What is online market and offline market

Online and offline trading: Legal peculiarities when linking

There is not always only black or white, that is, either brick-and-mortar retail or online retail. More and more online retailers are breaking new ground and interlinking their online shops with brick-and-mortar stores. Last but not least, Ebay also recognized the potential and started a pilot project that enables local retailers to offer their products on the online marketplace.

(Image source woman with smartphone: gpointstudio via Shutterstock)

A drive-in for people who collect them themselves or for tablet PCs set up in shops - such various sales channels have long ceased to be a dream of the future. What is particularly exciting about this link between online and offline trading is the legal classification, because it is not always clear. The rights and obligations that are now well-known for pure online trading cannot simply be transferred to the multi-channel or cross-channel.

Right of withdrawal yes or no?

Online retailers who run their own offline business in addition to their online shop have a particularly difficult time, because they have to be familiar with two different areas of law: distance selling law and the rights and obligations that apply to brick-and-mortar retail. There is some overlap here, but there are also serious differences. The first and probably most important difference between selling online and in a brick and mortar store is clearly the existing statutory right of withdrawal, which many online retailers have become tired of.

When ordering via a virtual shop or by phone / fax / email, the consumer has a right of withdrawal. In contrast to a purchase in a store, when ordering online, the customer does not have the opportunity to inspect the goods before purchasing. The customer should also be protected from any typing errors and other technical errors. Customers cannot invoke this protection in a store. There is therefore no legal right to withdraw from the contract.

Once the customer has paid for the product and left the store, there is no turning back. Some shops offer their own exchange or return policy - but this is voluntary. So far, the legal classification is clear.

Differentiation is not always clear

However, it is not always that simple. If the customer visits the online shop and places an order there, he has the rights and obligations from online sales. If the customer orders online, he can withdraw from the contract within a certain period of time. Alternatively, if he enters a shop, he must observe the rights and obligations applicable there (no right of withdrawal or exchange). A possible bad purchase cannot be reversed without an exchange or return right granted for customer convenience.

So far so good ... with the innovative ideas of numerous marketing geniuses and new technical developments, however, new opportunities also arise. There is no longer a clear line between online trading and retail business - including rights and obligations.

Let's first take a look at the law: Distance contracts are contracts in which the entrepreneur and the consumer use only means of distance communication (e.g. letters, catalogs, telephone calls, e-mails, SMS, telemedia) for contract negotiations and the conclusion of the contract and are not physically present at the same time [...].

If the customer orders (and pays) online and only picks up the goods on site, the contract is already concluded in distance selling. There is a classic distance contract that grants the consumer a right of withdrawal. The collection (no matter in which way) in the store does not change anything. Technology has long since known numerous other possibilities ... If the customer orders in the store using computer terminals installed there, the line can no longer be drawn so clearly. Both parties, i.e. the customer and the seller, were "present at the same time" before the order was placed.

The customer is standing in the shop and may even have the opportunity to inspect the goods they want. However, the case cannot be clearly assigned to the definition of distance selling (see above). However, the goods are ultimately ordered via a computer, which suggests that there is also a regular distance selling transaction. The reason is that in most cases the order situation is the same as if the customer were at home P.C. sit and order via the online shop. However, you always have to assess the specific order situation in each individual case and determine the specific rights and obligations on the basis of this.

Strict information requirements

A big difference between the two general sales channels is the issuing of statutory information requirements. Most online retailers can tell a song about how troublesome it can be to comply with the numerous legal information requirements. Although retailers are not completely free in a retail store, the trend towards issuing warnings is widespread even in the event of minor errors, especially in online retailing.

It is therefore particularly important to know when which rights are relevant and which information obligations have to be issued when and how. What both sales channels have in common is that information about total prices, terms of payment and essential properties of the goods or services must be provided.

In addition, there are further product-specific information obligations, which can also differ from product to product, from sales channel to sales channel. Textile labeling and information on the energy efficiency class should be mentioned.

Reverse transaction

Most of the time, the law does not keep up with the new interlinked distribution channels. As an example, the new right of withdrawal provides that the entrepreneur uses the same means of payment to repay the purchase price that the consumer used in the original transaction. If the customer has placed an order online and paid via PayPal, it is not so easy to return and pay out the purchase price in the shop. The seller may agree to the return of the amount in cash with the customer. However, if the customer insists - for whatever reasons - on a repayment via PayPal, this must be taken into account in the processing (for example with the cash register software). In addition, the legislature assumes that the goods will be returned or picked up as standard. Another uncertainty that comes with the design of the cancellation policy.

Conclusion

If different sales channels are combined with one another, it must first be clarified whether the regulations from distance selling law are applicable or not. It always depends on the individual case. For this purpose, the case law is particularly important, because a differentiation between the various sales channels is no longer easy with advancing technical possibilities and innovations on the marketing side.

Once this question has been clarified, the relevant regulations must be observed and implemented in daily practice. Without legal help, it is particularly difficult for online startups to keep track of the various rights and obligations. Difficulties can also arise when creating the terms and conditions on your own.

By the way:

With his new LOCAL packagesupports the Dealer Association the linking of sales channels - i.e. online and offline trading. In this context, stationary sellers get a secure online presence, for example their own website or an appearance on a local online marketplace. In addition, the LOCAL package includes terms and conditions for a stationary business as well as for a print catalog or an insert. With the corresponding seal of approval “local buyer seal”, dealers clearly indicate that they are acting in a legally secure manner. This enables them to stand out from the competition on the one hand and increase customer satisfaction and trust on the other. The seal can thus be used as an effective marketing tool.