Published by: Glen Falting and Amy Saunders, Support Legal.
Pro-Tips for E-Commerce Startups: Website Ts&Cs
In the world of startups and e-commerce, website terms and conditions (Ts&Cs) often form the basis of the contract between the business and customer. Having a set of clear and easily understood Ts&Cs protects you and your customers and reduces the potential for disputes. There is more involved in producing Ts&Cs than simply scraping them from the website of a competitor!
In this guide, we will discuss the key issues to consider and provisions to include in your website Ts&Cs. Please note the Ts&Cs being discussed here are those that form the contract between you and your customer. These are more detailed and separate from the shorter and simpler ‘user terms’ that often appear at the bottom of a webpage and which apply generally to people visiting the webpage.
Understand Your Client-Side Risks
A major reason for having Ts&Cs is to manage your business risk. Start developing your Ts&Cs by mapping out the complete transaction life-cycle (including all possible variations and outcomes) of your customer engagement and product delivery processes. Add to this, the critical risk points around your product’s value proposition and regulatory exposure. Use this process to identify the various risk points on the client side of your business so that these can be addressed in your Ts&Cs. By being clear about the rights and obligations of both parties to a transaction (i.e. you and your customer) you can greatly reduce the risks to your business and the potential for contract disputes.
Define Your Services and Expectations re Use
Your Ts&Cs should include clear and concise information about the nature of your business, your products, and services. This section must provide crucial information like the scope of services, user restrictions, and any prohibited conduct. It should also include details about the account registration process, customer eligibility criteria, and obligations of the parties.
Intellectual Property Rights & Content
The intellectual property rights section is one of the most crucial provisions in the Ts&Cs of your website. It defines the ownership and usage rights and restrictions in relation to content uploaded on your website. It should state that you own all rights and interests in the content of the website, including logos, trademarks, copyrights, and patents. While the ownership in the customer’s original intellectual property will generally remain with the customer, it is common for e-commerce Ts&Cs to specify all customer- content generated using the platform/product belongs to your business and that you have the right to use or delete it as you deem fit. As a side note, it’s worth including restrictions on uploading certain categories of customer-generated content – such as content that is offensive or infringes intellectual property.
Privacy and Data Protection
Privacy and data protection are becoming increasingly important in today’s digital world. The Personal Data Protection Law (PDPL), for instance, requires website owners to comply with strict data protection regulations. Your Ts&Cs should explain what personal information you collect from your customers and how it is used, stored, and protected. It should also state how customers can manage their data and upload or delete data. Also, you should mention the measures you have taken to protect customer data and assure that you follow all relevant data protection laws.
Payments and Refunds
One of the significant components of any transactional website is the payment gateway. Your website’s Ts&Cs must include a section that outlines the payment process, the accepted payment methods, and any applicable fees. This section should also provide details regarding the refund and exchange policy, including eligibility criteria, timelines, and conditions. You should ensure that customers understand that they are entering into a legally binding agreement by using the payment gateway.
Disputes between customers, or between you and the customers, can arise from customer-generated content, payments, or other matters. Your Ts&Cs should specify how disputes are to be resolved. Alternatives like arbitration, mediation, or litigation can be mentioned with clear explanations of each option.
The termination section of your website’s Ts&Cs should stipulate that, in certain circumstances, you have the right to terminate a customer’s account or access to your website. In case the customer violates the Ts&Cs, your business needs the power to terminate access. Setting out the terms of termination would protect your business in the long run.
Limits of Liability
The limitation of liability section of your Ts&Cs is intended to mitigate the risks that your business may face. You will minimize the risk of lawsuits, damages, particularly in relation to any service disruption or downtime impacting your website. This section should define the liability limits of your business and be expressed in clear and straightforward language
Other important considerations
There are other provisions that it may be worthwhile incorporating in your Ts&Cs, including:
what happens if events occur that are outside your control.
information on how to make a complaint (often helpful as a first point of escalation to mitigate the risk of litigation).
any other business / industry specific information that customers should be aware of.
Your website’s Ts&Cs are one of the most critical aspects of conducting business online. They offer protection to your business and customers and help to minimize risk. This guide has provided a high-level overview of the key issues to consider and provisions to include in your website Ts&Cs, however there is no one size fits all approach, and our team of commercial lawyers are here to anticipate potential risks and guide you.
This material is provided for general information only. It does not constitute legal or other professional advice.