Tuesday, 10 June 2008

Are you breaking the law?

Your company could be breaking the law when it comes to selling over the Internet.

Graham Davies, from our Commercial Team, said research had shown that up to two thirds of companies selling online could be breaching the rules. The websites were checked in relation to the Consumer Protection (Distance Selling) Regulations 2000 and the Electronic Commerce (EC Directive) Regulations 2002.

“The vast majority of the websites surveyed appeared to impose conditions that deterred customers from using their cancellation rights, and 15 per cent did not point out to customers that they had the right to cancel an order within seven days. And another 31 per cent failed to refund the full cost if an item was returned.”

Graham said it was vital for companies to include details of their cancellation and refunds procedure on their website. “Include this information in a terms and conditions section, and to protect your company still further, make sure customers can’t proceed to the checkout until they’ve accepted these terms.

“Make sure you clearly spell out your pricing structure, particularly when it comes to any additional charges that may be incurred, and do this well before the customer gets to the payment stage of the site.”

Graham said many companies also failed to include a full physical contact address on their website, as well as an email address (not just a web form) so customers could contact the supplier.

“The Companies Act 2006 says not only must you include your full physical address, but also your company number and where the company is registered on all your literature, which includes your website.

“If you consistently fail to include clear information on cancellation rights, refunds and extra charges in the main body of your website, you could face legal action – so take steps to protect your company and your customers.”