MODULE 3:

BUSINESS CONCEPTS AND SOCIAL ISSUES

In this Module
Lesson 3.1: Ethical, Social, and Political Issues in E-Commerce
Lesson 3.2: Online Retail and Services
Lesson 3.3: Online Content and Media

Module Overview
Good day everyone! Welcome to Module 3. Internet technology and its use in e-commerce disrupts existing
social and business relationships and understandings. Suddenly, individuals, business firms, and political
institutions are confronted by new possibilities of behavior for which understandings, laws, and rules of
acceptable behavior have not yet been developed. Many business firms and individuals are benefiting from the
commercial development of the Internet, but this development also has costs for individuals, organizations, and
societies.

Module Objectives/Outcomes

At the end of the lesson/module, students are able to:

• Examine the ethical, social, political, and legal issues raised by e-commerce, assess strategies for
protecting consumers, sellers, and intellectual property, and propose responsible real-world solutions.
• Analyze the current online retail sector operation and analyze the current trends in online travel and
career services industry.
• Examine media and online content consumption, explain the concept of media convergence and
challenge, and analyze the key factors of online entertainment industry.

Are you ready? Enjoy Module 3.

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 Module 3
Lesson 3.1: Ethical, Social, and Political Issues in E-commerce

Learning Outcomes:

• Examine the ethical, social, political, and legal issues raised by e-commerce, assess strategies for
protecting consumers, sellers, and intellectual property, and propose responsible real-world solutions.

Time Frame: 6 hours

Introduction:

Welcome to Lesson 3.1 where E-commerce have changed how businesses, consumers, and governments interact.
While they offer opportunities for growth and innovation, they also bring challenges like privacy concerns,
intellectual property violations, online fraud, and consumer protection issues. These technologies benefit many but
also create risks that require careful ethical reasoning and responsible decision-making, especially where rules and
laws are not yet fully established.

Design an Ethical E-Commerce Platform for the Philippines

Instructions:
Imagine you are launching a new e-commerce platform in the Philippines. Using what you have learned about
ethical, social, and political issues, create a detailed proposal for your platform that addresses privacy,
intellectual property, consumer protection, and fraud prevention. Your proposal should include:

Platform Overview – Name, target market, and products/services offered.

Ethical Guidelines – Rules and practices to ensure responsible handling of personal data, intellectual property,
and customer interactions.
Legal Compliance – How the platform will comply with Philippine laws such as the Data Privacy Act,
Electronic Commerce Act, and Cybercrime Prevention Act.
Fraud Prevention Measures – Steps to protect both consumers and sellers from scams and fraudulent
activities.
Innovative Feature – Introduce at least one creative technological or business feature that enhances ethical
operations or protects users online.

Deliverable: A 1–2 page written proposal, or a visual infographic that clearly communicates your platform’s
ethical and legal framework.

Rubrics:
Criteria Excellent (5) Proficient (4) Developing (3) Beginning (2)
Platform Clear, realistic platform Clear platform with Basic idea, limited Unclear or
Overview aligned with PH market minor gaps relevance unrealistic
Ethical Issue Strong analysis of privacy, Issues identified with Issues listed, little Issues unclear or
Analysis IP, and consumer issues explanation analysis missing
Legal Correct and applied PH laws Laws cited, generally Laws mentioned, Laws missing or
Compliance applied weak application incorrect
Fraud Well-analyzed risks and Risks identified with Limited risks or No clear
Prevention solutions solutions solutions prevention
Innovative Creative, ethical, and well- Useful and relevant Basic or weak feature Unclear or
Feature justified feature irrelevant
Stakeholder Clear analysis of multiple Stakeholders Limited stakeholder No stakeholder
Impact stakeholders identified view analysis
Organization & Clear, logical, professional Mostly clear Some confusion Poorly organized
Clarity

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 Identify five ethical or legal issues in e-commerce from real-life online business situations.

Instructions:

• Think of actual online transactions, e-commerce websites, or social media selling platforms you have
seen or used.
• Write down five examples of ethical or legal issues, such as:
• A seller copying and selling software without permission (copyright infringement).
• A website collecting personal data without asking (privacy violation).
• Fake online stores taking payment but not delivering products (fraud).
• Customers leaving false reviews to harm a business (cyberbashing).
• Unauthorized sharing of a product’s digital content (file sharing/piracy).
• Relate each example briefly to how it affects buyers, sellers, or the business environment.

