E-Commerce Law: Legal Tips for Online Stores

E-Commerce Law: Legal Tips for Online Stores

April 27, 2016

E-commerce sector deals with international trade, mobile commerce, electronic funds transfer, electronic data interchange, and many more things. Surely e-commerce security is important to protect these processes as we have mentioned earlier. Another important thing is to run your e-commerce business in the book. E-commerce law is an important thing to take into consideration when you are launching an e-commerce business. Knowing about the law will help you conduct your business legally and also protect your rights in the process. Our guide is not to be taken as legal advice but as a guide that leads you in the important directions of e-commerce law. Let’s learn more about it.

E-commerce law changes according to your country for sure. It is important that you become familiar with it. There is also a universal e-commerce law called UNCITRAL Modal Law of E-commerce. It is brought upon by the United Nations to avoid conflicts in the e-commerce laws of different countries and many countries have adopted it. E-commerce law is heavily affected by international trade laws. But there are main points you need to clarify as you launch your business.

Establishing a trademark is important while launching your business. It includes any symbol, name, word, phrase that will be identified with your business forever. Trademark is an important asset for your business because it will distinguish your business and your products from your competitors. You need to be sure you are not copying another business’s trademark while you create it because it is important to protect your rights and not harm other business’s right as well. You will need to register with your country’s trademark offices to provide that sort of protection and legitimize your trademark.

Spamming can be a problem in e-commerce law. E-mail marketing is a very efficient way to increase your conversions as we have mentioned before. But while doing so, you will be using your most important asset which is your customer e-mail database. According to Can-Spam Act in USA it is illegal to send an e-mail to a customer with the primary aim of commercial advertisement or promotion of a commercial product or service. Putting unsubscribing links in your e-mails is crucial. It can get tricky when you are sending e-mails to your customers but it is a good way to keep your customers informed about your latest products and offers, too.

Deciding on your business structure is another point on our list. You will need to pick out of three options to be liable to rules, different taxations. They are Sole Proprietorship, Partnership or Corporation. First one is the most common structure among online store owners. It has relatively lower risks of liability if anything comes up. This way your personal and business assets will be the same and you will receive your tax returns in your own personal tax return. Your business will be easy to launch and run and the company won’t have to file taxes. However, you will be responsible for all the debts and actions of the company and if you make too much money you will face a higher tax.

Partnership structure for your business is good if you are 2 or more people launching the business. You will need to have a partnership agreement but it would be wise to have a lawyer assist you in the process because in partnerships your partner might act differently than you hope. Reliability of your partner is important because if they bail on you, you will face all the debt or actions they took behalf of your business and be liable for them. In a corporation, your personal assets will not be attached to the corporation as one and the same. You will have tax advantages and it will improve your credibility. However it is important too, again, have the assistance of a lawyer if you decide on choosing this option. Because corporations are heavily regulated and keeping extensive records are required. It is also more costly to form.

Another important aspect of e-commerce law is customer rights and consumer law. Your online business might be selling its products to other countries so it is important to follow their law on this issue as well. When your customer wants to send their order back there is a deadline for it. But as a consumer, they have a right to send it back before x days and you need to know this sort of things to keep your business in line. This sort of information should also be shared with the customer before they pay for the product.

Data protection in e-commerce is an important area to look at. Your customer will provide you with their address, telephone number, and even their credit card information. You need to have a privacy policy explaining what your purpose is while you are asking for all of this data. Your disclosure to the 3rd parties will have to be present in there as well. E-commerce fraud is a very common thing and customers of today are more and more interested in protecting themselves from any kind of fraud. As a business owner, you need to make sure you cover all the details before launching your business.

Launching an e-commerce business requires too many legal implications for you. You need to know how to establish your trademark, handle taxes and decide on a business structure or your customer’s rights. As long as you comply with the law you will be fine. Good luck on your new or old online business and hope you find this article helpful.

E-commerce law is important when you are starting an online retailing business.


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