Greetings, Ion. On 11 November, the Parliament of the Republic of Moldova voted for the first legislative package for the digitization of the Moldovan economy. In my opinion, this is a significant milestone that should be a major boost to business development. It all started with the 'Roadmap for boosting the digitization of the national economy and development of e-commerce', drawn up by the Economic Council under the Prime Minister***. So when did its development start?

In the last two years, we have been going through a very difficult epidemiological situation, which has affected all social and economic areas in the country. Economic operators have been hit hard by the consequences of COVID-19. Movement restrictions, remote working, etc. have made us realize that we are living in a new reality. Thus, last year the Ministry of Economy, together with the Economic Council and the support of development partners - EBRD, GIZ Moldova, USAID (through the Structural Reforms Program in Moldova) and IFC - developed the "Roadmap for boosting the digitization of the national economy and development of e-commerce". The document contains topics gathered from the business community, and they relate to the need to promote digitization processes of several processes G2B, B2B, B2C - or simply speaking - remote communication between state, citizen, and businessman.

This is a comprehensive subject, which impacts all spheres of contemporary life...

There are currently 80 topics in the document, compared to 37 originally included. Why do I say at this point - because the "Roadmap" is a "living" document or, put differently, Economic Council members can propose for inclusion in the document other topics that need to be addressed.

What are the main objectives of the Roadmap?

There are four major objectives:

1. Develop remote interaction and promote digital services for business;

2. Improving e-commerce and e-payments;

3. Improving customs procedures for online exports and boosting postal and courier services;

4. Strengthening and attracting national and international e-commerce platforms to the country.

We won't be able to cover all 80 topics, but we could highlight a few. Which ones are the most relevant?

These include reforms that are long overdue and yet overlooked. For example, one brave package of proposals is about creating the conditions for an unhindered market activity for non-bank payment operators. This would allow economic agents to access cheaper, more flexible, and more modern services when making cashless payments, which at the moment are at a disadvantage, unlike the technologically advanced states and contrary to consumer and merchant expectations. We need to improve the situation in Moldova in this area. 

Can we also expect a reduction in credit card processing fees?

This is a condition of fundamental importance. After all, the profitability of many businesses is such that every percentage of turnover is an extremely sensible value that affects the transition of a business into the online environment. Another long-awaited proposal by the business community concerns online access to the Register of Legal Entities in Moldova.

Today, economic agents who want to establish business relations with foreign investors have to go through a series of bureaucratic, costly, and exhausting processes to obtain from state institutions extracts from the State Register, which also has to be translated, authenticated, and apostilled. Abroad, this information is obtained through a secure portal containing open and truthful data about the company with which an investment partnership or other contractual relationship is being entered into. The same is wanted in Moldova to save time and resources.

What are the plans for e-commerce? It has undergone major growth during the quarantine, but I suspect the momentum has slowed down again...

To avoid any disruption, e-commerce legislation needs to be synchronized. At the moment, the E-Commerce Act and the Consumer Rights Protection Act treat certain subjects differently than the Civil Code or other more up-to-date legislation, which confuses operators in the sector.

Another block of proposals concerns the encouragement of e-commerce.

Today, both traders, retailers, and online traders are put on the same fiscal footing, although the rules of the game are different in all these segments. Experts propose creating conditions tailored to the specifics of business to support the development of e-commerce, which does not need certain elements such as cash-register machines or exhausting tax checks. Online traders could be exempted from providing proof of financial transactions, as the FISC can already track them electronically.

So what did the Parliament vote on November the 11th?

The first package to digitize the economy was voted in Parliament on the 11^th of November 2021. After drafting the first version of the "Roadmap", we prioritized tackling some of the problems alerted by the business community. A package of legislative changes has been drafted to allow:

- Remote registration of a company, modification of the incorporation or liquidation documents of a business;

- The possibility of using electronic signatures in employment relationships between employer and employee, including the signing of remote employment contracts;

- Unilateral recognition of qualified advanced electronic signatures issued in EU countries and the possibility to interact with Moldovan authorities remotely for European diaspora and investors;

- Possibility to obtain qualified advanced electronic signatures in Moldovan consulates abroad;

- Widespread use of electronic documents and consolidation for the benefit of the citizen of the provisions of the Law on electronic signature and electronic document;

- Introduction of electronic power of attorney in relations with public authorities;

- Obligation of public institutions, first of all, the Public Services Agency and the municipalities, to receive electronic documents and issue various documents (decisions, certificates, extracts, permits, etc.) in electronic format as a priority;

- Facilitate remote registration on the public procurement portal and subsequent e-procurement;

- The use of electronic documents in other areas of importance to business, including relations with public utility companies (gas, electricity, water/sewerage, communications, etc.);

- Eliminate notification and authorization as a personal data controller;

- Extend the binding forms of expression of consent of the citizen to the processing of personal data.

I would not want us to miss out on the important details from this list. I suggest we dwell on some issues - how, for example, will remote registration of a company be carried out?