Rubrics:
Criteria Excellent (5) Proficient (4) Developing (3) Beginning (2)
Issue Identification Real, clear, relevant cases Clear but generic Vague Incorrect or
examples unclear
Ethical/Legal Correctly identified issue Mostly correct Partially Incorrect
Accuracy correct
Real-Life Context Clearly based on actual Some real-life link Weak context No real context
platforms
Impact Analysis Clear effect on Some impact Limited impact No impact
buyers/sellers explained explained
Clarity & Very clear and concise Mostly clear Wordy or Poorly written
Conciseness unclear

UNDERSTANDING ETHICAL, SOCIAL, AND POLITICAL ISSUES IN E-COMMERCE

We live in a society where information and knowledge are major sources of power and wealth. Disputes
about information often involve control, influence, and other valuable interests. Like earlier technologies such
as television, telephone, electricity, the Web, and the Internet, e-commerce can promote social development,
and in many cases it has done so. However, these same technologies can also be for harmful activities such as
crimes, attack people, damage the environment, and undermine core social values. Before the Internet existed,
cybercrime was minimal. While businesses and individuals benefit from the growth of the Internet, this progress
also brings costs to people, organizations, and society. These advantages and disadvantages must be carefully
evaluated when making ethical and socially responsible decisions, especially in situations where clear legal or
cultural rules are still lacking (Laudon & Traver, 2021 pg. 540-541).

The main ethical, social, and political issues related to e-commerce can be grouped into four key dimensions
(Laudon & Traver, 2023, pg. 460-522):

Information Rights – What rights do individuals have over their personal data in public spaces or at
home when Internet technologies allow widespread and efficient data collection? What access rights do
people have to information about companies and organizations?
Property Rights – How can existing intellectual property rights be enforced in an online environment
where exact copies of protected works can be created and shared globally within seconds?
Governance – Should the Internet and e-commerce be regulated by public laws? If so, which authorities
should govern them—local, national, or international bodies?
Public Safety and Welfare – What actions are needed to provide fair access to the Internet and e-
commerce platforms? Should governments ensure Internet access for schools and colleges? Do certain

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 online activities, such as false information, online gambling, or anonymous hateful speech, pose risks
to public safety and welfare?

Ethical and Legal Issues in E-commerce

Many ethical issues in e-commerce and Internet use are closely linked to legal issues. These concerns
are usually classified into (Bass, 2021, pg. 259):

Intellectual Property rights – Information and intellectual property have ownership and value, but
protecting them online is difficult, leading business owners to significant financial losses from piracy.
Privacy – Protecting personal privacy online is challenging, some countries have minimal privacy
regulations, while others enforce strict protection laws.
Free speech vs censorship – Online freedom of expression can lead to offensive or harmful content
against individuals and organizations, which has caused some countries to restrict Internet materials.
Consumer and merchant protection against fraud – For e-commerce businesses to succeed, they
must protect all transactions and users from fraud.

Basic Ethical Concepts

Ethics means acting according to what society considers right or wrong. In e-commerce, it includes
handling privacy, ownership, control, and security properly (Bass, 2021, pg. 257).
Applying ethics to businesses or societies can be challenging but possible. As long as there is a decision-
maker made by an individual or bodies, like CEOs, boards, or governments, can be evaluated using ethical
principles.
There are four basic ethical concepts (Laudon & Traver, 2023, pg. 460-522):

Responsibility - This means that individuals, organizations, and societies, as free moral agents, are
responsible for their actions.
Accountability - It means individuals, organizations, and societies must take responsibility to others
for the outcomes of their actions.
Liability – It is a feature found in political systems in which the law allows individual to recover
damages and losses caused by other individual, system, or organizations.
Due process – It is an aspect in law-governed societies where laws are clear and understood, and people
can appeal to higher authorities to make sure they are applied correctly.
Ethical, social, and political issues often appear as dilemmas. A dilemma is a situation with at least two
opposing actions, each leading to a desirable result. When facing a situation that appears to be an ethical
dilemma, how can you analyze and reason through such an ethical dilemma?

