What is e-commerce?

Includes:
► Online business to business transactions
► Online business to consumer
transactions
► Digital delivery of products and services
► Online merchandising
► Automated telephone transactions eg
phone banking
► EFTPOS and other automated transfer
systems
 Contracts

►Law of contracts
►Issues for e-commerce
 Contracts - the basics
► Offer
► Acceptance
► Intentionto enter legal relations
► Consideration
► Legal capacity
► Genuine consent
 Offer

► Clear statement of terms

► Person who makes it is prepared to be
bound
► Not just an “invitation to treat”
 Acceptance

► Unqualified agreement to terms of offer

► Express or inferred by conduct
► Can’t be forced on unwilling person
 Time of creation of contract

► Contract
formed at time and place the
acceptance is communicated to offeror
 Termination or
revocation of offer

► Can be revoked prior to acceptance

► Revocation must be communicated to
offeror
 Certainty

► Essential parts of contract must be clear and

complete
► Courts may imply a meaning
► Uncertain term can be “severed”
 Consideration

► Valuable consideration
► Passing between parties to contract
► Can’t be unlawful or immoral
 Intention

► Express
► Inferredfrom the circumstances
► Must be genuine consent - not obtained
under duress
 Capacity

► Age
► Intellectual capacity
 Terms and conditions

► Express
► Implied
 Formalities

► Oral or written
► Writing required under statute eg for sale of
land
 Practical concerns
for e-commerce deals
► Identityand capacity of seller or buyer
► Authenticity of offer and acceptance (digital
signatures)
► When and where contract formed
► Governing law
► Terms and conditions (click through)
 Practical Concerns for
e-commerce deals(2)
► Agreement on electronic payment system
► Security of information exchanges
► Consequences on breach
► Storing electronic data to prevent alteration
 Electronic Transactions Act
► Federal law with mirror State laws (NSW,
VIC, WA)
► To remove obstacles to electronic
transactions, communications, signatures
and record keeping
► 1 July 2001 applies to all federal laws unless
exempted
 Electronic Transactions Act(2)
► Validates electronic transactions
► Given in writing met electronically now
 Govt can specify technology requirements
 Business requirement valid only with consent
► Signatures-partiesfree to agree on method
► Production and retention of documents
 Method must ensure integrity and accessibility
► Timeand place of dispatch and receipt of
communications
 Electronic Transactions(3)
 Time of dispatch is when it enters the first
information system outside control of sender
 Time of receipt is when it enters an
information system designated by the
addressee for receiving it.
 Place of dispatch and receipt taken to be
respective places of business
 Electronic Transactions (4)
► Record keeping OK electronically if law
says:
 Information to be recorded in writing
 A written document to be kept
 An electronic communication to be kept
► Records must be kept identifying origin,
destination, time of sending and receipt of
electronic communication
 Making a contract

► What terms do you want to include?

► What risks are you trying to avoid?
► How will disputes about contract be dealt
with?
► What is the governing law?
► Who will sign it?
 Setting up a
business entity

► Sole trader
► Partnership
► Company
► Trust
 Sole trader
► All profits
► All losses
► All liabilities
► Own name or choose business name
► Register business name
 Partnership
►Carrying on a business
►In common
►With a view to profit
►Established by written agreement, oral
agreement or conduct
 Partnership
► Partnership Act 1892 (NSW)

► Corporations Law: Not more than 20

partners (except doctors, solicitors and
accountants)
 Partnership
► Profit sharing

► Joint and several liability

► Fiduciary duties to partners

 Companies
► Corporations Act
► Artificiallegal entity
► Liability of members can be limited
 Companies
► Constitution

► Directors duties

► Limits on raising money from the public

 Companies
► The “corporate veil”

► Liftingthe veil: fraud, agency, paying more

dividends than profit, incurring debts when
company insolvent
 Companies
Form a company by:
► Registering name
► Lodge application with ASIC
► Registered office
► Names of directors and members
 Which structure?
► Where are you getting your money from?
► What is your risk/liability?
► Who will be in control?
► What are the ongoing costs?
 What is a domain name
► Human friendly form of an Internet address
► Actual address is an Internet Protocol (IP)
number
► System globally administered by ICANN
► Generic top level domains (gTLDs)
 .com, .org, .net, .edu, .gov, .biz
► Country code top level domains (ccTLDs)
 Domain name registration
in Australia
► open and closed domains
► open - .com, .org, .net, .info, .biz
► closed - .gov, .edu, .mil, .museum
► auDA administers .com.au space
► to register in .au space must be a
commercial entity registered and trading
in Australia..
 Domain Names (cont)
► Licensed on a first come-first served basis
► Domain Names never meant to confer
property rights.
► Clash with Trade Marks.
► auDA has a dispute resolution scheme
which applies to all domain names
registered or renewed from 1 August 2002.
► ICANN has the UDRP for .com etc domains.
 Domain Names and other
business identifiers
► Trade Marks
► Personality Rights
► Place Names
► Tension with domain names
 Reverse domain name hijacking
 cybersquatting