Bad news for e-tailers

E-tailers targeting the European market could fall under the jurisdiction of foreign courts when consumer disputes arise, writes...

E-tailers targeting the European market could fall under the jurisdiction of foreign courts when consumer disputes arise, writes Elsa Booth-West

The European Union is once again at the centre of controversy, with its proposal to allow consumers making online purchases to use the courts in their respective countries in the event of a dispute.

Although this is good news for consumers, who might not have the money to bring about a claim in a foreign court, it is bad news for e-tailers targeting the European market, since they could be subject to conflicting laws.

Targeting markets

In an attempt to soften the blow for business, the European Union has said that the regulation will only apply if a site is directed at the country in which the consumer resides. Yet the criteria for determining whether a site is actively aimed at a country has not yet been established. For example, will the mere fact that the site can be accessed by users in a particular country be sufficient to trigger the regulation?

Although the answer is probably no, the issue itself is a pertinent one. Only recently, a case emerged from the French courts in which American company Yahoo! was ordered to block French users from accessing an American site that sold Nazi memorabilia, since the selling of such material is against the law in France. The US site was merely available to Internet users in France; it was not directed at them.

The outcome of the French case may ultimately prove to be a one-off, but the principle of directed websites will be around for some time. Businesses should therefore remember the following:

  • The more a site actively targets consumers in a different country - via focused or interactive advertising - the more likely it is to be exposed to the law of that country.
  • Where a business is avoiding a particular market, it may be worth putting up a notice on the website stating at whom the site is aimed, or not aimed.
  • When entering a website content agreement, consider insisting on a warranty from the content provider verifying the legality of the content with respect to other countries. The content provider may be reluctant to do this, but if the content is aimed at markets where the laws are not onerous, the provider may be more willing to oblige at a reasonable cost.

    Sending offensive emails

    At the end of November 2000, Cable & Wireless dismissed six staff for sending offensive emails, highlighting the serious consequences that may stem from sending inappropriate emails in the workplace.

    Bouncing around joke emails is certainly commonplace but, with more employers implementing sophisticated email monitoring techniques, it has now become a risky pursuit.

    With the increase of discrimination claims made on the basis of sexist work environments, for example, where pornography is downloaded in an open-plan office, employers are forced to take a hard-line response and dismiss miscreant employees.

    However, as stated in last month's issue of EBR, the law surrounding email monitoring is inconsistent. The draft code from the Data Protection Commissioner restricts monitoring. Since this is the primary means by which email abuse is detected, employers are going to find it hard to defend such dismissals as fair.

    To safeguard their position, therefore, businesses should make it clear that disciplinary action will be taken if inappropriate material is sent out.

    Material with sexist or racist content should be banned.

    Marketing restrictions

    Although mobile commerce is still in an embryonic stage at the moment, pending the adoption of third-generation phones, one of the areas expected to flourish is location-based marketing. This is where location-specific information services, such as a route planner relevant to where the phone user is located, carries advertising for local services.

    Unfortunately, the Data Protection Registrar has announced that such activities are illegal and in breach of telecommunications regulations passed last year.

    The law is expected to change in July 2001, but anyone planning such a service should be wary.

    Major online marketers in the US have started to operate an opt-in policy that requires consumers to give their consent before receiving marketing material. When the law changes in the UK, it is likely that this stipulation will also apply here.

    Elsa Booth-West is editor of Electronic Business Law (EBL), an independent newsletter providing reviews, analysis and practical information on the legal issues of e-commerce and communications. EBL is published monthly and is available online to subscribers. For sample copies and subscription information for EBL, contact Fawzia Ittoo on (020) 7354 674, or email

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