Here is a five-step process that can guide you (Laudon & Traver, 2023, pg. 460-522):

1. Identify and clearly describe the facts - Determine who did what to whom, and when, where, and how
it happened. In many circumstances, initial facts are incorrect, and simply clarifying them can help
solve the problem. It also helps if all parties involved in the ethical dilemma agree on the facts.
2. Define the conflict or dilemma and identify the higher-order values involved - Ethical, social, and
political issues involve higher values; without them, there would be no debate. Those involved in a
dispute usually claim to uphold values like freedom, privacy, property protection, and free enterprise.
3. Identify the stakeholders - All ethical, social, and political issues have stakeholders—people or groups
who have interest in the outcome, who are involved in the situation, and often have strong opinions.
Identify who they are and what they want, as this will help when creating a solution.
4. Identify the options that you can reasonably take - You may find that no option meets all interests
involved, but some options are better than others. A good ethical solution doesn’t always mean
balancing all consequences for stakeholders.
5. Identify the potential consequences of your options - Some options may be ethically right but causes
problem from a different situation. Other options might work now but fail in similar situations later.
Always ask, ‘What if I consistently make this choice?’”

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 After analyzing the situation, you can use these established ethical principles to guide your decision.

Examples of issues that violate intellectual property rights (Bass, 2021, pg. 261-265)

Recording Movies, Shows, and Other Events - A common way to violate intellectual property is
recording movies in theaters using cameras or video-enabled phones. Companies like PirateEye make
devices that detect such recording devices and monitor them in real time.
Copyright Infringement and Protection – Many major lawsuits have been filed over online copyright
infringement in e-commerce. Copyright gives the creator the exclusive legal right to publish, sell,
license, distribute, or use their work as they wish.
File Sharing - One major way people violate copyrights is through sharing files without permission.
Globalization – A lot of media piracy happens in countries like Russia, China, and Sweden (as seen in
the Pirate Bay case), making it hard to regulate. Doctorow notes that most piracy occurs in developing
countries.
Fan and Hate Sites – “Fan and hate websites are part of internet self-publishing and user-generated
content like blogs. Fan sites can violate intellectual property by posting movies or shows without
permission, even before official sites launch. Courts can shut them down, but new ones may appear
quickly. On the other hand, Hate sites spread negative comments about companies or individuals, often
targeting large corporations like Walmart, Nike, or Microsoft.”
Cyberbashing – Cyberbashing is linked to hate sites and involves registering a domain name to
criticize—often maliciously—an organization, product, or person.

Other Legal Issues in E-Commerce (Bass, 2021, pg. 269)

E-Discovery - is the process of locating electronic data like text, images, or videos using computer
systems. It is often used to find evidence in legal cases and frequently involves email archives, which are
the main target of e-discovery requests. Key features of e-discovery include full content index, keyword
search, and metadata index.
Cyberbullying - is bullying that occurs through electronic technology (e.g cellphones, computers, and
tablets, and communication tools such as social media, text messages, chat, and websites).

Smartphones and the Internet are central to social, political, and business life. In the growing online
marketplace, these technologies track human behavior in ways never seen before. The large amount of personal
information collected by online merchants is unprecedented, and laws to protect it are weak. As a result,
consumers often feel and indeed have lost control over their personal data.

These are some major types of ethical, social, and political issues in e-commerce (Laudon & Traver, 2023, pg.
460-522):

Privacy - is the moral right of individuals to be free from surveillance or interference by others, including the
government. It supports freedom, allowing people to think, write, plan, and associate without fear. Without
privacy, social and political freedoms, like freedom of expression, are weakened and destroyed, and
democracy in the society cannot exist without privacy.

Information Rights - It is a part of privacy based on four main principles:

1. Individuals have a moral right to control how their personal information is used, even if it was
collected with or without their consent. They should be able to edit, delete, and manage how
governments and businesses handle their online data.
2. Individuals have a moral right to know when their information is being collected and must give
their consent beforehand. This principle is called ‘informed consent,’ assumes people are rational
and can decide for themselves whether to provide their information in exchange for a benefit.
3. Individuals have a right to due process for their personal information. Collecting, sharing, and
using personal data must be fair and transparent. Information systems—public or private—should

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 be open, follow published rules explaining how data is used, and allow people to edit, correct, or
manage their personal information.
4. Individuals have the right to have their personal information kept secure. Systems must protect
data from hacking, intrusion, or unauthorized use. While privacy and security are not the same,
they are connected—without security, privacy cannot exist.

