Tim O’Callaghan is a partner in Druces LLP, specialising in advice to the fashion and luxury goods business. In this month’s column, he advises on protecting your lingerie business online.
As we are all about to hear the sound of sleigh-bells ringing, it is hoped that the tills of UK retailers ring just as merrily in the run up to Christmas.
Meanwhile in cyberspace, we will no doubt hear of more records broken for the number of presents purchased online. The servers of online sellers of lingerie and swimwear will, we hope, be humming and whirring with orders, as UK customers embrace the obvious advantages of privacy and convenience that come with purchasing intimate apparel online.
As many new companies scramble to set themselves up online, more established brands who have dominated the e-tailing market place in this sector are finding that their customers are becoming more aware of their consumer rights. It is equally important for seasoned e-tailers and those new to online sales, to give regular consideration to protecting their brands online and to ensuring that their online terms and conditions are legally compliant to protect their best interests.
The first thing that I advise clients to do is to register their trademark as soon as possible. Technological steps should be taken to protect your brand online, and you should make use of encryption, copy protection and other similar technologies to protect your trademarks and logos on the site.
For those starting out, an appropriate domain name should be selected; your brand name plus a top-level domain (.com, .co.uk etc) should be chosen. The domain name market is a first-come-first-served market and so it is prudent to apply as soon as you have decided on a brand name.
For added protection, brands should consider registering phonetic variations and the anticipated misspellings.
Brand owners should also use technology to maintain as much control over the ability of third parties to copy or download content or to provide unauthorised links or to link the site to others without your permission.
Online terms and conditions
Lingerie businesses are usually quite well informed about retail consumer rights, but when selling online there is an additional layer of regulation which places a great proliferation of rights in the hands of the customer.
The most notorious of these customer rights is the right to cancel during a ‘cooling off period’. The rationale behind this right was to give buyers the opportunity to try the garment on when buying online, as they would in a shop, before they finally decide whether they want to keep it or not. The sting in the provision, which is found in the new Consumer Contracts Regulations 2013, which were brought in this June and which replaces the Distance Selling Regulations.
In an unprecedented move for consumer contract legislation, the new regulations make it a criminal offence for a seller not to inform the customer of their right to cancel.
Online sellers who so not comply run the risk of commercial and regulatory consequences if their sales operations are not compliant with the following rules:-
• Consumer not being bound by the contract;
• Consumer not being liable for any charges which have not been made clear up-front;
• Extending the consumer’s cancellation and refund window by a commercially disastrous 12 months, if the required information about cancellation rights is not given correctly;
• Liability to reimburse customers’ call charges to customer services helplines, which charge above the basic rate for calls;
• Regulatory action being taken against
Intimate apparel businesses have long sought to rely on an exemption in the regulations for ‘goods which by reason of their nature cannot be returned’, but the Office for fair Trading and the DTI who regulate these matters have, in their guidance on the subject, stated that this exception only applies where “returning the goods is a physical impossibility or where they cannot be restored in the same physical state as they were supplied however they are cared for.”
The guidance goes on: “Thus while this exception may apply to items such as latex or nylon clothing which could become distorted once worn, we do not see the exception being applied to lingerie in general.” So what can lingerie and swimwear e-tailers do to alleviate the effect of these regulations?
The key is to have a properly drafted set of online terms and conditions with a compliant but detailed returns policy that emphasises the care which customers must take with garment the (including non-removal of hygiene strips etc) and with the packaging.