Is your e-business compliant, legal and robust?

Retailers may well be scrutinising their high-street presence in the face of uncertain economic times but also...

Retailers may well be scrutinising their high-street presence in the face of uncertain economic times but also placing a greater emphasis on expanding their online share, writes Vinod Bange, an e-business and data privacy law expert at Eversheds. In doing so, they need to respect online governance, regulations and laws such as data protection.

The key points in this article highlight the key requirements in ensuring that sale processes are compliant, legal and robust.

Information requirements: the company

Websites must make certain information available to consumers (irrespective of whether any sales are made online) so it is clear who consumers are dealing with. This includes providing:

  • company name, postal address (and registered office address if this is different) and e-mail address
  • company registration number and VAT number
  • trade or professional association memberships
  • clear and unambiguous pricing (including taxes and delivery charges)

Information requirements: the contract

Before customers begin navigating through the online sales process, the site must:

  • outline the steps involved in completing the sale online
  • say whether the contract will be stored by the retailer and/or made permanently accessible
  • offer customer error flagging and correction functionality
  • list the languages in which the contract can be concluded
  • provide links to relevant codes of conduct
  • set out terms and conditions (so customers can save and print them) which make it clear who is selling the product, their postal and e-mail address, clearly describe what the customer is getting and what it will cost, including all taxes and delivery costs, and set out the delivery arrangements

Before concluding the contract, retailers also have to provide customers with the following information:

  • the identity of the retailer
  • price
  • payment and delivery arrangements
  • cancellation rights (the cooling-off period) should any exist

The contract

Terms and conditions should be robust and not expose the retailer to unnecessary risk from, say, pricing errors. This means giving careful consideration to the following:

  • clarifying the point at which the contract is formed and ensuring that all stages of the sales process and subsequent communications support that point without contradiction and ambiguity
  • effectively incorporating the terms and conditions into the contract of sale
  • providing the information required by the Distance Selling Regulations, including (where applicable) the right to a seven-day cooling-off period

Offline laws?

Many laws that apply to offline sales also apply to online sales, so existing controls and processes should be transposed, especially for areas such as:

  • consumer protection (such as quality of goods)
  • consumer credit laws for retail product finance

Borrowing terms and conditions from other websites can create a false assumption of legal assurance which will not address your own risk profile or protect your brand. Tailor your online compliance to your own online sales and fulfillment process.

Compliance beyond law?

As well as complying with existing laws and regulations, retailers have compelling reasons to go further, especially given the power of consumer opinion and backlash. Take, for example, the various privacy lobbying groups and the speed at which they can gather support and momentum to voice powerful opinion. Such opinion can force e-businesses into u-turns in the face of negative publicity against practices that may well be legally compliant but stray into a zone that customers are not comfortable with.

Vinod Bange is an e-business and data privacy law expert at Eversheds

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