Public Sector Privacy: Technological Ways to Protect Privacy Online

Third-party cookies, which send information to external servers, are the main tools for online tracking
and surveillance on the website, no matter where they are stored. Privacy is also at risk from IP trackers, which
log IP addresses and can identify users as they browse in the internet when combined with other data. Effective
solutions to protect privacy must block third-party cookies and hide users’ IP addresses (Laudon & Traver,
2023, pg. 460-522).
Several technological solutions have been created to address privacy invasions on the Web and mobile
platforms. Table 1 shows some common tools for reducing or preventing online tracking and other privacy
threats.

Table 1. TECHNOLOGICAL PROTECTIONS FOR ONLINE PRIVACY

TECHNOLOGY PRODUCTS PROTECTION
Intelligent Tracking Prevention Apple Safari, Privacy Badger Monitors and disables tracking
(ITP) cookies
Differential privacy software Apple Reduces the ability to merge
different files and de-anonymize
consumer data
Privacy default browser Epic, Ghostery, Cliqz Eliminates tracking cookies and
prevents IP tracking using a VPN
Message encryption Signal, Gdata, Whisper, Apps that encrypt text and other
Telegram, Ceerus data transferred using
smartphones
Spyware blockers Spyware Doctor, ZoneAlarm, Detects and removes spyware,
Ad-Aware, and Spybot adware, keyloggers, and other
malware
Pop-up and Ad blockers Most browsers; add-on Prevents calls to ad servers;
programs: Adblock Plus, restricts downloading of images
PopupMaster at user request
Secure e-mail ZL Technologies, SafeMess, E-mail and document encryption
Hushmail, Pretty Good Privacy
(PGP)
Anonymous remailers Jack B. Nymble, Java Send e-mail without trace
Anonymous Proxy, Mixmaster
Anonymous surfing Freedom Websecure, Surf without a trace using VPN
[Link], Tor, networks
GhostSurfSurf
Cookie managers Cookie Monster and most Blocks third-party cookies
browsers
Public key encryption PGP Desktop Program that encrypts your mail
and documents

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Online Fraud Protection for Consumers and Sellers (Brass, 2021, pg. 270-271-272-273-274)

Consumer Protection

Consumer Buyer Protection - Consumer protection is essential for the success of any commerce, especially
in e-commerce, where buyers and sellers do not interact in person.
Third Party Assurance Services - Many public agencies and private companies also work to protect
consumers. Here are some examples:
• Protection by a Third-Party Intermediary - Intermediaries that run online marketplaces work to
protect both buyers and sellers. A good example is eBay, which offers comprehensive protection
through its Money Back Guarantee and Dispute Resolution Center.
• TRUSTs’s “Trustmark” - TRUSTe is a for-profit company that helps businesses follow best practices
when collecting and using personal information on their websites. Displaying the TRUSTe Trustmark
(a quality seal) boosts consumer confidence online and shows that the site follows responsible data
collection guidelines.
• Web Trust Seal and Others - The WebTrust Seal program is similar to TRUSTe and is sponsored by
the American Institute of Certified Public Accountants.
• Evaluation by Consumers - Many websites feature product and vendor reviews provided by
consumers.

Seller Protection

The Internet makes it easier for buyers and sellers in e-commerce to commit fraud. Sellers need protection
against:
• Customers who claim they did not place an order.
• Customers who illegally copy and sell copyrighted software.
• Customers who provide fake payment information, such as false credit cards or bad checks, for products
or services.
• Imposters who pose as another seller.
• Other sellers who use a seller’s name, trademarks, or website (or similar) without permission.
• Payment fraud committed by consumers or criminals. Sellers may also face illegal or unethical attacks
from competitors.

What can sellers do?

Some possible solutions are:

• Use smart software to spot suspicious customers, or do this manually in smaller companies. For
example, compare the credit card billing address with the shipping address
• Look for warning signs, such as red flags, that may indicate fraudulent transactions.
• Require customers whose billing and shipping addresses differ to contact their bank and add the
alternate address. Ship items only after this is verified.
• Ask customers to provide the credit card verification code.
• Delay shipping until payment has been received.

