In practice, many companies are absolutely unaware of the rules applicable to electronic trading. Surveys have revealed that approximately 95% of the companies that are active on the Internet disregard the relevant statutory and other rules. This is surprising, because electronic trading has become one of the most important marketing and sales channels for many companies.
In the Focus on Law section, a number of important points of attention in the field of e-Commerce are highlighted.
Together with you, we could carry out a page-by-page website review to find out where your website complies with the rules and where it does not.
Marketing, sales and the law: every man to his trade. The law and lawyers are not supposed to stand in the way of marketing and trading. But the law and lawyers should fit into the equation, just like the web designer and the copywriter should make their contribution at some point to achieve a good result. Certainly in the fast world of eCommerce, the marketer and the entrepreneur tend to lose sight of the true essence of ’trade’: trade is concluding agreements, whether there is an ‘e’ before it or not. Accordingly, there should be a solid legal framework underlying a website that allows transactions to be concluded.
The Dutch legal system does not include many obstacles to contracts concluded by electronic means. The basis principle in the Netherlands and many other countries is that an online offer and online acceptance can also result in a legally binding agreement. At the European level, these contracts are governed by the eCommerce Directive and, with respect to consumers, through the Distance Selling directives as well. These directives have been transposed into national legislation, which may vary, however, from country to country.
Outside the EU, in particular, this is not always the case in all countries. A responsible online trading strategy requires you to find out whether the method of concluding a contract is valid in the relevant country under the applicable laws. A contractual choice of law clause will usually fail to provide a solution when it comes to mandatory rules designed to protect consumers.
Structure of a website and conclusion of an agreement
The structure of the website and all stages of the transaction must be geared to online trading, which requires arrangements that are slightly different from those relating to offline trading. The legislation on electronic trading and distance selling provides for a detailed set of rules for this purpose. This includes matters such as information provision, recall terms, et cetera. Aspects such as intellectual property, personal data, disclaimer, general terms and conditions et cetera must also be included in a well-structured site. To build trust, it may be a good idea to comply with the standards of Thuiswinkel.org, for example.
It is clear that it is important to arrange these matters properly. What happens, for example, if the buyer fails to meet his obligations or if the goods delivered are defective? In such situations, it may be tricky to determine to what court the case can or must be submitted and what law governs the transaction or the performance under the contract. Proving the existence of a transaction concluded through the fleeting virtual medium may also pose a problem. A party’s evidentiary position can be improved by providing specific technical and organizational safeguards and by making the counterparty accept appropriate terms and conditions in a timely and correct fashion.
To prevent unpleasant surprises, you had better regard the lawyer as a good friend rather than as the ‘business prevention’ department, because the virtual marketer and entrepreneur (and potential customers) are not in a position to know the tricks of the trade. As stated above, every man to his trade.
If you are an Internet provider or manage a market place, for example, you may end up in tricky situations. For example, infringing material may be found on a website hosted by you. Or advertisers may offer hazardous products through your market place for which you have received a warning. What should you do? The legislator has tried to indemnify the service provider from liability or risks in some situations, but there remains a grey area in which it is unclear to an online provider of services how he should act.
The provider must also comply with various rules, such as those relating to data retention, and he must grant access to data in certain situations. These are tricky situations, which require expert legal support.