Hi, this is our series on how to lawfully run a business. Today, you will learn about five legal mistakes to avoid in your e-commerce business.
In e-commerce business, the most typical legal mistakes are:
Selling before registering business
Not using or using just copied templates of terms, conditions, privacy policies etc.
Not addressing intellectual property issues properly
Ignoring tax and customs regulations
Making empty promises
Let’s solve all of them!
How to make sure you are registered in all applicable jurisdictions?
In most countries, you need to register your business before starting to sell. Some industries require additional permits, e.g. to sell alcohol, medication or provide licensed service.
Also, there may be laws specific for your target market. For instance, if you target European customers, you need to apply their consumer and privacy laws and hire a GDPR representative for the EU. Make sure you know all entry requirements before starting to sell.
What terms, conditions and privacy policies should you use?
Define what are your conditions. What is the price, what is included, what is not covered, what are your returns and warranty policies etc. Compare them with legal requirements and choose optimal solutions. Don’t rely on templates – these documents will be binding to you and your client, so you need everything to match realty.
How to protect your intellectual property rights?
Before you sell works of others, double-check if you are authorized – otherwise you risk a lawsuit. Copyright contracts should have a proper form: often, online forms or e-mails are not sufficient to transfer copyrights on you.
Also, protect your intellectual property. Register with a trademark agency, such as EUIPO and check for protection offered by platforms where you sell. Include adequate provisions in contracts with your partners, employees, and consumers.
How to comply with tax and customs regulations?
First step to get compliant is to never ignore tax and customs regulations. E-commerce means all transactions are registered. The buyer might require a proof that the goods have been lawfully imported. If you do not plan in advance, it can quickly backfire.
How to avoid making empty promises?
With virtually anything you offer, there might be issues – such as software not working, undelivered mail, faulty product, size does not fit etc. Usually, handling them is your duty. Before you start to sell, read your offer and conditions once again. List everything that can go wrong – do not sell unless you know how to solve those problems.
What were other legal issues you struggled with? Leave a message & let us know your questions.