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, 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