Retail online is continuing to increase: with low setup costs and the potential to reach niche and mass markets worldwide it’s an attractive proposition. But if you are selling online there are some important rules you need to know about to protect your business – and your customers.
Your terms and conditions of sale must be displayed on your website where the goods are being sold and they must comply with the various regulations that apply.
The key features of the ‘Distance Selling’ regulations in the UK are:
- you must give consumers clear information including:
- details of the goods or services offered
- delivery arrangements and payment
- seller details including geographical address
- the consumer’s cancellation right before they buy (known as prior information)
- you must also provide this information in writing
- goods must be delivered within 30 days unless agreed otherwise
- the consumer has a cooling-off period of seven working days. The cooling off period begins as soon as the order has been made. In the case of goods, it ends seven working days after the day of receipt of the goods. In the case of services, it ends seven working days after the day the order was made but if the consumer agrees to the service beginning within the seven days, the right to cancel ends when the service starts
- where consumers notify the supplier in writing or another durable medium that they wish to cancel the contract, they must be refunded all money paid within 30 days.
So your Terms and Conditions need to cover all these points and useful clauses can also include:
- Price – the price of goods must be shown clearly to the customer and make it clear whether VAT is included. If packing and postage is extra, this also needs to be shown.
- Payment – it is usual to make it clear that payment must be made in full before the goods are dispatched. Sometimes a credit card transaction comes with a warning for the merchant that there is a doubt about the validity of the buyer, so you can do further checks before sending the goods if there is a potential problem
- Force Majeure – If you are unable to deliver due to some unforeseeable event such as a fire at the warehouse or a hurricane, you can reserve the right to cancel or suspend the contract
- Warranties – you have a legal obligation to deliver goods that meet the description on your website and are of satisfactory quality so why not say this in your T&Cs as it can give the customers some comfort.
In addition, a customer who wishes to purchase goods online, using a credit card or some other payment method, should be required to confirm that he/she has read the terms and conditions and accepted them before proceeding to the checkout. In order to have evidence that the customer is aware of the terms on which goods are sold, the usual system is to have a ‘tick box’ which must be ticked by the customer confirming that the terms and conditions have been read before the sale process can be concluded.
For more information on legislation and regulations governing the sale of goods and services and consumer protection, there are various Government and other websites that provide useful information including DirectGov – http://www.direct.gov.uk – and the Office of Fair Trading – http://www.oft.gov.uk/. There is also useful guidance in more detail at http://www.which.co.uk/consumer-rights/regulation/distance-selling-regulations/
ContractStore has created some ready-made documents for online retailers: