Doing Business in the Information Age

1. Doing Business in the Information Age John Corker GENL0230

2. 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

3. Contracts • Law of contracts • Issues for e-commerce

4. Contracts - the basics • Offer • Acceptance • Intention to enter legal relations • Consideration • Legal capacity • Genuine consent

5. Offer • Clear statement of terms • Person who makes it is prepared to be bound • Not just an “invitation to treat”

6. Acceptance • Unqualified agreement to terms of offer • Express or inferred by conduct • Can’t be forced on unwilling person

7. Time of creation of contract • Contract formed at time and place the acceptance is communicated to offeror

8. Termination orrevocation of offer • Can be revoked prior to acceptance • Revocation must be communicated to offeror

9. Certainty • Essential parts of contract must be clear and complete • Courts may imply a meaning • Uncertain term can be “severed”

10. Consideration • Valuable consideration • Passing between parties to contract • Can’t be unlawful or immoral

11. Intention • Express • Inferred from the circumstances • Must be genuine consent - not obtained under duress

12. Capacity • Age • Intellectual capacity

13. Terms and conditions • Express • Implied

14. Formalities • Oral or written • Writing required under statute eg for sale of land

15. Practical concernsfor 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)

16. 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

17. 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

18. 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

19. 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

20. 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

21. 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?

22. Setting up a business entity • Sole trader • Partnership • Company • Trust

23. Sole trader • All profits • All losses • All liabilities • Own name or choose business name • Register business name

24. Partnership • Carrying on a business • In common • With a view to profit • Established by written agreement, oral agreement or conduct

25. Partnership • Partnership Act 1892 (NSW) • Corporations Law: Not more than 20 partners (except doctors, solicitors and accountants)

26. Partnership • Profit sharing • Joint and several liability • Fiduciary duties to partners

27. Companies • Corporations Act • Artificial legal entity • Liability of members can be limited

28. Companies • Constitution • Directors duties • Limits on raising money from the public

29. Companies • The “corporate veil” • Lifting the veil: fraud, agency, paying more dividends than profit, incurring debts when company insolvent

30. Companies Form a company by: • Registering name • Lodge application with ASIC • Registered office • Names of directors and members

31. Which structure? • Where are you getting your money from? • What is your risk/liability? • Who will be in control? • What are the ongoing costs?

32. 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)

33. 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..

34. 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.

35. Domain Names and other business identifiers • Trade Marks • Personality Rights • Place Names • Tension with domain names • Reverse domain name hijacking • cybersquatting