Do You Sell or Advertise to Consumers Electronically (Internet, SMS)?

Tuesday, December 11th, 2012

The Electronic Commerce (EC Directive) Regulations 2002 (the ‘ECRs’) apply if you supply information society services (‘ISSs’). ISSs normally include any service provided on request for payment, at a distance, by means of electronic equipment for the processing and storage of data. It might sound a bit technical but the ECRs apply to virtually every commercial website.
1. Application of the ECRs
Their focus is on the provision of information to consumers. The OFT’s view is that they cover buying and selling online; offering online information or commercial communications; providing tools for search, access, retrieval of data; video on demand; web hosting and operating a communications network. The ECRs also apply if you market or sell using emails, interactive TV or text messaging. The ECRs do not apply to goods and services that are only supplied off-line. However, if they are advertised online or other ISSs relating to those goods and services are supplied online or electronically then the ECRs do apply to those services.
2. How do I ensure that my business complies with the ECRs?
Before the consumer decides to buy, certain pre-contract information must be made “easily, directly and permanently accessible,” for example, on a website. Some of the actual information to be provided overlaps with the information that you must supply under the Distance Selling Regulations (the ‘DSRs’) (see the two articles posted on the requirements of the DSRs). This pre-contract information includes:
• the full name of your business;
• the geographic address of your business, which means your home address if you are trading from home as that is where your business is established;
• your contact details, including an email address, to enable rapid, direct and effective communication with you details of any publicly accessible trade or similar register with which you are registered, including the name of the register and your registration number or other means of identification in the register;
• if your service is subject to an authorisation scheme, details of the relevant supervisory authority;
• if you are a member of a regulated profession, details of any professional body with which you are registered; details of any professional titles you hold; details of the European Union member states in which the titles have been granted, and a reference to the professional rules and how they can be accessed;
• your VAT registration number if you are subject to VAT;
• where you refer to prices, a clear and unambiguous indication of those prices and whether the prices include taxes and delivery costs (but note that the DSRs also require you to quote prices inclusive of all taxes if the sale is covered by the DSRs).
3. What if the contract is also concluded by electronic means i.e. on a website or interactive TV?
Before an order is placed, for example, on a website, this additional information must also be provided to customers in a clear, comprehensible and unambiguous manner:
• the different technical steps to follow to conclude the contract whether or not the contract will be kept by you and whether the concluded contract will be accessible by you;
• how customers can identify and correct input errors prior to placing the order;
• the languages offered for conclusion of the contract any relevant codes of conduct to which you subscribe and information about how they may be consulted electronically.
4. Are there any other requirements for ordering under the ECRs?
Customers who place orders through websites or other electronic means need certainty about the terms of their order, so under the ECRs you must:
• acknowledge the receipt of the order electronically without delay (there is no requirement to ‘accept’ the order at this point but you should state that it is a mere acknowledgement of order and that acceptance of the offer will follow); and,
• provide customers with effective and accessible technical means allowing them to identify and correct input errors before their order is placed. (Note that If you do not allow a customer to correct input errors and they enter a contract to which the ECRs apply, they can rescind the contract).
These requirements in sections 3 and 4 above do not apply in the case of contracts concluded through email or other equivalent individual communications. Click on the link to access the ECRs for further reading
It is important to know what rights consumers have, and try to deal with complaints as quickly and as helpfully as possible. You will also need to know about other legislation that applies to your business. Hanne & Co is happy to keep you informed of the key legislation applicable to your business.
Further information on the ECRs can be found at: DTI guidance on the Regulations (30-page / 262KB PDF)