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All segments of Russian electronic commerce have been on the rise lately
All segments of Russian electronic commerce - B2C Internet shopping centers, B2B corporate commerce sites, e-payment systems and B2G (electronic state procurement services) - have been on the rise lately. Online shops have become a good business, with the number of adult Internet users having reached 17 million people nationwide, or 15% of Russia's population, according to a recent poll conducted by the Public Opinion Foundation. As the number of Internet users grows, surfers get increasingly interested in buying goods and services online as people come to realize the benefits of buying online. According to the National Association for Electronic Commerce, e-commerce in Russia grew to $3.2 billion last year, which was 40% up year-on-year, with retail turnover of $662 million, in which B2B commerce accounts for $442 million, and prospects of up to $1 billion for 2005. The first Internet shop in the Russian domain opened as little as nine years ago, in 1996. In huge Internet supermarkets of today's Russia, one can buy almost everything online. Rambler's TopShop, an Internet commerce registry, has 4,433 URLs for e-commerce; Yandex Market has 1,684,145 various goods on offer - from stationery to rolled steel. Around 61% of Russian businesses use Internet to trade their goods and services. The Russian monitoring agency SpyLOG reported as at December 2004 that 8.6 million people visited Internet shopping centers each month. The more the business volume and number of transactions, the more money e-commerce earns, the more so that this area of business activity is not regulated by Russian legislation. The Russian parliament has been trying to adopt a law to regulate electronic commerce for five years now, but to no avail, for the want of legal definitions for electronic commerce, electronic transaction, or electronic flow of documents. Actually, Russian e-shops have the same rights and obligations as ordinary shops. In the latter case, the commerce is ruled, notably, by the Consumer Rights Law. Valery Komissarov, chairman of the State Duma Information Policy Committee, argues an electronic commerce law should be adopted as soon as possible. He told RIA Novosti that to adopt the law "as is" is better than to adopt no laws at all. "An electronic commerce law would build up electronic payments," he said. Currently, according to Anton Nikolsky, executive director of the Association for E-Commerce, as little as 5% of transactions in Russia are paid off electronically, which restricts Internet commerce. Mikhail Yakushev, head of the legal support department of the Russian Ministry for Telecommunications and Information Technologies, disagrees. He says the lack of regulation of e-commerce does not hinder this activity. "You cannot call all activity in a certain area illegal just because there is no law regulating it," he said. There are many other problems that hinder online commerce stronger than the want of legislation: persistent reluctance of customers and businesspeople to buy online; frequent fraudulent transactions, and counterfeit products. The latest fraud novelty on the Russian Internet is fishing - making double-ganger websites to sell fraudulent goods. Some, however, see it as just another proof of growing popularity of online commerce in Russia. Prospects for this market, largely defined by the success of B2C and B2B projects in Russian provinces, look rather optimistic as Yandex, a major Russian search engine, says the growth of the number of Internet users outside Moscow is faster than in the capital by 10%. Currently major web supermarkets run a nationwide delivery procedure for goods bought online via the federal mail.
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