By Healys Solicitors(Healys Solicitors)
The original EU directive, from which the Regulations derive, applies to all Member States of the European Economic Area (EEA), which consists of all the 27 Member States of the EU plus Norway, Iceland and Liechtenstein. ... SEE BELOW
Healys Solicitors - London -... - http://articles.healys.eu/
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Singapore is also one of the few offshore centers which was not included in the EU Savings Tax Directive in 2005, an EU initiative to exchange information on EU citizens parking money abroad for tax reasons. In Singapore, not paying ...
Sgpolitics.net - http://www.sgpolitics.net/
Another report added: “Interestingly enough, Singapore is the jurisdiction that has been favoured by many seeking to remove assets from the European Union and the other nations that signed up to the EU Savings Tax Directive. ...
sgBlogs - Singapore's Blogosphere... - http://sgblogs.com/entries
Thursday, 11 December 2008
Thinking of setting up online?
Over twenty thousand people applied for the next series of The Apprentice. Dragon’s Den, the venture-capitalist television program, is into its sixth series and in the last financial year Companies House processed upwards of 372,400 company incorporations. As the slump continues, and despite the endlessly depressing economic news, confidence in one’s own abilities and faith in one’s business ideas is demonstrably alive and well.
We are regularly approached by clients seeking to launch new online businesses, which invariably involve online sales.
The remote nature of the transactions poses a number of challenges for the e-trader and, as one might expect, a number of legal factors need to be considered before launching an e-commerce website.
E-commerce Regulations
E-marketing is regulated by several pieces of legislation, chief of which are the Electronic Commerce (EC Directive) Regulations 2002 (“the Regulations”).
The original EU directive, from which the Regulations derive, applies to all Member States of the European Economic Area (EEA), which consists of all the 27 Member States of the EU plus Norway, Iceland and Liechtenstein.
Which websites have to observe the Regulations?
If you sell goods or services to businesses or consumers on the Internet, (or by email or SMS) chances are that the Regulations will apply to you.
In fact, the Regulations are broad enough to cover websites which don’t trade but which advertise, provide an online search facility or supply so called “on demand” video (the Youtube and iplayers of this world for example).
An entrepreneur might think that a creative way to get round the Regulations would be to move one’s equipment (server etc) out of the EEA, but this would not achieve the desired result; continuing to trade in the UK, wherever the seller is located, will not prevent a website from being caught by the Regulations.
What do I need to have on my website?
The Regulations identify certain information which the e-trader must provide to his customers. There are also requirements regarding what must be done in relation to marketing the business. The information below is the minimum that should be displayed.
- The business’ name (and trading name, if different) must be clearly stated.
- An email address for the business.
- The location (specifically, the postal address) of the business.
- If applicable, the e-trader should state the business’ VAT number.
If the business is a company:
- The registered office address (if different from the address provided under 3 above) must be included.
- The company's registration number should be given.
In addition to the above, the e-trader should ensure that all prices stated on his website are unambiguous (including whether or not the price stated includes VAT and/or delivery)
Advertising
The e-trader needs to be very careful before openly advertising on the net. There is a wealth of legislation governing online marketing and privacy issues (Privacy and Electronic Communications Regulations for example). This article is only concerned with the broad principles/requirements set out in the Regulations:
Emails and SMS (text) messages are likely to be regarded by the Regulations as "commercial communications". Any such email and or text message advertising must identify clearly the business (or person) on whose behalf it is being sent. If appropriate, the email or text should, if it is a promotion, contain details of the offer.
The DTI appreciates that text messages can only be maximum of 160 characters per message and have issued guidance notes which imply that you can achieve compliance with the Regulations by making the above information easily accessible by other means. So consider including in your SMS a link to the information on your website. Please note that the DTI’s notes are for guidance only - following that guidance will not guarantee that you are complying with the law.
Unsolicited email marketing
Unsolicited email marketing or “spam” is also covered by the Regulations. The e-trader must ensure that all communications are identifiable from the subject line of the email (i.e. without the need to read the whole of the message).
Distance Selling
The Consumer Protection (Distance Selling) Regulations 2000 (“Distance Selling Regulations”) were implemented to protect those customers who are not present (with the seller) at the time of purchase. Therefore they do not only apply to online sales but also to purchases made over the telephone and by mail order.
It is worth noting that the Distance Selling Regulations only apply as between businesses and consumers and do not cover business-to-business contracts.
The Distance Selling Regulations demand that a consumer has the right to:
- details in writing about the e-trader (including address) and the terms of the transaction;
- written confirmation of orders;
- further information, including a notice of cancellation rights, the complaints procedure, after-sales services and guarantees; and
- delivery of goods within 30 days unless otherwise agreed
In addition to the above, the Distance Selling regulations stipulate that additional information is provided to the customer prior to the customer being committed to conclude a contract. This information includes a description of the goods or services offered and the price of the goods or services (including all taxes).
Under the Distance Selling Regulations, consumers must be given a cooling-off period during which he can cancel the contract (without reason). This cooling off period is 7 business days. which runs from the day after the date of the contract, in the case of services, or in the case of goods, from the day after the date of delivery of the goods in which to cancel the contract.
Furthermore, the consumer is entitled to receive a full refund for a cancelled contract within 30 days.
Furthermore, the consumer is entitled to receive a full refund for a cancelled contract within 30 days.
Terms & Conditions
It is imperative that anyone setting up an e-commerce site should have suitable Terms and Conditions. The terms and conditions (together with the order form and privacy policy), whilst rarely read by the consumer, represent one of the most important documents for an e-commerce site.
Professional advice should be sought when drafting terms and conditions in order to ensure that a) the trader is as protected as he can be and; b) the website’s terms are clear and compliant with the relevant law.
Conclusion
This article barely scratches the surface of the legal issues to be considered by the budding entrepreneur setting up his (or her) online business. Indeed, each of the headings above could be (and have been) the subject of articles in their own right.
The correct legal advice will ensure that your new business gets off on the right foot.
The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.
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