Buying Goods and Services from a Distance
Businesses need to provide certain information when ‘distance selling’ any goods or services. As a rule, it applies to sales made by mail order, by text message or phone, or through digital TV.
Extra distance selling regulations also apply if while trading you will be:
- A VAT registered business
- Selling goods or services online (details below)
- Exporting and doing business abroad
Note: Failing to follow the rules means you may get forced to provide the goods or services as agreed. In some cases, the penalty can be paying compensation, receiving an unlimited fine, or a prison sentence.
Before a Customer Places an Order
Under United Kingdom distance seller regulations you would need to provide any potential customers with:
- The name, address, and contact details of your business.
- A ‘fair’ description of the goods or the services you are offering.
- The amount the customer needs to pay (including any relevant taxes) and how they can make a payment.
- Any specific delivery arrangements, including the cost and how long it would take for the goods to arrive.
- The minimum length of the sales contract and the billing period.
- Any specific conditions for ending rolling contracts or sales contracts without a clear end date.
- A method for canceling the order and when the customer would lose their right to cancel it. You should also provide them with a standard cancellation form (if canceling is an option).
- The amount and any conditions for deposits or other methods used as financial guarantees.
- Information on whether they would need to pay any reasonable costs for using a service after a cancellation.
- The cost to use telephone lines or other communication to complete the contract in cases where it would cost more than basic call rates.
- Details on what digital content does and what software it works with (where applicable). This may include the language used or the operating system it functions with.
Note: The information must be intelligible and easy for the customer to understand. As a rule, the format must be one that the customer can save for future reference (e.g. a form, on paper, or in an email).
Customers Right to Cancel
Another regulation of distance selling is informing the customer of their right to cancel. You must let them know they can cancel their order within the first fourteen (14) days of receiving it. Also, the consumer does not need to provide the seller with a reason for the cancellation of an order.
Failing to inform the customer about their right to cancel means they may end the order at any time in the forthcoming twelve (12) months. Telling them about their cancellation rights during this 12 month period means they would then get fourteen (14) days to cancel.
Note: The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 have some differences for downloads and streaming services.
After a Customer Places an Order
Once a customer places an order through distance selling, the trader must then:
- Provide the customer with a copy of the contract that they can save for future reference (e.g. by email, on paper, or using another format).
- Deliver the goods without delay and within thirty (30) days (unless the customer agrees otherwise).
- Provide the customer with a copy of the contract not later than the delivery of the goods.
Exceptions to UK Distance Selling Regulations
There are some exemptions or exclusions to the Consumer Contracts Regulations 2013. United Kingdom distance selling laws do not apply to:
- Contracts for goods and services with a value of £42 (or less)
- Contracts that involve passenger transport services or package travel (e.g. bus, flight, or train tickets)
- Package holidays, holiday clubs, and timeshares
- Contracts for NHS prescriptions and medical products (includes free and paid for treatment)
- Land, insurance, and financial services (e.g. credit, mortgages, pensions)
- Contracts for the construction of new buildings (not property extensions)
- The supply of food and drink ‘perishable goods’ when supplied on a regular basis (e.g. from a milkman)
- Goods bought from a vending machine
- Using a payphone or paying to use an Internet connection (e.g. at an Internet café)
- Contracts that let a property that the customer will live in, such as renting a flat or a house (not estate agent marketing services)
Note: The segment titled ‘accepting returns and giving refunds: the law‘ explains the general rules traders must follow when returning goods and making chargebacks in distance selling from the United Kingdom.
ALSO IN THIS SECTION
Selling Digital Services Online
Traders who use the Internet to sell products and services must follow online selling regulations. Check extra rules that apply when selling digital services such as downloads and streaming services.
Unfair Contract Terms
There are strict rules on using unfair terms in sales contracts (including consumer and business contracts). They fall under the Unfair Contract Terms Act and Unfair Terms in Consumer Contracts Regulations.