5 Things You Must Know if You Are Selling Online or by Telephone to Consumers

selling-online-law

If you sell online or by telephone to consumers these regulations are critically important.

The full title of these regulations is a mouthful: European Communities (Protection of Consumers in Respect of Contracts Made by Means of Contracts Made by Means of Distance Communication) Regulations, 2001 (SI 207/2001).

But they are of critical importance if you are involved in e-commerce or selling goods or services online to consumers under distance contracts.

What Businesses are Affected?

  • All businesses who sell online to consumers
  • All businesses who sell by telephone to consumers
  • All businesses who sell by direct mail.

Financial services are not covered by these regulations but by different 2004 regulations: EC (Distance Marketing of Consumer Financial Services) Regulations, 2004.

What Transactions are Affected?

Distance contracts which are

 In these Regulations “distance contract” means a contract between a supplier and a consumer which –
(a)  relates to goods or services,
(b)  is made under an organised distance sales or service-provision scheme run by the supplier, and,
(c)  is made by the supplier making exclusive use of one or more means of distance communication up to and including the moment at which the contract is made,
other than –
(i)   in the case of any provision of these Regulations (including a provision referred to in paragraph (ii)) a contract which –
(I)    relates to financial services, including financial services referred to in Annex II of the Directive which, for convenience of reference, is set out in Schedule 2,
(II)   is made by means of automatic vending machines or automated commercial premises,
(III)  is made with telecommunications operators through the use of public payphones,
(IV)  is made in respect of the construction and sale of immovable property or relating to other immovable property rights, other than the rental of such property or rights in such property,
or,
(V)  is made at an auction,
(ii)      in the case of Regulations 4, 5 and 6 and 7(1), a contract –
(I)    for the supply of foodstuffs, beverages or other goods intended for everyday consumption supplied to the home, residence or workplace of the consumer by regular roundsmen,
or,
(II)   for the provision of accommodation, transport, catering or leisure services where the supplier undertakes, when the contract is made, to provide those services on a specific date or within a specific period.

 

These regulations do not apply to

  • Auctions
  • Vending machines
  • Contracts in connection with property.

The distance communication must be the only method of communication with the consumer for these regulations to apply-if a face to face meeting was involved then the regulations do not apply.

The means of distance communication are also set out in the regulations:

Means of communication covered by Article 2(4)
–          Unaddressed printed matter
–          Addressed printed matter
–          Standard letter
–          Press advertising with order form
–          Catalogue
–          Telephone with human intervention
–          Telephone without human intervention (automatic calling machine, audiotext)
–          Radio
–          Videophone (telephone with screen)
–          Videotex (microcomputer and television screen) with keyboard or touch screen
–          Electronic mail
–          Facsimile machine (fax)
–          Television (teleshopping).

 

How Do the Regulations Affect Consumer Contracts?

1.     Prior Information

The contract is not enforceable against the consumer unless she has been given certain prior information This information includes

  • The identity of the supplier
  • The main characteristics of the goods/services
  • Price
  • Delivery costs if any
  • Arrangements for payment, delivery
  • The right of cancellation
  • The period for which the price remains valid.

2.     Cooling Off Period

The consumer has a right to a cooling off period of 7 days during which he can cancel without giving a reason.

If the confirmation obligations have not been complied with then the cooling off period is extended by up to 3 months.

However the consumer’s right to cancel does not apply

  • For services if performance has already commenced with the consumer’s agreement
  • Goods/services which are subject to change in the financial market
  • For perishable or customised goods
  • For newpapers, magazines and periodicals
  • For audio or video recordings or computer software which was unsealed.

If the consumer exercises his right to cancel during the cooling off period then he is entitled to a reimbursement even if the condition of the product is perfect.

This is unique in consumer legislation.

3.     Time Limit on Performance of Contract

There is a time limit of 30 days within which the supplier must perform the contract.

4.     Inertia Selling

Inertia selling-a demand for an unsolicited product or service-is prohibited.

5.     Fraudulent Credit Cards

The Regulations also give the consumer a legal right to demand the immediate cancellation, re-credit or return of any payment where fraudulent use has been made of her credit card(s).

