Blog > Legal Requirements For Online Sellers
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To provide a helping hand, we've put together this list of the main regulations you should consider when carrying out distance selling, ranging from advice on how you should describe your products to what information you need to present to visitors on your website.
It's by no means an exhaustive list (please see the Disclaimer at the foot of this article for more information) and not all the regulations listed will affect everyone, but these laws should be fully considered before you publish your website.
Your product/s must be of the quality that they are described as being in. This is laid out by the following legislation:
“Where there is a contract for the sale of goods by description, there is an implied term that the goods will correspond with the description.”
- Products must generally be of satisfactory quality and fit for purpose.
- Goods will be considered to be of satisfactory quality if they meet the standard that a reasonable person would regard as satisfactory, taking account of any description of the goods, the price and all the other relevant circumstances.
Liability arises where a product causes damage, defined as including death, personal injury, or damage to private property (subject to conditions).
- This applies to most products sold in the UK, including most second hand products.
- Producers and Distributors can be liable under the Regulation.
Who are 'Producers'?
- Manufacturer of the product
- Those with their trade mark on the product
- Those who repair or recondition the product
- Those who import the product into the EEA (European Economic Area)
What are Producer's obligations?
- Producers must not place on the market, or offer or agree to place on the market, any product that is not safe.
- Products must present no risk, or only the minimal risk compatible with the product's use, and they must be consistent with a high level of protection for consumers.
- Producers must provide relevant information to enable consumers to assess non-obvious risks associated with a product through its normal/reasonably foreseeable period of use, including information on the precautions to be taken in relation to a product. Also, what to do in the event of a problem.
- The measures taken should be commensurate with the risk presented by the products.
What are the Distributor 's obligations?
- Distributors must help to ensure product safety by not selling products that they know, or should have presumed, to be dangerous.
- Distributors should participate in safety monitoring, by passing on to customers information on any risks posed by the product, passing to producers complaints by consumers, and cooperating with the authorities and other actors in the supply chain.
- Distributors should keep documentation necessary for tracing the origin of products.
- Further obligations apply to producers and distributors in the event that they become aware that an unsafe product has been placed on the market.
Health and Safety: Specific Rules for Certain Products
- Pharmaceuticals - Regulated under the Medicines Act 1968
- Electronic equipment - Subject to the Waste Electronic and Electrical Equipment Regulations 2006 (see also the amending regulations)
- Food - Subject to the Food Safety Act 1990 and related regulations
- Products are subject to the CE marking regime.
Health and Safety: The Regulation of Toys
The general standards of the Toys (Safety) Regulations 2011 are listed below:
- Toys must not jeopardise the safety or health of users or third parties when they are used as intended or in a foreseeable way, bearing in mind the behaviour of children.
- Information about the inherent hazards and risks of harm involved in using the toy and the ways of avoiding those hazards and risks must be marked on toys (or their labels or packaging)
- Any instructions accompanying the toy, must be preceded by the word “Warning” or “Warnings”, and must be marked in English in an understandable and visible manner.
- Distributors must act "with due care" in relation to the compliance with the TSRs' requirements, and must not make a toy available if they have reason to believe that the toy will not comply with the essential safety requirements during its normal and foreseeable period of use.
It's legally astute to make sure you are disclosing certain categories of information to your customers.
If you are selling goods online via your website, and you intend to have no face-to-face contact with your customer before purchase, you will have to comply with 'The Consumer Protection (Distance Selling) Regulations 2000', more commonly referred to as the 'distance selling regulations'.
You must notify your customers, in good time before purchase, in a clear and comprehensible manner, all of the following:
- Your company's identity, physical address and email address
- A description of your goods or services
- The price of your goods or services, including all taxes
- Any delivery costs
- The arrangements for payment, delivery or performance
- Information regarding your customer's right of cancellation
- Your VAT number (if you are VAT registered)
- The period for which any offer or price remains valid
- Where appropriate, the minimum duration of the contract, in the case of contracts for the supply of goods or services to be performed permanently or recurrently
- State if you are unable to provide substitute goods or services (as the case may be) of equivalent quality and price
- State that the cost of returning any such substitute goods to the supplier in the event of cancellation by the consumer would be met by the supplier
Product Descriptions and Product Photographs
- The Sale of Goods Act 1979 Section 13(1) denotes that product descriptions must be accurate and correspond with the product.
- The Consumer Protection from Unfair Trading Regulations 2008 prohibits "unfair commercial practices".
- Further, a "misleading action" or "misleading omission" will constitute an unfair practice.
Categories of information that must be disclosed:
- All commercial online sellers are required to make certain disclosures under The Electronic Commerce (EC Directive) Regulations 2002 (the Ecommerce Regulations).
- Those selling to consumers (as opposed to businesses) must make additional disclosures under The Consumer Protection (Distance Selling) Regulations 2000 (the Distance Selling Regulations).
- Those using "business names" or operating through companies must disclose information about their businesses and companies under the Companies Act 2006 and The Companies (Trading Disclosures) Regulations 2008.
- Almost all online sellers collect and process personal data, and this means they need to comply with the disclosure requirements of the Data Protection Act 1998. More on this below.
Data Protection Act disclosures
The basic information that needs to be provided to website users under the Data Protection Act 1998 is:
- The identity of the person in control of the data
- The purpose or purposes for which the data is intended to be processed
- Any further information which is necessary
I hope the above resources will be of help to you when planning your website and making adjustments changes to your online shop before publishing it to the web. If you have any questions, why not talk to other experienced business owners on the Create Community Forum (login required) or ask a question in the Create HelpCentre?
The information contained in the above writing is not a comprehensive legal checklist. The information above is a brief summary for those to consider before making their website live, and whilst trading via their e-commerce website. All laws covered refer to UK and EC law. We accept no liability for any reader acting upon the guidance contained in the above writing whatsoever. The above is merely a help aid aiming to steer e-commerce traders in the right legal direction. For official legal advice please see a solicitor.