e-Commerce

Start-Ups and E-Commerce
While online shopping has become prevalent due to its ease and convenience, many are still unaware of how they are impacted by laws governing e-Commerce. These laws have implications on both the online buyer and the online seller and are of particular importance to a start-up company that engages in e-commerce and operates largely online.
Seller Information
When a purchase is made online, the seller and the buyer are entering into a contract. In order to enter into the agreement, the seller must provide the buyer with certain information regarding the business to allow the buyer to make a fully informed decision when purchasing a product or service. The necessary information is as follows:

• The seller’s business name, address, and phone number;
• The seller must describe what they are selling;
• A breakdown of the costs associated with the purchase must be provided separately before being combined into a cumulative cost;
  • Ex. the costs of shipping, the costs of the product or service, taxes, duties, etc.
• The currency that is being used;
• The method of payment required/accepted;
• The sellers’ policy regarding returns, exchanges, or cancellation of orders;
• Details regarding how and/or when the product is to be delivered or the service is to be commenced; and
• Any other conditions of sale the seller has.[1]

The above information should be presented on the sellers’ website in a way where it is easily discernible by the buyer. Furthermore, the buyer should have the ability to print the information for later reference and their own records.[2] Based on this information, the buyer may choose whether they wish to enter into an internet sales contract with the seller.
Finalizing the Internet Sales Contract
Before finalizing any agreement, the sellers’ website must be designed to allow the buyer to correct any errors that may arise in the course of making their purchase.[3] An example of such an error is the buyer choosing to purchase two units of a product when it was their intention to purchase one. Before completing the transaction, the buyer should be provided with a summary of the transaction allowing them to recognize their error and make the necessary corrections before completing their order. If a buyer was not provided with the opportunity to review their order for errors prior to the transaction being finalized, this may provide them with cause for the cancellation of the order upon receipt, so long as this is done within a reasonable amount of time.
Once the internet sales contract has been finalized and entered into by the buyer, the seller must provide a receipt of the transaction. It is acceptable for this receipt to be provided by e-mail to an e-mail address provided by the buyer. The receipt should contain the buyers name, the date the order was placed and should be provided within 15 days of when the order was placed.[4]
Right of Cancellation
In addition to the right to cancel where an opportunity to review the order prior to completion was not provided, there are other situations where a buyer may cancel an internet sales contract. A buyer may cancel an internet sales contract any time prior to the commencement of the services or delivery of the goods if:

• Goods have not been delivered within 30 days of the delivery date provided;
• Travel, transportation, or accommodation services have not commenced on the date provided; and
• For all other services if the services have not commenced within 30 days of the date provided.[5]

Where a specific delivery date or commencement date for services  has not been provided, cancellation may occur where the delivery or the service has not been provided within 30 days of the date the contract was entered into.[6]
If the buyer wishes to cancel for any legitimate cause, they must do so by providing notice to the seller.[7] If the buyer fails to communicate cancellation to the seller despite having legitimate cause such as the examples discussed above, the contract will not be cancelled. Methods by which a buyer may cancel an agreement with a seller include mail, e-mail, phone or fax.[8] Keep in mind that the buyer must be able to prove what day they requested the cancellation. The date will be relevant in determining whether the cancellation was justified.

Richie Aujla is a member of the BLG Business Venture Clinic, and is a 2nd year student at the Faculty of Law, University of Calgary

References
[1] Alta Reg 81/2001, s 4(1).
[2] Ibid, s 4(2).
[3] Ibid.
[4] Ibid, s 5.
[5] Ibid, s 6(2).
[6] Ibid, s 6(3).
[7] Ibid, s 8(1).
[8] Ibid, s 8(3).