated, is expected to reach $200 billion in the United States by the year 2000, according to industry analysts.

“Commerce on the Internet could total tens of billions of dollars by the turn of the century,” said the report’s final draft. “For this potential to be realized fully, governments must adopt a non-regulatory, market-oriented approach.”

Industry leaders who have seen draft versions of the report commended the administration’s approach, saying that businesses need the incentive of regulatory freedom to embrace electronic commerce, a step many corporations recently have been taking with trepidation. Consumers, too, have been cautious about making purchases online.

The report also highlights a stark shift in the administration’s policy toward adult material on the Internet after last week’s Supreme Court decision striking down as unconstitutional a federal law that would have criminalized transmission of “indecent” material to minors over computer networks.

Although the administration had supported the law, it is now asking the industry to police itself through a ratings system, and advocating the use of software that lets parents block children’s access to objectionable Internet content.