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EDI and American Law: A Practical Guide.

Author: Benjamin Wright Publisher: TDCC: Electronic Data Interchange Association, 225 Reinekers Lane, Suite 550, Alexandria, VA 22314; 1989, 140 pages, softback: $69.95 Reviewer: Michael W. Beasley; Attorney specializing in physical security, national security law, and international business; Member of ASIS

Electronic data interchange (EDI) could expedite commercial transactions the way word processing has modernized and enhanced written communications. Indeed, in the 20 years since EDI'S introduction, millions of transactions have been accomplished by transmitting electronic data through computer networks.

Wright has performed a solid service for businesses that use EDI and those thinking of adopting this rapid and accurate means of commercial trade and information exchange. EDI and American Law: A Practical Guide effectively examines the myriad complex legal implications of EDI while describing fundamental terms and uses of this expanding technology.

The legal issues surrounding EDI are based on machine-generated and machine-readable data and the fact that such data does not easily fit into traditional legal concepts. Rather than standard English language free text, EDI uses computer language based on commonly used or specially designed software programs agreed on by the EDI system trading partners. Electronic information exchange may result in agreements and contracts between trading partners, but the form of agreement is unfamiliar when referring to common legal guides such as the Uniform Commercial Code (UCC).

Wright notes the expanding uses of EDI for documents such as commercial purchase orders, freight forwarding and insurance commitments, letters of credit, invoices, payments, and government regulatory compliance filings. Each use involves peculiar applications of the law, and the use of EDI creates unique issues in complying with legal requirements.

The primary considerations Wright analyzes include whether EDI transmissions constitute the "writing" required for certain types of commercial transactions under the UCC and whether verification of transmissions by methods such as sender identification codes constitutes a "signature" on agreements concluded through EDI.

Wright cites no specific court cases adjudicating these issues. He hypothesizes, however, that the flexibility of commercial legal authorities such as the UCC will permit courts to conclude logically that requirements for both a written document and a signature can be met through EDI transmissions and electronic record-keeping procedures.

More importantly, Wright suggests ways to craft EDI trading partner agreements that anticipate critical legal requirements and stipulate provisions for common definitions, interpretation of terms, and resolution of disputes. Thus, EDI users may avoid costly and prolonged litigation by putting effective agreements in place before disputes arise.

The author also discusses legal issues regarding EDI network agreements between EDI users and third-party networks. Users must ensure that such agreements protect the trading partners' legal rights and provide for satisfactory audit trails in transmitting and recording commercial information.

Wright also covers similarities in legal concerns between EDI and electronic funds transfer systems, record keeping laws and their relevance to EDI, and potential EDI antitrust implications. In each instance, Wright focuses on the law's practical impact and provides pragmatic approaches to address the legal issues.

Sponsored by the publisher, the Electronic Data Interchange Association, Wright has created a handy guide for identifying and analyzing EDI-associated legal issues useful to attorneys, businesspersons, and corporate general counsel.

At the same time, EDI and American Law: A Practical Guide introduces EDI technology, terms, and applications and is invaluable as a basic primer or desktop reference for EDI users. Given the current dearth of material on this topic, Wright's efforts are commendable. As promised in the title, it's practical. For a legal reference, that combination is alto ether too rare.
COPYRIGHT 1990 American Society for Industrial Security
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1990 Gale, Cengage Learning. All rights reserved.

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Author:Beasley, Michael W.
Publication:Security Management
Article Type:Book Review
Date:May 1, 1990
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