Understand and comply with e-commerce law and the regulations when selling online or advertising.

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The internet is now a fundamental part of business and very few businesses can avoid the need to understand and comply with e-commerce law, whether you are actively selling goods or services via your own website or perhaps advertising or even selling via a 3rd party website such as Ebay.

E-commerce is also complicated by the fact that it often involves instant online transactions where your business may be selling or buying to or from a 3rd party based anywhere in the world. Different laws can apply depending upon where the transaction takes place and it may be that you need to comply with laws of more than 1 country.

Due to the speed of doing business online, it is imperative that you have a good understanding of what laws may apply and take practical steps to protect your interests and to ensure that there is some form of contract to protect you, which is to your advantage, or at least, which is not highly unfavourable.

 E-commerce contracts – how we can help 

We offer an experienced and cost effective service which can include :-

  • drafting website terms and conditions.
  • advising on a 3rd party set of terms and conditions – such as the impact of trading on Ebay and how this may impact you.
  • consultancy and training on e-commerce law – the risks that can arise for your business and how to mitigate.
  • advice, negotiation or drafting of e-commerce contracts – such as website joint ventures, affiliate or other type agreements.
  • advice on advertising law – how it impacts on how you market online and what you say.
  • employment law aspects of trading online – such as ensuring your employment contracts make clear who owns social media accounts and confidentiality issues.
  • database law advice – where your business collects confidential client information, what your legal obligations and risks are and how to comply
  • if your business trades online, it’s vital your website and computers are kept safe and operative. You may decide to have an outsourced IT service contract. We can advise and assist with the negotiation and possible pitfalls of Service Level Agreements (SLA’s) offered to you.
  • advising on and helping to mitigate the risks associated with employee email use – where a contract may be concluded or varied by staff, via email, without them or you knowing or understanding that this can happen and what the risks are.
  • intellectual Property and how do you protect it – a website, database or domain name may be your business’ most valuable asset – who owns the website or domain?
  • protecting your reputation – what are people saying about you and your business? Are they breaching your legal rights and what are the remedies?
  • EU law – may also apply to your online activities, such as so-called cookie law and data protection and privacy issues.

 E-commerce regulations 

With the rapid expansion and development of the Internet, the way customers shop and commercial law operates has changed. More and more business is done online with the use of the World Wide Web. In fact, some companies’ sole existence is as an online business.

What is e-commerce?

Electronic commerce or e-commerce means buying or selling products by electronic means such as the use of the Internet. There are a range of online shops, which only exist on an Internet platform; others treat the Internet as a medium which facilitates trading. E-commerce includes the exchange of data necessary to make a purchase or place an order such as names, addresses and bank or credit card details of both the supplier and the consumer.

Distance selling

Distance selling can save costs (there is no need to pay rent or mortgage on a shop premises). Some businesses operate telemarketing with orders placed by a phone, e-mail or post as well as from a catalogue with the business’ offer. Distance selling is not the same as online selling where the process of sale happens online.

 E-Commerce Regulations 

Who do they apply to?

The regulations apply to every business which offers Internet marketing within the UK or European Economic Area (EEA), which means it is nearly every commercial website. Such businesses must comply with the E-Commerce Regulations, regardless of whom it sells its products or services to (individuals or other businesses). If a business sells goods or services on the Internet, by email or text message, it has to comply with the regulations.

What is excluded from the regulations?

The e-commerce regulations only apply to the laws passed from the 30 July 2002. The regulations do not apply to tax, gambling or lottery and do not affect data protection laws. Direct marketing over a phone or fax are not covered by the regulations.

What is their purpose?

The regulations aim to ensure transparency in online transactions. The seller needs to provide the consumer with necessary information such as terms and conditions and fine print as well as give them the right to cancel their order within a specified time.

What information must be provided?

The following minimum information must be provided to the consumer and be easily accessible:

  • The name of the service provider: the consumer must be informed who he or she is dealing with and be able to easily find it on the website
  • The email address of the service provider so the consumer can contact the business whenever he or she needs to
  • The address of the service provider: if it is a company then a registered office address needs to be given
  • The company’s registration number if the service provider is a business
  • VAT number if available
  • Prices must be transparent: state whether they include VAT and delivery costs
  • There must be a clear description of goods or services offered
  • Payment method and delivery arrangements (within 30 days if not stated otherwise) must be specified
  • Cancellation rights should be provided (usually 7 days after the goods are delivered or contract of service is agreed) and it should be clarified who is responsible for the costs of returning the goods

Online contracts and placing an order

Under the e-commerce regulations an online seller must allow the consumers to correct any errors whilst placing an order (such choosing the wrong quantity or product or inputting an incorrect delivery address) before their order is complete (normally before it is dispatched).

The seller must give the consumer notice that their order has been received. It usually takes the form of an automated message: ‘Thank you for placing your order’ or ‘your order has been received’.

The seller needs to provide the consumer with terms and conditions of the sale on their website and it is advisable that you are familiar with them in terms of delivery and payment methods, returns and refunds before placing your order.

Summary

As with many aspects of the internet, it move so fast, and is so difficult to regulate, that many online sellers are not even aware of the regulations, and others simply ignore them. Do so at your peril, the law will eventually catch up and aside from anything else, a reputation for not being trustworthy or complying with the law can spread virally on the internet very fast.

 We can help, whether you are an online retailer, possibly setting up an online business or an aggrieved customer who believes that the seller has not complied with the regulations. Get in touch for further information and advice. 

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