b Consumer Protection
It is important to understand that consumer law applies to electronic contracts in the same way as it does to non-electronic contracts, and that the Director of Consumer Affairs, as well as the courts, has the same powers in relation to these electronic contracts as it does with non-electronic contracts.

In practical terms, this means that when dealing with consumers - customers who are not buying in the course of their business - the use of disclaimers or limitations of liability clauses may not be legally effective, in the same way as these are not always effective in non-electronic transactions.

In addition, consumer protection has been greatly strengthened since 2001 through European Communities regulations governing 'distance contracts'. A distance contract is defined as:

• Made between a supplier (in the course of running a business) and a consumer
• Made under an organised distance sales or service provision scheme run by the supplier, and
• For which the supplier has made exclusive use of one or more means of distance communication up to and including the moment at which the contract is made.

In essence the law applies when a contract is concluded without the simultaneous physical presence of the supplier and the consumer.

This covers most types of agreements concluded over the Internet, but specifically excludes contracts for financial services, which are regulated separately (see next page). The effect of the regulations is that a distance contract will not be enforceable against a consumer if detailed information about it is not displayed to the consumer before the order is placed.

A consumer cannot waive the rights conferred on him or her by these regulations. This means that even if he or she signs up to a contract which limits these rights, that part of the contract will be deemed to be unenforceable.

If you are selling through a website, the terms and conditions of the contract need to be prominently displayed on the site, in a manner which can be accessed at all stages when a consumer is ordering from you (see example in interactive graphic).

The minimum information which must be provided includes:

• The identity of the supplier and, in the case of contracts requiring payment in advance, the supplier's address
• The main characteristics of the goods or services
• The price of the goods or services, including all taxes
• Delivery costs, where appropriate
• The arrangements for payment, delivery or performance
• The existence of a right of cancellation, subject to certain conditions
• The cost of using the means of distance communication (eg, the phone call), where it costs more than the basic rate
• The period for which the offer or the price remains valid
• The minimum duration of the contract in the case of contracts for the supply of goods and services to be performed permanently or on an ongoing basis

The best way to ensure that consumers are made aware of the terms and conditions of the contract is to include a mechanism that forces customers to scroll through these terms and conditions prior to conclusion of the contract, and then click on a button signifying that they have read and understood them (see example in interactive graphic). This 'acceptance' should then be recorded, allowing you to avoid any contention at a later date that the customer was not aware of the terms and
conditions.

A distance contract is unenforceable against a consumer unless you have written to that consumer - an email will suffice - setting out not only the minimum information above, but also:

• Information on the right of cancellation within a period fixed by the supplier, but which cannot be less than seven days
• The geographical address of the place of business of the supplier to which the consumer may address any complaints
• The conditions for terminating the contract if it is of unlimited duration or longer than one year
• Information on the after sales services and guarantees that apply. If the contract is with an Irish company, this information will be set down in the Sale of Goods and Supply of Services Act, 1980. If the contract is with a company outside Ireland then, in general, the rules that apply are usually subject to legislation in that country, which should be laid down in the contract.

This is known as the 'confirmation information', and must be given to the consumer during the course of the contract or, at the very latest, when the goods are delivered. In reality, the best way of dealing with this is to send out an automatic email, containing all this information, to consumers who have placed an order with you.

Consumers have an automatic seven-day "cooling-off" period in which to cancel a distance contract without reason. The supplier can offer a longer period. The only costs which consumers will have to pay as a result is the cost of returning the items in question. This period starts when the goods have been received or, in the case of services, on the date the distance contract is concluded.

Be aware, however, that although the regulations give consumers a right to cancel a contract without reason, they do not specifically state that a consumer needs to return the goods if he or she decides to cancel. It is wise, therefore, to include a provision for return of the goods on cancellation in your terms and conditions.

Remember also that if you haven't provided the consumer with the 'confirmation information', this cooling-off period is extended for up to three months. This allows consumers, without reason, to return goods to you some three months after they have been received and is clearly not something which any business will want.

This is one area in which online trading differs from 'over-thecounter' transactions. A consumer who purchases a good in a shop does not always enjoy the right of return for goods which are not faulty or defective. Remember also that a consumer who returns a good under this 'cooling-off' period is entitled to a full refund, less the cost of returning the goods.

The right of cancellation does not apply in certain circumstances. These are:

• Where the goods in question are customised or perishable
• Where the price of the goods or services is subject to fluctuation, eg online share trading
• Where the goods in question are newspapers, magazines or periodicals
• Where the goods in question are audio or video recordings, or computer software which was unsealed
• In gaming or lottery services
• For services, the performance of which has begun with the consumer's consent before the end of the cooling-off period

The cooling-off period does not apply to contracts for

• Transport
• Accommodation
• Catering or leisure services provided on specific dates

The supplier must fulfil the order within 90 days and, if the goods are out of stock, then the customer must be informed and given a refund within 30 days. A person who fails to comply with the regulations set out above is liable to a fine of up to €3,000, and the Director of Consumer Affairs can apply to the High Court for an order to force compliance.

Related Links

Learn more about consumer rights when buying online

Read advice for consumers from the Director of Consumer Affairs