Doing Business in the Information Age John Corker GENL0230 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 ► Intention to 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 ► Inferred from 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 ► Identity and 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-parties free to agree on method ► Production and retention of documents  Method must ensure integrity and accessibility ► Time and 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 ► Joint sharing and several liability ► Fiduciary duties to partners Companies ► Corporations ► Artificial Act legal entity ► Liability of members can be limited Companies ► Constitution ► Directors ► Limits duties on raising money from the public Companies ► The “corporate veil” ► Lifting the 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