At the moment, the legislative changes have yet to be published in the MO to enter into force, as the legislation contains several hurdles in the process of remote business registration. To make changes in the business incorporation documents, the entrepreneur has to physically go to the institutions. In the last two years, however, due to pandemic restrictions many entrepreneurs have been stranded abroad or quarantined, and not being able to make all the necessary changes remotely has severely limited their economic activity.

Parliament has passed changes to legislation that will allow entrepreneurs to open their businesses online. Moreover, the changes in the legislation will now also allow business people to make changes to their business incorporation documents online, and even to liquidate their business online.

Thus, the legislative changes will require the authorities to accept remote registration and liquidation of the business and to make changes in the incorporation documents using electronic signatures and electronic documents.

I also want to mention here that the authorities will now be obliged to issue documents in electronic format.

So it will be possible to go paperless?

Today, economic agents and individuals, although they have the right, according to the law on electronic signature and electronic document, not to physically come to state institutions to pick up or present documents requested on paper, this still takes place. As a solution, the draft law, voted by MEPs, foresees obliging public authorities to use electronic signatures and electronic documents in these processes, in parallel with the traditional method, for those who are not technologically ready.

Will this also apply to employment contracts?

The subject of digital contract signing arose during the pandemic period, when the relationship between employee and employer changed, with employers having to send their staff home and work with them remotely, etc.

All these changes in the employment relationship between employee and employer also imply changes in the employment contract. However, current legislation does not stipulate that contract changes can be made with an electronic signature. The employer is obliged to notify the employee under the signature of any change in the employment relationship, which is interpreted to mean that the employee must receive a document in duplicate which he must sign in holography, i.e. by hand. And this means that the man must physically come to work.

The document voted by MEPs gives economic agents and citizens the possibility to use electronic signatures in the establishment of employment relationships, if necessary, and to make it known by several methods that would confirm receipt of the information by the employee.

You mentioned qualified advanced electronic signatures for EU countries. What does it mean?

By voting on the first legislative package on digitization of the economy, the Republic of Moldova unilaterally recognizes EU e-signatures. Thus, after the entry into force of these changes, only EU-qualified advanced e-signatures will be acknowledged, which would allow existing investors to sign documents in Moldova and submit documents from EU countries that are no longer issued by the authorities on paper.

This will allow the enormous potential for attracting investment from the EU area to Moldova to be tapped and would reduce the constraints on foreign investors already operating in Moldova. Because Moldova does not accept electronic signatures from the EU, Moldova misses out on millions of euros of investment in one year alone, state authorities say.

What other issues are important in the adopted document?

Another important issue contained in the 1.0 package on digitization of the economy is that notification as a personal data controller will no longer be mandatory.

Such notification is required for any company processing personal data in an automated or manual system. This data refers to information about the consumer, employee, their salary, home address data, etc.

The spectrum of personal data is so broad that it is very difficult for Moldovan businesses to meet all the requirements of the National Centre for Personal Data Protection (CNPDCP) for obtaining the status of the personal data controller. Some entrepreneurs say that notification can take up to 7 months.

This has led to a situation where for 8 years, since the Law on Personal Data Protection has been in force, only about 3000 enterprises out of 240 thousand have passed the notification procedure as a personal data controller. I want to tell you that if the company operates with personal data and is not notified to the CNPDCP, it violates the law.

Another problem is also the fact that today the individual can only give written consent to the processing of his or her data with the application of a holographic signature or electronically with the application of a qualified advanced signature. This is a hindrance in the development of ICT solutions and remote interaction with the consumer. In the EU this problem has long been solved by diversifying the ways of expressing consent for processing personal data.

What else do we need to be aware of? What are the next steps for digitization in 2022?

The Council will continue focusing on identifying constraints for business and developing legislative measures to facilitate innovation in the Business-Government and Business-Consumer relationship. These two dimensions have a lot of room for modernization through digitization. In the immediate period ahead we focus on:

- digitization of certain aspects related to digital services in the notary;

- deepening remote interaction with tax authorities;

- removing barriers to e-Commerce from various outdated pieces of legislation and primarily from the customs code;

- stimulating e-payments and competition in this area to achieve more affordable services;

- developing the courier market and integrating e-Commerce elements into the postal sector throughout the country, etc.

And this requires new channels and means of communication, doesn't it?

We have already created a platform for dialogue with businesses on issues of digitization of the economy under the aegis of the Vice Prime Minister for Digitization - iConsult, and we have also developed a mobile app for the business community - BizRadar.

These two tools will contribute through new methods of interaction and communication with business to the modernization of the Republic of Moldova.

I have only one more request. Our interview inadvertently turned into a multi-page document, given the importance of the topic. Would you mind talking about these new means of communication, separately, in the near future?

*** The Economic Council attached to the Prime Minister was established as an advisory body by Government Decision No 631 of 22.08.2011.

Its task is to ensure a dialogue between the business community, the donor community, and the state to develop a sound, non-discriminatory, transparent, and investment-friendly socio-economic and business environment.

Pavel Zingan