We all buy online these days – in the run-up to Christmas, the flurry of delivery vans clogging our streets was hard evidence of our fondness for buying remotely. And when we do, most websites we buy from have online terms and conditions buried in the small print and tiny links at the bottom of the page.

As businesses, we find ourselves on the other side of this equation. Setting up online, paperless environments to communicate and do business with customers is standard practice whether you’re selling to consumers or businesses.

To protect their interests without terrifying customers with page upon page of text, many businesses use a hyperlink to their terms and conditions. There may be a tick box for the user to confirm they accept the terms. If you’re like the vast majority of us (even experienced commercial and contract managers, judging by the informal surveys we conduct at our contract law and negotiation training events), you just click the box without reading the terms. This means that most users buying online have no idea what terms apply to their transaction at the time they buy the goods or services.

Selling Online

If you sell to consumers, you must comply with a raft of UK legislation (in particular the Consumer Rights Act 2015), as well as EU directives and BIS Guidance. These all give extensive protections for consumers (people who are buying your goods or services for personal, not business use) buying online.  If you sell goods, services or digital content online, you will want to be sure your online terms protect you as much as they can. The challenge is to do this whilst still meeting your obligations under consumer regulations.

If you are selling online, you must:

  1. Provide the correct contract information to the consumer before the contract is formed (i.e. before they order).
  2. Provide a 14 day cooling-off period in which they can cancel penalty-free.
  3. Provide remedies if there are problems with the quality of your products, services or digital content.
  4. Importantly, you must ensure that your terms are provided to your customers in a ‘durable medium’. This means they should have a clear record of the terms at the point the contract was made, and they can reproduce the exact terms at a later date, without risk of you being able to access, modify or erase them in the meantime. This is a tricky area of the regulations, with legal debate and case law all the way up to the ECJ (Court of Justice of the EU) to determine exactly how ‘durable’ is ‘durable’.

Does offering my online terms via hyperlink, with ‘tick to accept’, comply?  

In the case of Content Services Ltd v Bundesarbeitskammer in 2012, the ECJ concluded that making their online terms and conditions accessible only via hyperlink did not meet the requirements of consumer regulations. Why? Because the information was only ‘made available’, it was not ‘provided ’ by the supplier nor ‘received’ by the customer. It could not, therefore, be regarded as being provided in a ‘durable medium’, as required by the regulations.

More recently, the ECJ has been considering whether an online mailbox used to inform e-banking customers of online terms and conditions complied with the requirements for both a ‘durable medium’ and the adequate ‘provision’ of information.  The preliminary conclusions (not yet final) were that while the ‘durable medium’ conditions must be flexible as technology changes over time, the online mailbox approach did not comply unless the system:

  1. informed the customer separately (e.g. by text) of the existence of new terms and conditions, and
  2. encouraged the user to electronically store or print the documents through an easily accessible function.

In line with these ECJ decisions, it is likely that many suppliers of goods and services will find themselves in breach of the regulations.  This is an ideal opportunity for you to check your online terms and conditions and the process by which customers agree to them. You will also want to assess any messages you present to customers during the buying process, to make sure you’re doing everything you can to help them understand their rights and obligations. Otherwise, however carefully crafted they might be, you’ll find your online terms and conditions are not worth the paper they’re written on!

If you’re feeling lost then pick up the phone or email  us at Devant for help in understanding and complying with the endless flow of consumer-friendly law. We’ll ensure you don’t find yourself with worthless protection and invincible customers.

Janine Scott
Senior Commercial Consultant, Devant

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