Export Knowhow

Key legal issues in cross-border e-commerce

E-commerce has long become an indispensable sales channel for Swiss SMEs. The internet offers companies the opportunity to address users all over the world with a single website. As soon as websites set their sights beyond customers in the domestic market, however, online retailers have to take on some basic legal questions. You can find out what they are here!

E-Commerce key legal issues

1. Does your website also address foreign customers?

A website can directly or indirectly address foreign customers. As a rule, this means that the requirements of foreign legal systems must also be complied with. The decisive factor is whether there is a "focus" on certain foreign customers in a legal sense. In addition to obvious indications such as offering to deliver to certain foreign countries, the following individual criteria, or at least a combination thereof, are evidence of intent to serve foreign customers. The following are a few examples: 

  1. Placement of advertisements in search engines to facilitate access to the
  2. website for foreign consumers.
  3. The activity is of an international nature (e.g. tourism)
  4. Indication of a telephone number with international area code
  5. Use of a top-level domain other than .ch, country neutral (.com) or country specific (.de)
  6. Directions to the place of performance from several countries
  7. Mention of international clientele, in particular through the reproduction of customer ratings
  8. Ability to select another language.

Tip: An English-language version of a website, without further indication of an intent to sell internationally, does not in itself entail that the laws of Great Britain need to be applied. However, the courts will very quickly take a position on this. Unless deliveries abroad are explicitly and clearly excluded, German-speaking suppliers must at least check that they are operating in accordance with EU, or at least German, law.

2. Do you sell to business or private customers?

Explicitly separating offers for business from those of private customers is recommended when exporting to EU countries. This is because there is essentially a little more freedom for business transactions between companies (B2B) when it comes to drafting contracts and, under certain circumstances, a little less effort with regard to value-added tax, as commercial customers settle this themselves in the country of destination.

Tip: If you want to exclude a delivery to private buyers, it is recommended to

clearly indicate that your offer is intended exclusively for commercial customers. In the absence of such an indication, the (stricter) rules for B2C transport may nevertheless apply.

3. Is your delivery area abroad clearly defined?

In contrast to B2B traffic, it is important to note that the contract law of the country in which a customer is domiciled is routinely applicable when sending foreign deliveries to private customers. It is therefore not possible to make contractual stipulations in, for example, your general terms and conditions. As soon as you want to advertise and offer products and services directly or indirectly internationally, it is thus necessary to adapt your website to the respective national regulations. It is advisable to limit the delivery area to those countries whose regulations you have checked and can comply with.

Tip: Specialized providers (e.g. Trusted Shops) can carry out a certification of an online presence or webshop according to national law at a reasonable cost. For more complex issues, it is worthwhile to have a specialist lawyer conduct an individual legal assessment.

4. What information must be provided to customers?

The following information must also be provided to customers when online trading with foreign countries:

  1. Legal notice (Information about the provider, incl. email address))
  2. Data protection (Information on data processing, including purpose)
  3. Product information (Indication of the essential characteristics of the goods)
  4. Indications of price (incl. information about shipping costs)
  5. Delivery and fulfillment information (esp. delivery area and time)
  6. Payment methods
  7. Right of withdrawal (incl. modalities of exercise and exceptions)
  8. Ordering steps (description of the individual steps up to the conclusion of the contract)
  9. Order confirmation (incl. all essential elements of the order)

Tip: In order to fulfill information obligations, it is often not sufficient for the required information to be contained only in your general terms and conditions. You should therefore also have additional information pages available for your customers. Make the information available not only on the website, but also when ordering by email, telephone or fax.

5. GDPR: Which principles apply, and what are the most important consequences?

As is well known, the General Data Protection Regulation (GDPR) has been in force in the EU since May 2018. This brought a large number of new or stricter requirements with it that increase the level of compliance effort for companies. Swiss companies are also affected, even if they do not have a branch in the EU or the EEA. In particular, the GDPR already applies when goods or services are offered to individuals in the EU or EEA. Under the GDPR, any processing of personal data is prohibited in principle, and is thus only permitted if legal permission (such as consent) to do so exists. In addition, strict rules also apply to data subjects' information and they are granted extensive rights (e.g. information, deletion or objection). Failure to comply with these requirements could result in fines of up to 20 million euro or up to 4% of total annual worldwide revenue, whichever is higher.

Tip: Carefully check whether your business processes and data processing comply with the requirements of the GDPR. A large number of the requirements will also be incorporated into the new Swiss Data Protection Act.

6. Which of the various regulations need to be taken into account?

As we all know, Switzerland is neither a member of the European Union nor a member of the European Economic Area (EEA), so Swiss law in the area of e-commerce also deviates considerably from the requirements of EU law in some cases. Although many regulations also exist in Switzerland in a similar form, there are important differences, at least in the details. This is also still the case within the member states of the EU and the EEA. The differences with countries outside Europe are even greater in comparison. For this reason, all local requirements must always be checked for cross-border e-commerce. Some important topics include:

  1. Indications of price (e.g. inclusion and/or transparent indication of all additional costs, foreign or local currency, specifications on price comparisons or advertising with price reductions)
  2. Product specifications (in particular compliance with local product regulations, such as warning notices or information regarding disposal)
  3. Registration obligations (e.g. for data collections or the distribution of certain products)
  4. Right of withdrawal (see below)

Tip: Do not start supplying foreign customers until you have ensured compliance with national regulations. If you have not yet done this, you risk costly proceedings before foreign courts and supervisory authorities.

7. Do other revocation and return obligations apply abroad?

In contrast to Switzerland, consumers in all EU member states have statutory rights of withdrawal and associated information obligations when concluding online contracts. If your online presence is aimed at an EU member state, you must contractually grant customers from this country a period of at least 14 days to revoke the contract. You must therefore have business processes in place that actually allow the return of the goods, and the website must be designed according to the respective formal specifications. Guidance is available from specialized providers (e.g. Trusted Shops) and, in more complex cases, from specialized lawyers.

About Meyerlustenberger Lachenal AG
In the field of e-commerce, we draw on the expertise of experts in selected areas. Lukas Bühlmann, LL.M., is a partner at the internationally renowned law firm Meyerlustenberger Lachenal AG. Michael Schüepp is an associate in Lukas Bühlmann's team.

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