The global nature of the doing online business presents unique and challenging legal issues for an e-business attorney and every internet business owner. The United States Census Bureau reports in 2007, nearly 248 million Americans note they have access to the internet, which is roughly 75% of the overall population in the United States. While these internet business statistics sound staggering domestically, the international market of internet users, including those from the United States, is estimated by various sources to be an exponentially growing number of about 1.5 billion individuals as of 2008. An e-business attorney is well aware of all the esoteric caveats surrounding operating an online enterprise that could potentially be seen by 1.5 billion people representing an estimated 158 different nations. Each of these nations and their individual users’ localities contain differing and unique laws that e-commerce company must be aware of and abide by before targeting individual markets or the global audience as a whole. While the inventiveness and sheer number of individuals using the internet proves highly attractive to savvy business owners, the lacking presence of jurisdiction, among other items to be expounded upon by this article, must be properly addressed in counsel with an e-business attorney.
When an e-commerce site commences business, the website and all its content become a storefront property, albeit virtual in nature. Typically, e-commerce website owners will seek the knowledge and foresight of an e-business attorney in the crucial step of crafting and posting the “Terms and Agreements of Use” of the e-commerce site. This document is integral in minimizing the legal liability a site may have for a number of items associated with operating a business that has no jurisdictional bounds.
Some legal liabilities an e-business attorney will seek to mitigate in a “Terms and Agreements of Use” disclaimer include:
- Intended jurisdiction of the users of the website
- Limitation on liability dispute resolution
- Privacy agreements for transactions
- Acknowledgement agreement of legal right for an individual to engage in e-commerce with a given website
- Preservation of intellectual property rights
- Fraud prevention and statutes applicable to the E-business
- Limitation on liability for errors or technological failures
- Limitation on liability for malicious third party activity
Each e-business website will require a differing, consummate “Terms and Agreements of Use” dependent upon the nature of their business, the jurisdiction of their targeted consumers, and any other applicable federal, foreign, or international laws. Though the internet is seen as a largely unregulated forum of communication and commerce, there are governing agencies internationally as well as domestically in the United States that will prosecute abuses or perceived abuses by e-business websites.
The federal and international organizations that may influence the operation of an e-business website include:
- The Federal Trade Commission
- The Federal Communications Commission
- The Department of Labor
- The United States Department of Justice
- The Securities and Exchange Commission
- The Internal Revenue Service
- State and local commerce regulatory entities
- ICANN, formally known as the Internet Corporation for Assigned Names
An e-business attorney will counsel all company clientele in regards to these entities, as well as the plethora of typical business-related laws in that if violated, could result in criminal or civil penalties. For example, the Federal Bureau of Investigation handled over 75,000 internet fraud cases in the year 2002 alone. If a business is draw into such controversy despite their best efforts to minimize liability with an e-business attorney, an e-business attorney can assess, litigation, and defend all criminal charges or civil suits regarding online commerce disputes. The Federal Trade Commission, while working under the premise of Section Five of the Federal Trade Commission Act, is allowed to monitor almost every aspect of e-business advertising and marketing, which helps prevent fraud in the internet economy, protects consumer’s private and financial information, and monitors for other financial fraud crimes.
Aside from operating a business in an unethical or illegal manner, criminal charges stemming from operating an e-business frequently arise in an unexpected and scary manner for many online company clients. These investigations and charges often arise from unseen tax liabilities that might be missed by business owners not versed in the legal aspects of operating an e-business. Additionally, a number of tax mitigation techniques are applicable when operating an e-business as well depending on jurisdictions and the types of business being operated. Also, disputes over intellectual property rights, over issues ranging from domain name parking to the actual products or services being offered itself on a website, can crop up between businesses. An e-business will counsel clients through all mediation, arbitration, or litigation over intellectual property, trademark, or copyright disputes.
The propensity of retailers and service providers to operate online is increasing. The estimated number of e-commerce sales, according to the Federal Trade Commission in 2007, was $136.4 billion, which was about a 19% increase from the year 2006. These e-commerce sale increases reported by the Federal Trade Commission directly correlate to the 4% increase of retail sales in general that was seen from 2006 to 2007. Integrating a company into the realm of e-commerce and e-business is not a simple task, however, with the assistance of an e-business attorney, companies can seamlessly integrate themselves into the growing range of internet buying and selling.
Do you or your company wish to engage in commerce online? Contact an e-business attorney right away to begin operating online today.