Selling online or over the phone? Contract rules for businesses
If you are a business that is selling goods or services online, over the phone, or by email or fax, your contract with consumers is considered a distance sales contract. This is because either the transaction isnât done in person, and/or your potential customer canât inspect the goods beforehand.
The distance sales rules apply to BC-based businesses and any business dealing with a BC customer.
Examples of distance sales:
the online sales of furniture
booking travel through a website or by phone
booking an event venue online or by email
Gift cards are not considered to be distance sales contracts.
There are laws in BC that you must follow when it comes to distance sales, especially when it comes to the details you must give to your potential customer before they buy, the information that needs to be in your contract once they buy as well as your customerâs cancellation rights. If your contract doesnât have everything it should, your customer may be able to cancel it and get a refund.
Not following the rules can also result in financial penalties and/or enforcement actions and have reputational impacts on your business.
The law in BC
As a business engaged in distance sales, think about your contracts as a two-part process.
there is specific information you must legally tell your potential customer before they buy your product or service. Think of this as being part of your quote.
once your customer makes their purchase, your contract with them must include everything that you were initially required to disclose to them, plus other details.
There are also rules around how and when you give them a copy of the contract as well as cancellation rights.
The information on this page is not a full list of your business obligations. Please read BCâs consumer protection laws in full.
Itâs important to understand that there may be other laws that apply to your contracts, including ones that we donât oversee. We recommend that you do your research and have a lawyer review your contracts.
When it comes to distance sales, BCâs law has a list of things that you must disclose to your potential customer before they enter into a contract with you (meaning before they make the decision to buy your product or service). You must make this information easy to find and understand.
Before a customer enters into the contract, you must disclose:
your business information (mailing address, phone number, fax number, and email address if you have one)
the cost and currency of the amount owing under the contract, including tax or any additional charges
the supply date
a detailed description of the goods or services being supplied, including any relevant technical or system specifications
an itemized purchase price for the goods or service to be supplied under the contract
other costs to be paid by your customer, including taxes and shipping charges
if you canât reasonably determine any customs duties, brokerage fees, or additional charges that may apply, you must include a description of those charges
a detailed statement of the terms of payment
the total price under the contract, including the total cost of credit
any periodic payments under the contract and the amount of each payment
the date on which the supply of goods and services will be complete
the delivery arrangements, including the identity of the shipper, the mode of transportation, and the place of delivery to your customer
your cancellation, return, exchange, and refund policies, if any
any other restrictions, limitations, or other terms or conditions that may apply to the supply of the goods or services
This is not a full list of your disclosures, requirements, and obligations. We recommend that you read BCâs consumer protection laws in full.
Itâs important to understand that there may be other laws that we donât oversee that apply to your contracts. Do your research and have a lawyer review your contracts.
For required disclosures, read the Business Practices and Consumer Protection Act, section 19 (a) to (c), (f) to (j) and (n), section 23(2), section 46.
Your distance sales contract must include everything from the previous disclosure list as well as additional details.
Not having this content gives your customer the right to cancel their contract with you within 7 days from the date the consumer receives a copy of the contract. (By law, you must give a copy of your distance sales contract to your customer within 15 days after the contract is entered into.)
Protect your business by following the law.
Your distance sales contract must also include:
your customerâs name
the date the contract is entered into
if applicable, a description and dollar value of any trade-in
a notice of the customerâs rights of cancellation, if any
This is not a full list. You have more requirements and obligations. We recommend that you read BCâs consumer protection laws in full.
Itâs important to understand that there may be other laws that apply to your contracts, including ones we donât oversee. Do your research and have a lawyer review your contracts.
By law, your customers have cancellation rights in certain circumstances. If they cancel their distance sales contract with you under any of the following scenarios, you must refund them without any deductions within 15 days. A full refund means a refund in the original form of payment and includes all fees, charges, taxes, and interest.
If your customer cancels under any of the following scenarios, they must return any goods to you within 15 days of the cancellation notice being given or 15 days after the goods have been delivered, whichever is later.
By law, distance sales contracts must include a supply date. If the goods or services havenât been delivered within 30 days of the supply date stated in the contract, or you didnât give a supply date and they havenât been delivered within 30 days from the date the contract was entered into, your customer can cancel the contract.
To cancel, your customer must send you a cancellation request. As the supplier, by law, you have 15 days from the time the cancellation notice was given to give a refund to the customer.
By law, your distances sales contract must have all the required contents. See the section above for those details. If your contract is missing any of the required details, including the supply date, your customer can cancel their contract within 7 days after the date that your customer receives a copy of the contract.
To cancel, your customer must send you a cancellation request in a way that proves delivery. As the supplier, you have 15 days to refund your customer.
By law, you must give a copy of your distance sales contract to your customer within 15 days after the contract is entered into. If you donât, your customer can cancel the contract within 30 days after the date that the contract is entered into.
To cancel, your customer must send you a cancellation request in a way that proves delivery. As the supplier, you have 15 days to refund your customer.
Thereâs more to know. We recommend that you read BCâs consumer protection laws in full.
Itâs important to understand that there may be other laws that we donât oversee that apply to your contracts. Do your research and have a lawyer review your contracts.
Read about consumer cancellation rights in the Business Practices and Consumer Protection Actsection 49, section 50, and section 54. Read about the return of goods to you in the Business Practices and Consumer Protection Actsection 51.
As mentioned above, BCâs consumer protection law says that your customers have the right to cancel in certain circumstances.
Beyond that, as a business, you can set your own refund, return, and exchange policies. By law, you must tell your customers about your policies before they make the purchase.
Please understand that your businessâ refund and exchange policies do not overrule what the law says.
Thereâs more to know. We recommend that you read BCâs consumer protection laws in full.
Read about consumer cancellation rights in the Business Practices and Consumer Protection Actsection 49 and section 50. Understand what information you must tell your customers in the Business Practices and Consumer Protection Act,section 46. Read about the return of goods to you in the Business Practices and Consumer Protection Actsection 51.
We are a provincial regulatory authority, responsible for overseeing BCâs consumer protection laws. The laws we oversee include the Business Practices and Consumer Protection Act and the Consumer Contracts regulation. These laws outline the rules for the types of contracts your business uses if selling goods or services online, over the phone, or by email or fax.
By law, we have the authority to inspect your business practices and your contracts. Our approach is to help you voluntarily comply with the law â our goal is not to punish, but rather to correct marketplace behaviour. If we do not get voluntary compliance, we have several enforcement tools at our disposal, including the ability to order to you comply with the law and to issue administrative monetary penalties.
Your distance sales contracts are regulated by BCâs consumer protection laws, so we have the authority to inspect your business.
Our goal with our inspections is to identify and help you correct the use of non-compliant distance sales contracts. While we are interested in working collaboratively with you to identify problems with your distance sales contracts, as a business owner, you are responsible for making sure that your contracts meet the law.
During an inspection, you must produce copies of your distance sales contracts and other business records. If we find issues with your contracts, we will identify the problem areas and require you to correct them. There can be penalties for not complying with an inspection.
This information is an overview of your obligations under BCâs consumer protection laws. Please read the Consumer Contracts Regulation and the Business Practices and Consumer Protection Act in full to understand all your obligations and your customersâ cancellation rights.
We also recommend that you do your research to find out what other laws may apply to your contracts and have a lawyer review them.
Your customers can file a complaint with our office if they believe that you have breached the law.
