Chapter VII of the ECT Bill is good news for consumers buying from the Internet and bad news for online merchants.

Let's use the example of Joe Soap (consumer) buying a book from Onlinebooks.co.za (supplier). Firstly it must be noted that a consumer is defined as "any natural person who intends entering into an electronic transaction with a supplier of goods and services as the end user of such goods and services". This means that B2B marketplaces and sales to companies are excluded from these provisions. Also, the definition implies that the consumer has the protection of these provisions notwithstanding the fact that a final transaction took place - this is an important consideration for the supplier in deciding what changes should be affected to its web site in order to comply with this Chapter VII.

In the simple scenario detailed above Joe Soap has the following rights and Onlinebooks the following duties:
Joe Soap has the right to 18 pieces of information prescribed by the Bill. These range from the address details of Onlinebooks to manners of payment and return policies. In our opinion the best place to include this information is in the "terms of use" on the web site of Onlinebooks. These "terms of us" should be available as a hyperlink from every page of the Onlinebooks site. The safest option is to allow a consumer to click on "I agree to the terms of use" before being allowed to finalise any transaction.

Joe Soap must have the right to review, correct and withdraw from the entire transaction. We suggest that this opportunity should be allowed just before the consumer submits his/her credit card details.

Joe Soap has a right to transact with a web site that is sufficiently secure. This duty on the supplier should be read with the King II Report that place the liability of security failures on the shoulders of the directors of Onlinebooks. The Act also states that Onlinebooks shall be liable for any damages caused to Joe Soap because the site wasn't secure e.g. disclosure of personal or credit card detail.

Joe Soap has the right to the so called "cooling-off" period. This means that he may cancel the transaction 7 days after receipt of his book. If so, Onlinebooks may only recover the cost of returning the books and must refund him within 30 days. Note that the cooling-off provision does not apply to financial services, auctions, foodstuffs, video and audio recordings, computer software, lotteries and gambling services. We suggest that supplier should detail how this duty will be managed and send am e-mail to the consumer once the 7 days have lapsed.

Joe Soap has the right to receive his book within 30 days from the transaction and may cancel the transaction if that doesn't happen.

If Onlinebooks wish to send further e-mails to Joe Soap on new offers, Joe Soap must be given the opportunity to "unsubscribe" from the Onlinebook mailing list. The right not to receive spam should be read with the privacy protections of Chapter VIII as it might have a significant effect on the CRM architecture, calls centre and workflow of Onlinebooks.

Section 48 states that the consumer protection provisions apply "irrespective of the legal system applicable to the agreement in questions". This means that Onlinebooks cannot state that their web site and agreements are governed by the laws of, lets say Afghanistan, to find a way around these provisions. However, it also implies that foreign businesses doing business with South Africans must comply with the provisions of Chapter VII. Will these provisions be to onerous for the Amazon's of this world - they may even decide to ban all South African consumers from their sites... only history will tell!

Reinhardt Buys is a partner at Buys Incorporated, a law firm specialising in internet, media and intellectual property law. Click here to visit their site.

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