Non -Compliance

A person who fails to comply with these regulations will be guilty of an offence and can be fined up to €3,000.

The Director of Consumer Affairs can apply to the High Court for an order to carry out compliance of the contract.

These regulations are obviously of enormous importance to internet sellers and must also be read in conjunction with other consumer protection legislation including the Electronic Commerce Act, 2000,  sale of goods and supply of services legislation, misleading advertising legislation, unfair contracts and defective products legislation.
By Terry Gorry
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The Electronic Commerce Act, 2000-6 Key Issues for Business Owners

electronic commerce act

The Electronic Commerce Act, 2000 might strike you as exciting as a wet weekend in Mullingar.

But..

Do you have an electronic signature at the end of your emails? Or an advanced electronic signature?

Do you know the difference? And the significance?

Have you ever worried about unwittingly entering into a contract after hitting “send”?

The Electronic Commerce Act, 2000 implements EU directives on electronic signatures and some provisions coveing electronic commerce. (This piece should be read in conjunction with the piece on the Electronic Commerce Regulations, 2003.)

This act does not apply to the sale of land or wills/trusts which must still be evidenced in writing.

And it makes a distinction between electronic signatures and advanced electronic signatures.

This act also recognises that electronic communications, signatures and contracts cannot be denied legal effect simply because they are in this form. However the parties must consent to the information being provided in electronic form for it to have full legal recognition.

1. Electronic signature

An electronic signature is defined in the Electronic Commerce Act, 2000 as

“electronic signature” means data in electronic form attached to, incorporated in or logically associated with other electronic data and which serves as a method of authenticating the purported originator, and includes an advanced electronic signature;

This can include your name typed at the end of an email or a scanned version of a handwritten signature.

Generally this type of signature has the same effect as a hand written signature.

2. Advanced electronic signature

An advance electronic signature is defined as:

“advanced electronic signature” means an electronic signature—
(a) uniquely linked to the signatory,
(b) capable of identifying the signatory,
(c) created using means that are capable of being maintained by the signatory under his, her or its sole control, and
(d) linked to the data to which it relates in such a manner that any subsequent change of the data is detectable;

 

This is uniquely linked to the signatory, created by means under the sole control of the signatory and linked to the data in such a way that any subsequent change of the data is detectable.

3. Certification Service Providers

The Electronic Commerce Act, 2000 also deals with certification service providers in Part 3 of the Act.

Unusually the act allows certification services to act without prior authorisation.

4. Electronic Originals

Section 17 of the Act allows the retention and presentation of electronic forms of “original” information provided certain requirements are met.

(2) Information may be presented or retained as provided in subsection (1) only—
(a) if there exists a reliable assurance as to the integrity of the information from the time when it was first generated in its final form, whether as an electronic communication or otherwise,
(b) where it is required or permitted that the information be presented— if the information is capable of being displayed in intelligible form to a person or public body to whom it is to be presented,
(c) if, at the time the information was generated in its final form, it was reasonable to expect that it would be readily accessible so as to be useable for subsequent reference,
(d) where the information is required or permitted to be presented to or retained for a public body or for a person acting on behalf of a public body, and the public body consents to the information being presented or retained in electronic form, whether as an electronic communication or otherwise, but requires that it be presented or retained in accordance with particular information technology and procedural requirements— if the public body’s requirements have been met and those requirements have been made public and are objective, transparent, proportionate and non-discriminatory, and
(e) where the information is required or permitted to be presented to or retained for a person who is neither a public body nor acting on behalf of a public body— if the person to whom the information is required or permitted to be presented or for whom it is required or permitted to be retained consents to the information being presented or retained in that form.

5. Electronic Contracts

Section 19 confirms that an electronic contract shall not be denied legal effect solely on the grounds that it has been concluded electronically or by electronic communication.

Contracts. 19.—(1) An electronic contract shall not be denied legal effect, validity or enforceability solely on the grounds that it is wholly or partly in electronic form, or has been concluded wholly or partly by way of an electronic communication.
(2) In the formation of a contract, an offer, acceptance of an offer or any related communication (including any subsequent amendment, cancellation or revocation of the offer or acceptance of the offer) may, unless otherwise agreed by the parties, be communicated by means of an electronic communication.

