Common Legal Issues Encountered By e-Commerce Businesses

If you’re contemplating starting an eCommerce business or you are already running one, there are many legal issues that you need to know about and avoid to ensure smooth operations. Virtually every aspect of your brand is bound by some law, and lack of a nodding acquaintance could put you on a collision course with the authorities or, worse, mark the beginning of the end of your business.

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To help you steer clear of this, we have listed below five common issues you are likely to encounter as an online business owner and how to avoid them:

1. Infringement of marketing rules

Digital marketing is the clear winner in a close-run competition with traditional marketing. However, the new playing ground comes with its downsides, and one of them is the increased risk of libel, copyright infringement, and plagiarism. The sheer use of an image, video, or textual content that you didn’t create yourself could land you in trouble and disrupt your operations. To meet the legal compliance for marketing, ensure you have a firm grasp of the fair use check, read creative commons licenses, get your material from reputable stock photo sites, and talk to owners before using their material.

2. Domain name battles

Domain name competitions have been an ever-present legal issue since the onset of the internet. The tussles begin when a new company registers a domain name similar to an existing one. The court might see this as trademark infringement, whether the second company did it innocently or not.

For example, it is virtually impossible to get away with setting up a website with the domain name because of the likelihood of confusing customers that you are affiliated with the better-known tech giant. Well, you can register your, but it won’t be long before you are hit with a lawsuit. Always perform online checks to ensure your domain name idea isn’t taken already. Legal counsel can also come in handy if you are looking for more informed advice.

3. Privacy policies

Many online businesses these days are data-driven. What this means is that you will be having plenty of consumer data on your hands. Keeping this information confidential is the business’s responsibility, and you can be sued for selling or exposing it to third parties.

Bolstering your data privacy starts with securing your site with HTTPS. You will also need to hire an IT professional to help you set up a strong security and privacy strategy to protect you from external and internal data breach threats.

4. Tax evasion

Just because you don’t operate a land-based establishment doesn’t mean you are immune to tax laws. Evading taxes can lead to you being hit by a lawsuit or even being forced out of business. Make sure to understand your tax obligations before launching yourself into eCommerce.


Legal compliance should top the checklist of any online business owner trying to keep out of trouble. Use the above tips to circumvent potential legal issues and stay in good standing with the government.

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