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Just another WordPress.com weblogSnap Shot of the Trade Practices Act (Cth)and Fair Trading Act re on-line trading
Trading Practices Given the on-line trading facility is accessible and operating in Australia, consideration also needs to be given to specific trading practices. Namely, the Trade Practices Act [1] (TPA) various state Fair Trading Acts [2] (FTA) dealing with consumer protection, inter alia, prohibits trading conduct in Australia which is, or is likely to be, misleading or deceptive. This includes making false claims about products or creating a situation where consumers are liable for unsolicited products. The effect of the TPA and FTA also recognises foreign companies that engage in commerce (on-line trading) in Australia[3]. The TPA as does the various FTA equivalents, provide for a number of implied warranties which can not be ousted by exclusion. Effectively this means the on-line business is subject to these requirements. These include that the product must be of merchantable quality[4], fit for the purpose for its use[5], match the description and quantity as promised[6] and be free from defects[7]. The remedies for breaching such legislative requirements usually takes to form of repair, replacement, refund or credit and the effect of the TPA can not be ousted[8].
[1] TRADE PRACTICES ACT 1974 – SECT 52 (Cth)
[2] For example – FAIR TRADING ACT 1987 – SECT 42 (New South Wales)
[3] TRADE PRACTICES ACT 1974 – SECT 4 DEFINITION OF “FOREIGN CORPORATION” AND REFERENCE SECTION 52.
[4] TRADE PRACTICES ACT 1974 – SECT 71(1)
[5] TRADE PRACTICES ACT 1974 – SECT 71(2)
[6] TRADE PRACTICES ACT 1974 – SECT 70 AND 72
[7] TRADE PRACTICES ACT 1974 – SECT 52
[8] TRADE PRACTICE ACT 1974 – SECT 68
Electronic Commerce Internationally and in Australia – Commentary
Electronic Communications The operation of the on-line business comes within the meaning of electronic commerce by virtue that such a transaction has the functional equivalence of conventional paper based commerce but utilising Electronic Communications[1]. The law of contract remains established in Australia despite developments[2] in the contracting process, thus it is the mechanism of contracting by Electronic Communications rather than the conventional paper based process and the issue of an enforceable contract, which underscores the operations of the on-line facility.[3] At the onset, the United Nations Commission on International Trade Law (UNCITRAL) model law sets out a number of Articles dealing specifically with electronic Commerce[4]. These model laws have been drawn upon to formulate the relevant legislation for electronic commerce in Australia, namely the Electronic Transactions Act, ibid, which in turn has been adopted in the various Australian States and Territories. Each jurisdiction within the Commonwealth of Australia generally works in the same fashion however there are a limited set of exemptions in each jurisdiction [5].The Electronic Transaction Act is technology neutral and provides for electronic transactions to be equal to transactions of a paper based process with respect to legal significance. In other words a transaction is not invalid by use of an electronic communication[6]. The initial purpose of the legislation was for the benefit of Government undertaking business electronically. This has permeated into the mainstream commerce through the Electronic Transactions broader application. By virtue of the Electronic Transaction Act, provision is made for a number of additional aspects of electronic commerce that without the legislative recognition may otherwise frustrate the application of the legislation as intended. These include: · That a transaction is not invalid because it was undertaken by electronic means, ibid.· In the event a signature of a person is required this can be provided electronically on the basis that there is the ability to identify the signatory and their approval. The process is reliable and the party receiving the signature consents[7]. · Document management, that is, the electronic document can be produced in the event that a paper version would be required to be produced[8]. · That the retention and recoding of a document can take place in an electronic format [9]. · Electronic communication take effective at the addressee’s place of business or ordinary residence and generally once the acceptance of an offer is received then the contract is prima facie created[10]. The result of Electronic Transaction Act gives rise to the on-line mechanism which in turn can lawfully create a contract. The contract arises via the on-line portal by virtue of the parties evidencing, by electronic means, they both intend to create and be bound by a contractual relationship where the elements of contract law are satisfied, namely, that offer, acceptance and consideration, inter alia have been met.[11] In the development of the on-line mechanisms, electronic communications such as email, interactive electronic forms or attachments, interactive database and agents or website facilities (which posses a degree of automated processing) and click-wrap agreements, are all valid and will form an important consideration in the development of the web portal. [12]
[1] ELECTRONIC TRANSACTIONS ACT 1999 Part 1 Section 5 – Definitions
[2] McGuren v Simpson[2004] NSWSC 35 and Lockheed – ARABIA V Owen [1993] 3 ALL er 641 which talk about the notions of “accommodating technological change”
[3] Forrest v Verizon Communications, Inc 805 A 2D 1007 (D.C 2002)
[4] United Nations Commission on International Trade Law (UNCITRAL) - convention on the use of electronic communications in international contracts, adopted Nov 2005 signed June 2006
[5] “Fantastic Beasts and where to Find Them” – A guide to Exemptions in the Electronic Transactions ACT (ETA) in Australia ( Sept 2004) – Galexia consulting Pty Limited with a number of contributors as cited on the paper.
[6] ELECTRONIC TRANSACTIONS ACT 1999 – SECT 8
[7] ELECTRONIC TRANSACTIONS ACT 1999 – SECT 10
[8] ELECTRONIC TRANSACTIONS ACT 1999 – SECT 11
[9] ELECTRONIC TRANSACTIONS ACT 1999 – SECT 12
[10] ELECTRONIC TRANSACTIONS ACT 1999 – SECT 14 see Szaeg v Minister for Immigration [2003]FMCA 258.
[11] This reflects the established principles of Contract Law – for commentary see Carter, J & Peden, E, & Tolhurst G J, Contract Law of Australia, LexisNexis: Sydney (5th ed, 2007).
[12] ELECTRONIC TRANSACTIONS ACT 1999 – SECT 8
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