Top 4 legal considerations for online business.

23 April 2020 | Reading time: 2 minutes

In this new era of COVID-19, online business is more essential than ever. Whether an established online business or a new online player, here are 4 key legal considerations for optimising online operations.

1.     Choose your terms wisely.

Terms of use and trading terms are not one size fits all. They will define the arrangement with your customers or users, reduce risks and limit liability.

Carefully consider whether new agreements could be affected by COVID-19 and whether existing rights and obligations have been frustrated or otherwise affected by a force majeure event.

2.     Privacy is paramount.

If your online business collects personal information from its customers or users, Australian privacy laws may apply. This depends on the size and nature of your business.

The Privacy Act 1988 (Cth) sets out obligations regarding management of personal information. This includes setting out privacy information and procedures in a privacy policy.

Even if your business is not subject to privacy laws, developing an online privacy policy is recommended. Consumers expect transparency about how their personal information will be handled and protected. Remember to regularly revisit and update your privacy policy as your online business evolves.

3.     Comply with consumer laws.

The Australian Consumer Law (ACL) may affect several areas of your online business, including:

  • advertising;
  • product claims;
  • returns and refund policies;
  • standard form consumer contracts; and

In a series of previous posts, we looked at whether price gouging during COVID-19 could amount to unconscionable conduct or a false or misleading representation under the ACL.

Consequences for breaching the ACL can be severe and harmful for your business and goodwill. Therefore, it is critical to understand your rights and obligations in relation to customers, particularly during the COVID-19 pandemic.

4.     Understand your IP rights.

Running an online business inevitably involves the use or creation of intellectual property and it’s important to understand your rights and restrictions.

When engaging third parties (such as developers, designers or other contractors), check the contract carefully to understand which party will own the resulting intellectual property. Negotiation of ownership or licensing rights is critical.

Avoid publishing photos, text or other media online, that your business does not own or have a licence to use, to ensure you do not infringe third party intellectual property rights.

Stay alert to legal issues.

As we settle into life with COVID-19, it is encouraging to see new online initiatives. However, rapidly changing circumstances make it important to stay vigilant about the legal issues affecting online business.

Need more information? Contact us or register here to join one of our free daily legal Q&A sessions for businesses affected by COVID-19.

For details of all of our COVID-19 tips and updates, visit the Bespoke COVID-19 Hub.