Is your e-commerce store expanding to service the international market? Congratulations – this is an exciting growth phase for your business and brand! While you are branching out and testing the demand for your product overseas, it is important that you consider the legal implications of exporting your product outside of Australia. Getting it right from the onset of your expansion will set you apart from competitors. Below we outline some key legal considerations to think about as you export your product overseas.
1. Protect Your IP
Regardless if you are an established Australian business or newly emerging business, you will need to think about protecting your IP outside of Australia. It is critical to identify the markets where you envision your brand expanding and either file directly to these countries or leverage the multiple applications afforded to Australians by international treaties and agreements.
2.Existing Brand and Protection
Already have IP protection in Australia? Whether you have a patent, design registration or trade mark registered in Australia, domestic protection does not afford the same rights as if you had protections internationally. For instance, failing to protect your brand internationally could expose you to potential infringement against a competitor’s brand, or see competitors copy yours.
3. New Brand and No Australian Protection
If you are yet to register your IP in Australia, you can often do it concurrently with your international application. If you register your patent in Australia, you have 12 months to file international patents under the Patent Corporation Treaty and if you register a trade mark or design, you have six months to file international applications.
4. Structure
It is important to ensure that if you are exporting your product overseas, you are now running your e-commerce business as a company. A company is a separate legal entity and a Pty. Ltd. structure ensures that your contain your risk and liability as an individual.
5. Terms and Conditions
A well-drafted set of terms and conditions are important to display on your website and govern your relationship with your consumers. You should understand that different consumer laws will apply in different countries. Generally, however, your Terms and Conditions will set out the following:
- Define payment terms;
- Describe the goods;
- Limit liability;
- Set out the ‘Return and Faulty goods’ policy;
- Dispute resolution, applicable law and jurisdiction.
It is important for you and your business to monitor the safety and quality of the goods you sell. It may be important to recall products should they not satisfy these criteria. The dispute resolution clause will ensure disputes are heard in the jurisdiction you specify (i.e. Australia).
6. Website Terms of Use and Privacy Policy
It is also important to display a Website Terms of Use and Privacy Policy to govern how website users use your site and limit your business’ liability.
7. Insurance
Check with an insurance broker to determine the optimum insurance protection you require.
8. GST
The Goods and Services Tax (GST) will apply to your goods and services sold online through your e-commerce store if you are an Australian company selling to Australian Consumers in Australia. As a rule of thumb, the e-commerce space operates much like a physical store and if GST applies to these transactions, then it will apply online. When you are exporting your products overseas and the purchaser is located outside of Australia, then GST will not apply.
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If you are an e-commerce store looking to break into the international market, it is important that you are mindful of your Intellectual Property and liability when servicing countries outside of Australia. Questions about your next steps? Get in touch with our online lawyers on 1300 544 755.