Distance selling and unfair contract rules asserted against IT sellers

E-commerce company Micro Anvika Ltd. has given undertakings that it will stop using unfair terms in its consumer contracts and will abide by distance selling laws. It has also promised to revise its terms to remove the unfairness. This follows a complaint by its local Trading Standards Department. It has undertaken not to:

exclude liability for defective or misdescribed goods by requiring consumers to inspect the goods and notify faults within a very short time;

exclude liability for mistakes or inaccuracies on its website;

exclude or limit liability for defective software;

have a term allowing them to vary the price and specification of goods;

provide confusing information about delivery charges; and

restrict consumer cancellation rights.

The Unfair Terms in Consumer Contracts Regulations apply to standard contract terms used with consumers in contracts made after 1st July 1995.

The Regulations say that a consumer is not bound by a standard term in a contract with a seller or supplier if that term is unfair. They also give the OFT and others powers to stop the use of unfair standard terms, if necessary by obtaining a court injunction. Ultimately, only a court can decide whether a term is unfair.

The Distance Selling Regulations give consumers rights when shopping on-line or by mail order. Under the Regulations, consumers shopping this way have the right to clear information, a cancellation period of seven working days and protection against fraudulent use of a credit card.

Eleven other companies have given undertakings and stopped using unfair terms, namely: Mesh Computers Plc, Aire Valley Computers, Dabs Direct plc, First Micronics Limited, Mr P Hollis trading as Holtronix Computer Services, Lasertek Computer Systems, Mad Macs Limited, RDC, Spot On Computers Limited, Watford Electronics Limited and Scan Computers International Limited.

The OFT says it is also currently looking at around ten other computer companies that may be breaching unfair contract or distance selling laws.

OFT Chairman John Vickers said today:

"Terms in contracts must be both clear and fair, and consumers must not be denied the extra rights they have if they buy by mail order or on the net."