Intellectual Property Rights in E-commerce

Intellectual property (IP) refers to the property that comes from an individual’s creative work, like
literary or artistic creations. It represents ownership of intangible assets such as ideas, inventions, and other
creative works. IP is protected by patents, copyrights, trademarks, and trade secret laws. Intellectual property
law also regulates products of the mind, affecting areas such as visual and performing arts, electronic databases,
advertising, and video games (Bass, 2021, pg. 261-265). In Table 2 shows the Intellectual property laws and the
protections of intellectual property.

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Table 2. Intellectual Property Laws and Protection
Laws Protection provided by law
Intellectual property law Protects the creative work of people
Patent law Protects inventions and discoveries
Copyright law Protects original works of authorship, such as music and literary works,
artistic design, and writing computer codes.
Trademark law Protects trademarks, logos, etc
Trade secret law Protects propriety business information
Law of licensing Enables owners of intellectual property to share it via licensing.
Law of unfair competition Protect against those who use illegal or unfair methods, or methods not
relating to counterfeiting available to others. Also against those pirating intellectual property.
and piracy

Laws Governing E-Commerce in the Philippines

1. Republic Act No. 8792 — Electronic Commerce Act of 2000

The Electronic Commerce Act of 2000 is the law that provides legal recognition and a regulatory
framework for electronic data messages, electronic documents, and digital signatures in both
commercial and non-commercial activities. It facilitates the use of electronic transactions, making
digital contracts and communications legally valid and enforceable, while also prescribing penalties for
their unlawful use.
2. Republic Act No. 11967 — Internet Transactions Act of 2023
The Internet Transactions Act of 2023 is a law designed to regulate and promote trust in electronic
commerce by protecting the rights of online consumers and merchants. It applies to internet transactions
where at least one party is in the Philippines and sets rules for digital platforms, e-marketplaces, and
online merchants, including requirements for consumer protection, data privacy, transparency, and fair
competition.
3. Republic Act No. 10175 — Cybercrime Prevention Act of 2012
The Cybercrime Prevention Act of 2012 is the law that defines and penalizes crimes committed
through computers and the internet, including illegal access, identity theft, cybersquatting, and other
cyber offenses, strengthening legal protection against harmful online activities.

Other Related Laws

1. Republic Act No. 10173 — Data Privacy Act of 2012

The Data Privacy Act of 2012 protects the fundamental right to privacy by regulating the collection,
use, and security of personal information in both government and private systems, and establishes the
National Privacy Commission to enforce its provisions.
2. Republic Act No. 7394 — Consumer Act of the Philippines
The Consumer Act of the Philippines protects consumer rights by setting standards for fair business
practices, ensuring truthful information is provided to buyers, and safeguarding consumers against
unsafe, unfair, or deceptive sales acts.

E-Commerce Ethics & Legal Debate Challenge

Apply ethical reasoning, legal understanding, and strategic decision-making to solve real-world e-commerce
dilemmas.
Divide the Class into Teams: Each team receives a unique e-commerce dilemma scenario (examples below).
Scenario Examples:
• A customer shares your digital product illegally on social media.
• A competitor posts false negative reviews about your online store.

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 • Your website experiences a data breach, risking customer information.
• You find that a popular influencer uses your designs without permission.

Task Steps: (20 minutes)

a. Analyze the Scenario: Identify the ethical, social, and legal issues.
b. Propose Solutions: Each team develops 2 possible solutions.
c. Evaluate Consequences: Predict the short-term and long-term effects of each solution.
d. Select the Best Action: Decide which solution is most ethical and legally compliant.

Debate & Defense: (15 minutes)

1. Each team presents their recommended solution.
2. Other teams act as challengers and ask critical questions about the ethics, legal issues, and
consequences.
3. Teams must defend their choices using ethical principles and relevant laws (e.g., intellectual property
rights, data privacy, consumer protection).

Rubrics:
Criteria 5– Excellent 4 – Proficient 3 – Satisfactory 2 – Needs
Improvement
IdentificationIdentifies all ethical, Identifies most Identifies some Fails to identify
of Issues legal, and social issues issues correctly. issues. key issues.
accurately.
Proposed Offers creative, Offers mostly Offers limited Solutions
Solutions practical, and ethical practical and ethical solutions; partial missing or
solutions. solutions. ethical alignment. unrealistic.
Evaluation of Clearly predicts short- Predicts most Predicts limited Fails to predict
Consequences and long-term effects consequences; consequences; few consequences.
for all stakeholders. considers some stakeholders
stakeholders. considered.
Defense & Provides strong, Provides logical Defense weak; Defense missing
Justification logical defense using defense with some minimal reference to or illogical.
laws and ethical references to laws/ethics.
principles. laws/ethics.
Teamwork & Excellent teamwork; Good teamwork; Adequate teamwork; Poor teamwork;
Presentation organized and mostly organized; somewhat organized; disorganized;
engaging. moderately minimally engaging. fails to engage.
engaging.

