Successfully Selling Online
E-commerce continues to be a rapid growth area, both for new businesses and for more traditional “bricks and mortar” businesses looking to diversify their routes to market. As e-commerce has grown, so new laws have been enacted to regulate it. Online traders not only need to comply with all the usual laws governing the sale of goods and/or services that apply to any business, but also with the specific legislation that governs online selling. And this will vary, depending on whether that trader sells to other businesses or to consumers, and whether they sell goods, services or digital content.
A complicated compliance picture
Online sales to other businesses (B2B sales) must be compliant with long-established laws relating to contracts, such as the Sale of Goods Act 1979 and laws relating to unfair contract terms. Online sales also need to comply with the E-commerce Regulations, amongst other things. The trading disclosures requirements of the Companies Act 2006 are also relevant.
Businesses selling online to consumers – that is, customers who are not buying from them in the course of/for the purposes of a business – must comply with the above legislation as well as a raft of further laws designed to protect consumers buying online, including the Consumer Rights Act 2015.
Key requirements of online traders selling to consumers
There are a number of important requirements that aim to provide clarity, transparency and protection for online consumers. These include:
- A requirement to provide ‘no quibble’ cancellation rights (whether or not the goods supplied are faulty), and a full refund within 14 days after the day on which the customer receives the goods. In addition, if the required information about the right to cancel (referred to below) is not provided or is provided late, the cancellation period can last for up to 12 months.
- Before a customer is bound by an online contract, the trader must make available to the consumer all the detailed information required by legislation, which includes a “model cancellation form” that consumers can use to cancel the contract. These are the “information provision” requirements referred to above. Special rules apply for mobile applications where screen space is limited.
- The trader must ensure that the consumer, when placing the order, explicitly acknowledges that he or she is obliged to pay. A click button with the words pay now or buy now is acceptable, but simply stating confirm or order now may not be.
- Pre-ticked boxes requiring consumers to pay for additional goods/services over and above those ordered by the consumer are unlawful.
- Rules detailing the returns process - which include some trader-friendly provisions such as the right (in certain circumstances) to reduce the value of the refund if the returned goods show evidence of unreasonable use.
- A confirmation of the contract, including all the information provision requirements, must be sent to the consumer.
Non-compliance will not only expose the trader to being sued by its customers (who, in any event, are not bound by the non-compliant terms), but also to enforcement action by the relevant statutory enforcement authorities (which, at the time of writing, are the Competition and Markets Authority and Trading Standards).
Our services include
LCF Law are specialists in acting for online retailers (both Business-to-Consumer (B2C) and Business-to-Business (B2B). Our services include:
- Drafting terms and conditions of sale.
- Advising online marketplace providers on their terms of business and on issues around liability for contracts formed between users of their sites.
- Advising on online subscription-based services and the contracts relating to them (including content agreements and publishing/author agreements).
- Advising on online marketing and, in particular, issues and contracts relating to Google AdWords marketing.
- Drafting “Software as a Service” (SaaS) terms.
- Advising on intellectual property rights relating to online services including copyright licensing, and trademark registrations.
- Drafting compliant GDPR/Data Protection Act 2018 privacy policies and cookies notices.
Our digital media and e-commerce expertise
LCF Law are specialists in digital media and e-commerce law. We can provide expert advice based on many years of experience in this space. We have particular expertise in preparing detailed terms and conditions to ensure that you are fully compliant with all the relevant legislation. And we can provide such contracts on a fixed price basis.
We also provide general commercial legal advice to online traders including advice on raising finance, buying or selling businesses, and on disputes and litigation.
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