Designing and launching an online business is an exciting time for any business.
When launching your online business, and connecting customers with suppliers, you will likely be focusing on building out your business model and deciding payment options.
However, it is also important to think about the legal documents that you need to run your business.
Not having the right documents in place could have consequences in the long run if you get into any legal disputes.
Because the internet might seem like the wild west – but don’t be fooled.
The long arm of the law still applies
In this article we explain three key documents that your online business needs:
- terms and conditions;
1. Online Terms and Conditions
Your terms and conditions document is the contract between your business and the people who use your website to arrange transactions.
It sets out the rules for how you trade, what you’ll tolerate and what you’ll give.
This document will be crucial for your business, as it will outline the sale and purchase process between users.
When you operate an online business, you enter into legal relationships with multiple parties.
Therefore, you need specific terms and conditions.
For example, online marketplace Airbnb enters into legal relationships with:
- the homeowners;
- property managers; and
- people who are looking to stay in the properties.
As a marketplace operator, you have options on how you can work with other parties.
You may just wish to provide an introductory service and leave the parties to sort out the payment on their own.
Alternatively, your marketplace may offer everything the parties need for the transaction to occur.
Clearly outlining this role is crucial as you can then also outline your legal responsibility if something goes wrong between the parties.
If you don’t clearly specify this, you might have to pay for damage that was caused by another party.
Specific key terms need to be covered in your business terms and conditions, including:
- account registration;
- how customers interact with suppliers;
- payment processes;
- return, refund and exchange policies;
- consumer guarantees;
- dispute resolution;
- indemnities; and
- the limitations of your legal responsibility.
It’s also important to remember that different rules apply for sales to businesses v consumers…
So, you need to ensure you have the right terms and conditions in place.
Check out our guide on doing business with consumers to find out more.
However, this document is crucial as it outlines how visitors can use and interact with your website.
Not everyone who visits your website will sign up to use your marketplace or become a paying customer.
- use of the website;
- intellectual property protection; and
- limitations of your legal responsibility.
Therefore, if anyone who visits your website breaches any of these terms, you will be legally safeguarded and can take action against them to protect your business.
By law, you must have one of these in place on your website.
When customers and suppliers interact with each other on your marketplace, they will likely be submitting personal information to you.
- what information you collect;
- how you collect it; and
- what you do with it.
You should also make it clear to customers that they can view or correct any data you hold about them.
They offer transparency with your customers and can help minimise disputes down the track.
This is because they can protect your business by limiting your legal responsibility if issues arise.
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***Disclaimer. Please read!!***
This article is for general information purposes only and should be used solely as general guidance. It does not and is not intended to represent legal advice or other professional advice.
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