Internet law for business
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What laws affect online businesses in the UK
Before starting a fresh online business in the UK, you need to familiarise yourself with different aspects of internet law, those which are specifically applicable to businesses. Business internet law, incudes statutes and regulations that govern e-commerce and the sales of goods and services in the UK.
Despite the fact that the UK has left the EU, there are still many laws and regulations in the UK, that apply to all business activities and that are either mirroring or reflecting on what is required of an online business by EU law.
The E-Commerce Regulations 2002, are laws that apply to operators of commercial websites across the EU, UK included. Any commercial website which operates in the UK must have its terms and conditions of use to be compliant with the E-Commerce Regulations. This is because compliance will bring it into line with all other online businesses across the EU. The main purpose of the E-Commerce Regulations is to give EU consumers a guarantee as to minimal purchasing protection across the EU.
This does not mean that an online business in the UK must only comply with the minimal EU consumer protection requirements. If there are (and there often are) additional consumer protection laws that are exclusive to the UK, the business must comply with those too. The E-Commerce Regulations require every online business in the UK to provide on the website, details of the name of business and its company registration number, the business address and email contact, if the business is regulated, the name of the regulator or any relevant professional body, VAT number if applicable and clearly marked prices inclusive of tax and delivery costs.
If your online business uses email or SMS marketing, each communication must make clear that it is a commercial communication and state the name of the business behind the communication (not the sender, but the person or company which the marketing email is sent on behalf). If the email or SMS include an a promotion, this must be stated in the communication itself. The E-Commerce Regulations does not completely ban the sending of unsolicited email emails, or spam. However, any unsolicited email must be capable of instantly being identified as such by the recipient.
You will need to be aware that although it is not unlawful to send spam emails under UK law, the practice might be illegal in other EU countries and in some US states. If your UK online business sales goods or services, you must make sure that you give consumers an opportunity to review their order, amend it or delete it before they complete the order. You must send a receipt as soon as possible. Even after sending a receipt to the consumer, the business may still cancel the order until such point where the business confirms that the order was accepted or until it is physically received by the consumer.
The Consumer Rights Act applies has particular application to business that sell online. Under the Consumer Rights Act you must provide your consumer with quality warrantee that last for at least 6 months and with goods that are aligned with the way your business described them online. As an online retailer, it is your responsibly to satisfy any claims by the consumer, which means you cannot simply pass an unsatisfied customer to the manufacturer of the goods.
Usually, if a consumer had purchased items from your online store, they will have 30 days to return to items to you if the purchased item is not of satisfactory quality, unfit to purpose or is different to what was described on your website. In this case, you will have to provide the purchaser with full refund. This obligation does not apply to downloads.
Post 30 days, in the event that the purchased item is faulty, you will need to either repair or replace it at your expense. In most cases, your consumers will have up to 6 months to return faulty item to you, for repair, unless you can prove that the damage to the item was caused by the buyer. If you sell on your website digital content, the buyer might have a right to request repair or replacement if the quality of the digital item he bought is of bad quality, does not fit for purpose or is different to the way it was described on your website.
The Distance Selling Regulations requires online businesses in the UK to give internet users a description of the goods or service, their price and the cost of delivery. You must also provide clear information about your business, as already discussed earlier and after the consumer places an order, you must let them know about their right to cancel and who is responsible for the cost of the returns. Every purchase in your online store, other than digital and other notable exception, is subject to a 14 days cooling off period by the buyer.
The Consumer Contracts Regulations places a few additional obligations on your online business. These includes requirements to give clear description of the goods sold on your website and if you sell a subscription service, you must provide information on how long to consumer’s commitment would last. You must also be transparent as to the total price that they consumer would pay, how it total is calculated and any additional costs that the customer might encounter.
You also need to provide a standard cancellation form and if there is a return of goods involved with the cancellation, you will need to give those from the outset. If you sell digital content, you need to give details on the compatibility of digital content with hardware and other software (subject to reasonableness) and to make sure that the consumer acknowledge that once the download starts they will lose their right to cancel.
If you sell a service online, you should not start providing the service before the expiry of a 14 days’ cooling off prior, unless the consumer expressly confirms that you may do so. If you start providing the service upon consent by the consumer, the consumer will lose their automatic right to cancel. Importantly, you cannot charge the consumer for any items which you had automatically ticked for them, for example extended warrantee or additional items which they did not choose themselves. Finally, you must not use premium rate telephone numbers to communicate with existing consumers who might call in to compliant or to request refund. You are only allowed to charge basic call rates for these calls.