A Binding Contract with Customers
The emergence of online trade has presented new questions related to the contracting process. Therefore, it is quite natural that Great Buys is concerned about the legal force of its online contracts. However, there is no need to worry because, according to the Electronic Signatures in Global and National Commerce Act, even if a contract is drawn up in an electronic format, it is still enforceable (“U.S. Code § 7001,” n.d.). This law, passed in 2000, stipulates electronic signatures used in the formation of an agreement has the same legal force as a handwritten signature (“U.S. Code § 7001,” n.d.). Consequently, customers are wrong saying that they are not bound to the online contract.
International Laws Related to Online Trade
Nowadays, international organizations are still working on developing laws regulating online trade. Some developments include WTO rules that oblige trading parties to be nondiscriminant and transparent in their transactions (Congressional Research Service [CRS], 2019). For example, the Information Technology Agreement cancels the tariffs on information technology products, while the Trade Facilitation Agreement reduces the costs of online trade between countries (CRS, 2019). Apart from that, the U.S. has free trade agreements (FTAs) with a number of countries, such as Australia, Korea, Peru, Marocco, and Chile (CRS, 2019). Each of these FTAs includes a chapter related to e-commerce (CRS, 2019). If Great Buys wants to sell its products internationally, it will have to comply with the mentioned legislation.
Arbitration Clause and Intellectual Property
Arbitration is a process of resolving disputes with the help of a third party that is a neutral, unbiased person rather than a judge. The Federal Arbitration Act that establishes the procedure of arbitration preempts state laws (CRS, 2017). Therefore, if Great Buys includes an arbitration clause to its contract, it will be able to resolve its disputes through arbitration rather than in state courts. Since this company sells household electronics, its intellectual property may include patents, trademarks, and trade secrets. Therefore, Great Buys may add clauses to its contract, which would claim its possession of a unique design of its products and prohibit other manufacturers or traders from utilizing its trademark without its consent.
Suggestions for Improving Internal Business Procedures
To prevent customers’ complaints related to the contract, Great Buys should draw up the document in the most precise manner. It will reduce the possibility of misunderstanding and will be helpful in case of a lawsuit. Apart from that, Great Buys should include a contract clause that will explain to customers how they can resolve a dispute with the company without taking legal action. In this case, it will also be necessary to train the staff to handle customers’ complaints and negotiate with them to eliminate conflicts in a peaceful way. Perhaps, a letter of apology from the company’s employee and a quick solution to customers’ problems will discourage them from filing an action.
References
Congressional Research Service. (2019). International trade and e-commerce.
Congressional Research Service. (2017). Mandatory arbitration and the Federal Arbitration Act.
U.S. Code § 7001.General rule of validity(n.d.).