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advice - e-commerce


Improving your bottom line

If you have spent a considerable amount of time and money developing a good website it makes sense to ensure that it complies with all of the relevant regulations. There are a number of reasons for this:

  • It's the law
  • Your customers are more likely to buy
  • Your customers will have more confidence in your product or service
  • Knowledge is power and this will allow smaller businesses to punch well above their weight

There are three items of regulation that are particularly relevant to UK businesses trading online:

  • The Data Protection Act 1998
  • The Consumer Protection (Distance Selling) Regulations 2000 as amended by the Consumer Protection (Distance Selling) (Amendment) Regulations 2005
  • The Electronic Commerce (EC Directive) Regulations 2002

To comply with the above is not too onerous: the regulations are generally sensible and practical; you just need to read through the information and apply it. There are some modest costs, but these are tiny in relation to the likely scale of business, and the possible consequences that could conceivably follow non-compliance. These regulations are described below in more detail.

The Data Protection Act 1998

If you collect information about people (employees, customers, visitors etc), such as names, addresses, phone numbers etc then this applies to you. Clearly, this includes any business irrespective size.

Key points to note:

  • You must state what you do with the data (and stick to it). Although you do have the facility to add multiple data templates at the point of application
  • You must register with the Information Commissioner, a government official that oversees Data Protection
  • You should not export the data outside the EC without the subject's permission
  • You must keep the data secure, reveal it and delete it if requested by the subjects

These obligations are straightforward, mandatory and the cost of registration is £35 per year. For further information about the Data Protection Act and the role of the Information Commissioner visit the website at Information Commissioner. To register with the Information Commissioner go to Data Protection Register. If you are collecting your information from your customers and you are registered, then it may help you to make this point clear on your publicity material or web sites.

The Consumer Protection (Distance Selling) Regulations 2000 amended by the Consumer Protection (Distance Selling) (Amendment) Regulations 2005.

If you sell online, by mail order or by telephone to consumers, then this applies to your business. These regulations do not apply to business to business transactions.

Key points to note:

  • You should provide clear information about your offering before purchase (no extras like tax and freight after the consumer has decided to purchase). It is helpful to be very clear what your freight charges are and whether prices include VAT to avoid doubt
  • You should provide a written confirmation of order following purchase
  • There is a "cooling off" period of 7 working days for most goods (exclusions could include perishable or digital goods). You should inform the customers of their right to cancel (without charge, other than return freight)

We recommend you read and act on the fact sheet published by the Department of Trade and Industry at:

Distance Selling Fact Sheet

You can read the full text of the regulations on the Office of Public Sector Information (OPSI) website at:

The Consumer Protection (Distance Selling) Regulations 2000 and The Consumer Protection (Distance Selling) (Amendment) Regulations 2005.

The Electronic Commerce (EC Directive) Regulations 2002, Commonly referred to as the Ecommerce Directive.

If your business operates online using the web or your business communicates using email, this applies to you. The Directive applies to both business to business (B2B) and business to consumer (B2C) relationships.

Key points to note:

  • You should display the name of your business
  • We recommend you display your company registration number or proprietor's name (as you would in a letter)
  • You should show your geographic address (street number etc, not just a PO Box)
  • You should show your contact information such as phone number and email address
  • You should show your VAT number if you are VAT registered
  • Refer to trade or professional recognition schemes, with registration number, if applicable
  • Provide clear information on price, tax and delivery
  • Show clear Terms and Conditions and acknowledge orders

We recommend you read and act on the guidance notes published by the Department of Trade and Industry, available in PDF format at: Ecommerce Directive Guide. (requires Adobe Acrobat reader). You can read the full text of the directive on the OPSI website at: Electronic Commerce (EC Directive) Regulations 2002.

Additional Information

The information above and documents (listed on this page and elsewhere on the website) should help a large number of businesses develop and improve their online capability. If you are looking for further information you may wish to consult these resources:

DTI - background information about communications from the Department of Trade and Industry

British Chambers of Commerce - your local chamber can provide advice or connect you with people that can help

Business Link - the Government enterprise agency dispenses information and advice from a network of UK offices and has an ecommerce section on its website.

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