6. Defamation

Section 23 provides that

23.—All provisions of existing defamation law shall apply to all electronic communications within the State, including the retention of information electronically.

So, the Electronic Commerce Act, 2000 may play a bigger role in your business activity than you thought.

And a weekend in Mullingar is not so boring either.

No, seriously.
By Terry Gorry
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5 Illegal Uses of the Internet and How To Combat Them

illegal-uses-of-internet

The internet has caused a revolution in the way we live and communicate.

But businesses can be the victims of illegal activity on the net.

What are these illegal activities? What can you do about them if your business is a victim?

There are 5 common illegal activities:

  1. Hacking
  2. Harvesting
  3. Hypertext links and “deep linking”
  4. Framing
  5. Trade mark infringements and meta tags.

1. Hacking

Hacking is the use of a person’s computer skills to break into a computer system or website to create damage or steal information.

Hacking is difficult to prosecute but The Criminal Damage Act 1991 makes provision for this.

The Criminal Damage Act 1991 covers damage to property and property includes data; damage can include altering, corrupting and erasing data.

It also covers the offence of threatening to damage property so even an unsuccessful hacker can be charged under this section.

Another section covers the situation where a person has in their possession the means to hack-again they may be charged under this section even though they have caused no damage to data.

The act also includes an offence of unauthorised access and this offence relates only to computer crime.

The act also provides very extensive powers to search and arrest under this legislation.

The Criminal Justice (Theft and Fraud Offences) Act 2001 can also be used to prosecute as it provides that it is an offence to use a computer to make a gain or cause a loss to another.

This is an example of our ordinary legislation being amended to accommodate the reality of internet law in the 20th century.

Other pieces of legislation which can be used to deal with hacking include:

  • The Data Protection Acts, 1998 and 2003
  • The Electronic Commerce Act, 2000
  • The Copyright and Related Rights Act, 2000

2. Harvesting

This is the operation of collecting email addresses for the purposes of spamming.

This clearly is in breach of the Data Protection act 1988 and 2003.

If the data harvested is not personal data it is conceivable that the harvesting may be an offence under the Criminal Damage Act, 1991.

3. Framing

Framing is the division of a website into real time “frames”. This allows the use of the website owner’s text and material to be displayed next to 3rd party material in the same window.

This may be a breach of copyright law.

4. Meta Tags and Trade Marks Infringements

Meta tags are the tags hidden in the html (or other) code of a website. They are not visible to the reader of the page.

These meta tags can infringe the trade marks of a competitor and 3rd parties intellectual property rights.

5. Hypertext Links and Deep Linking

We are all familiar with hyperlinks to other websites. On this page for example there are many hyperlinks to www.IrishStatuteBook.ie

However linking to other websites can be illegal and infringe the rights of the website owner to which you link.

It is possible that the Copyright and Related Rights Act, 2000 provides protection to the website owner to prevent deep linking to his/her website.

Another problem that can arise in this regard is the use of a registered trade mark of the target site which may also be a breach of the intellectual property rights of the target site. This type of case occurred in the United States when Playboy™ sued a porn site for using the Playboy™ logo to link to its website.

This type of breach could be pursued in Ireland based on

  • Copyright infringement
  • Breach of database rights
  • Trademark infringement
  • Passing off.

Conclusion

It’s clear from the above that you could unwittingly leave yourself open to a claim for damages.

You might as easily be a victim.

Consult a solicitor if you’re in doubt.
By Terry Gorry
Google+

Website Owner and Internet Service Provider Liability for Obscenity and Defamation-The 2 Big Problem Areas

website-defamation

Website owners and internet service providers ought to have 2 big fears:

  1. Defamation and
  2. Child pornography and obscenity.

Defamation

The Electronic Commerce Act 2000 makes it clear that the normal rules of defamation apply to information transmitted online and published on websites.

