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Whether your business is trading online or not, it is very likely to be affected by the E-Commercial Regulations (Electronic Commerce (EC Directive) Regulations 2002) which were introduced in the UK in 2002.
Under the ECR 2002, the regulations refer to an information society service which is defined as “any service normally provided for remuneration at a distance, by means of electronic equipment for the processing (including digital compression) and storage of data, at the individual request of a recipient of the service”.
This means that virtually every website that offers products to customers is affected. However, it is not just restricted to buying and selling online. It is extended to cover aspects such as those companies offering online information or commercial communications (such as adverts) or providing access to search and retrieve data.
The ECR 2002 do not cover whether you can sue or be sued, but they do provide the law which applies if there is a dispute relating to e-commerce.
However, certain services are excluded from the regulations and include matters such as;
2. Betting, gaming or lotteries
3. Data protection.
Furthermore, it should be noted that the ECR 2002 only apply in relation to Acts of Parliament that were passed prior to the date the ECR 2002 were implemented in the UK. For legislation that post-dates the ECR 2002, the regulations have to be implemented on a case-by-case basis.
In the ECR 2002 it states that they do not apply the country of origin principle to the terms of consumer contracts. This means that a UK based website terms and conditions should meet the laws of every Member State in which customers can purchase their products, not just the applicable UK law.
Under the ECR 2002, service providers have to present the minimum information which must be easily, directly and permanently accessible;
1. The name of the service provider and if the company is trading under a separate name this must be displayed clearly
2. The geographic address of the service provider
3. The details of the service provider including email address, so long as it allows quick contact and direct communication
4. Details of any registration numbers
5. A VAT number even if the website is not being used for e-commerce purposes
6. Prices on the website must be clear and unambiguous and should also state whether they are exclusive of VAT and delivery charges.
If your company uses text messaging to promote services, then you will still be subject to the ECR 2002 regulations. However, the issue is how to comply with information requirements with 160 characters. It is advised, that at the end of the message it may be sufficient to provide the URL of a website where full information can be obtained.
If a company is marketing via email or text messaging, they must clearly identify;
1. That it is a commercial communication
2. The person on whose behalf it is being sent and
3. If relevant, that the communication is a promotional offer and the conditions should be clear, unambiguous and easily accessible.
In addition to the above, certain information must be given where a contract for goods or services is concluded by electronic means. Before an order is placed, the seller must provide the following information in a clear, comprehensible and unambiguous manner;
1. The different steps to follow to complete the contract
2. Whether or not the completed contract will be filed by the service provider and whether it will be accessible
3. The technical means for identifying and correcting input errors prior to placing an order and
4. The languages offered for the conclusion of the contract.
However, these requirements are not necessary should the contract be concluded exclusively via email or equivalent one to one communication
Furthermore, where a seller refers to terms and conditions applicable to the contract, they must be made available to allow the user to store and reproduce them.
In order to determine whether your e-commerce business complies with the ECR 2002 regulations, it is advised to take the following steps;
1. Determine whether you have appropriate terms and conditions and disclaimers in place
2. Does your order process take advantage of the ECR 2002 to acknowledge rather than accept orders
3. Do you have insurance in place
4. Check your international exposure
5. Ensure you are familiar with which countries allow unsolicited email to be sent
6. Ensure you fully comply with conditions for making online contracts.