Online contracts: the current state of ecommerce in Australia

Last year there was a surprising amount of interest when Dell’s Australian website advertised the wrong price for a hard drive. It turned out that hundreds of customers had ordered the 250GB hard drive for $A8.80 – almost $A600 less than their usual price. Whilst Dell had to weather some publicity, its conditions of sale covered the situation.

According to the August 2005 SensisĀ® e-Business Report (pdf) 83 per cent of Australian households reported having a computer of some description, with 72 per cent of households being internet enabled and 31 per cent having broadband connections. Overall, 42 per cent of Australians had made purchases online.

The recent release of The Australian Guidelines for Electronic Commerce has prompted me to revise and update my paper on online contracts (13 pages, pdf, free download).

According to the DCITA Current State of Play report issued in November 2005 most SMEs are active in Internet banking and e-commerce. Internet banking remained the most popular financial activity online in 2005, while 50% receive payments online and 41% take orders online.

In April 2005, 59% of Internet users performed online buying/selling activities. Buying and selling online included:
– buying/selling/renting property;
– buying/selling stocks;
– buying PC software/hardware;
– buying books;
– buying recorded music/video;
– buying travel plus related;
– buying clothing/accessories;
– buying tickets;
– buying food/grocery items;
– buying other items; and
– paying bills online.

If you have a website that sells products or services online, besides understanding how online contracts are formed you also need to understand the risks and legal issues: have at look at my compliance guidelines.

UPDATE: Webmonkey offers a list of ecommerce issues to help you plan your ecommerce site.

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