However they may have a defence if they are unaware that the material published is defamatory; once on notice of the defamation though they will have no defence.

For this reason it is prudent for website owners to utilise well drafted limitation and exclusion of liability clauses and incorporate them into their standard terms and conditions.

Owners and operators of chat rooms and bulletin boards need to be vigilant in this regard because of the access of 3rd parties to their site.

Child pornography and obscenity

The main act dealing with this issue is The Child Trafficking and Pornography Act, 1998 (amended in 2004).

This act is very broad and wide ranging and even covers ‘depictions of children’ with no need to prove that the images are actually children.

For this reason website owners must make provisions in their terms and conditions to ensure that contributors to blogs, chat rooms etc are aware of this and should be forced to scroll down through the terms and conditions and signal acceptance before being allowed to post comments, material etc.

Website owners and internet service providers should ensure that their terms and conditions include:

  • Users of the website agree not to post offensive, libellous, defamatory or unlawful material
  • The website owner reserves the right to monitor 3rd party postings on their site but do not exercise editorial control
  • The website owner may change or remove any unlawful material posted
  • The website owner does not accept liability for any linked content.

Website owners and internet service providers should also have clear procedures for dealing with complaints.
By Terry Gorry
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The 6 Things Every Small Business Ought to Know about Electronic Commerce

Electronic commerce is enormous and is set to grow exponentially.

electronic commerce law

And you may be determined to get in on the act and take a lead from Amazon.com, Google, Ebay, Paypal and other online giants.

You need to be aware of the law in this area.

The Electronic Commerce Directive (2000/31/EC) was transposed into Irish law by the “Electronic Commerce Regulations” (Statutory Instrument 68/2003).

The Electronic Commerce Regulations 2003

These regulations implement an EU directive which covers the whole area of electronic commerce and the provision of services and goods online.

A key feature is that once a provider of these goods or services is established in a member state of the EU he is entitled to provide his goods/services into any other member state. Nevertheless in Ireland our common law rules regarding the formation of contracts will continue to apply.

1.     Country of origin principle

This states that providers of goods/services will only have to comply with the rules of the country in which those service providers are established.

2.     Information before contract

One of the principle effects of the Regulations is the list of information which must be provided by businesses operating online.

This list includes

  • The name of the business
  • The address where established
  • Details of the business including email
  • Details of how people can elect not to receive unsolicited commercial communications
  • The trade register applicable to the business, if the business is registered on a trade register
  • Any supervisory/regulatory authority governing the industry
  • Vat no. of business
  • Prices must be shown clearly and unambiguously.

Internet law has a huge impact on internet marketing and the various laws surrounding how we communicate by email and other electronic forms in our marketing efforts.

3.     Rules for commercial communications

All commercial communication should be clearly identified as such

  1. The sender should be clearly identified
  2. Details about how the recipient can register their choice re unsolicited communication should be provided
  3. Promotional offers should be clearly identifiable as such
  4. Competitions and/or games should have their rules of participation clearly accessible.

Internet law also requires that other information and the steps taken to communicate are done within certain boundaries.

4.     Other information required re consumer contracts concluded online

  • The steps needed to be taken to conclude the contract
  • The means for correcting input errors before placing the order
  • Whether the concluded contract will be filed by the service provider
  • However this does not apply when the contracts are concluded exclusively by email.

5.     Procedures to be followed when contracting online with consumers

When the order is placed by the consumer the supplier should acknowledge its receipt without delay by electronic means.

The order and acknowledgment are deemed to have been received when the party to whom it is addressed is able to access it. It is not a defence to refuse to open email when you know it contains acceptance of an offer for example.

6.     Liability of Internet Service Providers

The Electronic Commerce Regulations also lays down rules in respect of internet service providers.

An ISP is not liable for the information it transmits where it is merely acting as a conduit for such information (But the ISP must be passive in this regard).

ISPs are also excluded from liability regarding hosting of websites when the information is provided by third parties. However the ISP will not be excluded from liability when they know that the information being hosted concerns unlawful activities.

ISPs are also exempt from being sued re breach of copyright where they cache information which is copyrighted.
By Terry Gorry
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