Design an Ethical E-Commerce Platform for the Philippines

Imagine you are launching a new e-commerce platform in the Philippines. Using what you have learned about
ethical, social, and political issues, create a detailed proposal for your platform that addresses privacy,
intellectual property, consumer protection, and fraud prevention. Your proposal should include:

Platform Overview – Name, target market, and products/services offered.

Ethical Guidelines – Rules and practices to ensure responsible handling of personal data, intellectual property,
and customer interactions.
Legal Compliance – How the platform will comply with Philippine laws such as the Data Privacy Act,
Electronic Commerce Act, and Cybercrime Prevention Act.
Fraud Prevention Measures – Steps to protect both consumers and sellers from scams and fraudulent activities.

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Innovative Feature – Introduce at least one creative technological or business feature that enhances ethical
operations or protects users online.

Deliverable: A 1–2 page written proposal, or a visual infographic that clearly communicates your platform’s
ethical and legal framework.
Rubrics:
Criteria Excellent (5) Proficient (4) Developing (3) Beginning (2)
Platform Clear, realistic platform Clear platform Basic idea, limited Unclear or
Overview aligned with PH market with minor gaps relevance unrealistic
Ethical Issue Strong analysis of Issues identified Issues listed, little Issues unclear
Analysis privacy, IP, and with explanation analysis or missing
consumer issues
Legal Correct and applied PH Laws cited, Laws mentioned, Laws missing
Compliance laws generally applied weak application or incorrect
Fraud Well-analyzed risks and Risks identified Limited risks or No clear
Prevention solutions with solutions solutions prevention
Innovative Creative, ethical, and Useful and relevant Basic or weak Unclear or
Feature well-justified feature feature irrelevant
Stakeholder Clear analysis of Stakeholders Limited No stakeholder
Impact multiple stakeholders identified stakeholder view analysis
Organization & Clear, logical, Mostly clear Some confusion Poorly
Clarity professional organized

Closure

Congratulations! You have just finished Lesson 3.1. You are now ready for the next lesson

MODULE SUMMARY

In this module, you have learned the following:

ü The ethical, social, and political issues that arise from the growth of e-commerce and the increasing
power of information and digital technologies.
ü The four key dimensions of ethical and social issues in e-commerce: information rights, property rights,
governance, and public safety and welfare.
ü The close relationship between ethical issues and legal concerns in e-commerce, particularly in
intellectual property, privacy, free speech, and protection against fraud.
ü The basic ethical concepts of responsibility, accountability, liability, and due process, and how they
apply to individuals, organizations, and governments in e-commerce.
ü A five-step process for analyzing and resolving ethical dilemmas in e-commerce situations.
ü Common violations of intellectual property rights, including piracy, copyright infringement, file
sharing, fan and hate sites, and cyberbashing.
ü Other legal issues related to e-commerce, such as e-discovery and cyberbullying.
ü The importance of privacy and information rights, including informed consent, data security, and due
process in handling personal information online.
ü Technological tools and methods used to protect online privacy and reduce tracking and surveillance.
ü Consumer and seller protection mechanisms against online fraud, including third-party assurance
services and best practices for fraud prevention.
ü The role of intellectual property laws and the different types of legal protections for creative and
proprietary works.
ü The key Philippine laws governing e-commerce, data privacy, cybercrime, and consumer protection,
which provide a legal framework for secure and ethical online transactions.

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 REFERENCES
Laudon, K. C., & Traver, C. G. (2023). E-commerce: Business, technology, society (17th ed.). Pearson.

Bass, K. (2021). E-commerce and mobile commerce technologies (1st ed.). ED-Tech Press.

Department of Trade and Industry – E-Commerce. (n.d.). Related laws and policy issuance. Retrieved
January 11, 2026, from [Link]

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