E-commerce law for businesses

201710.05
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How are E-commerce businesses affected by the Australian Consumer Law?


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The rapid growth of e-commerce has provided for widespread benefits for both the customers in the form of more competitive pricing as well as the entrepreneur behind the business by giving them access to a much larger pool of international customers. But, it is essential for e-commerce businesses to understand the Australian Consumer Law and its application to their operations when selling goods to customers located in or connected with Australia. Entrepreneurs must take care to not engage in conduct which may be viewed as false and dishonest advertising or mislead and deceive their customers with untruthful advertising practices. The following article explains the importance of conditions to be met under the Australian Consumer Law.

Advertising:

The Australian Consumer Law protects the users of online stores, e-commerce websites, blogs, email marketing and other any other advertising sources which results in a customer purchasing a good or service online. In Australia, it is a right of the consumer to receive full and truthful information about any product or service they may wish to buy from e-commerce stores and entrepreneurs must be mindful of the accuracy of the information which is presented online to engage a customer and making a sale.


Intellectual property:

It is customary for many resellers of online goods to copy images, designs, layout and even the logo associated with that good. For example, online clothing retailers may re-sell or distribute a particularly well-known clothing or makeup brand and use the imagery associated with that brand to encourage potential customers to shop from their site believing that there is a prevailing relationship between the brand and the seller. The unintended infringement of a supplier’s intellectual property can be a serious legal issue.


Domain name:

Often when customers search for a well-known site, unscrupulous users may have created bogus or ambiguous sites linked to a common domain name. This practice not only leads to confusion of less sophisticated customers but it also has the potential to damage the brand reputation. Any site which falsely represents an affiliation with other business through their domain name or uses another organisation’s IP as their domain name can face significant penalties.


Hyperlinking the association:

As Search Engine Optimisation theory suggests, linking to other sites is one of the best way to gain traction, but it is not entirely true if it represents a false relationship with the other business. If linking has the effect of misleading customers, the business opens itself to wide legal liability.


Conclusion:

All e-commerce businesses should consider the implications of the Australian Consumer Law on their operations. The areas to note include the accuracy of online advertising, web layout, use of third party intellectual property and hyperlinking association. These factors not only help a business to comply with the legal obligation but would certainly help build trust amongst Australian customers.

By:

ehsan_fallahi

 

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Ehsan Fallahi

Ehsan acts as legal counsel to entrepreneurs and is dedicated to maximising value, reducing risk and devising exit strategies. He has advised local and international entrepreneurs in industries such as information technology, property, telecommunication and e-commerce.

His main areas of practice are commercial law, asset protection, property law and technology.

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