If you operate an online marketplace, you will enter into legal relationships with multiple parties. Each relationship will require a different type of legal document, for instance, a website terms of use that governs the relationship with visitors to your site. When a visitor purchases a product or service through your platform, they will become a customer. You will then need marketplace terms and conditions setting out:

  • a description of what the platform offers;
  • what the suppliers provide;
  • how customers interact with suppliers; and
  • the role of the platform operator.

In this article, we unpack key clauses you should include in your marketplace’s terms and conditions. 

User Registration

It’s important that you have a clause that clearly sets out how parties can access and use your platform. For example, you may require all users to create an account before browsing your website or you may choose to provide restricted access to unregistered users. The type of personal information you collect from users upon registration will affect your privacy obligations. 

Review and Forum Functions

Maintaining integrity and trust around your website is critical not only for growth and expansion but also compliance with the Australian Consumer Law (ACL). Customers are more inclined to use your services if they can see others’ experiences on your platform. As the marketplace operator, it’s essential that you monitor your review or forum functions to make sure that all comments and ratings are genuine and trustworthy. 

Delivery of Good or Service

This clause should set out that the marketplace is not involved in the delivery process. In this section, you should direct the user to the delivery information the supplier has provided to confirm: 

  • their location;
  • time of delivery;
  • method of delivery;
  • cost of delivery; and
  • what happens if the product is delayed, damaged or lost.

Most importantly, your delivery clause needs to state that the marketplace cannot guarantee the quality or timeliness of your supplier or their services.

Payments

Each marketplace operates differently, and there are various payment structures to choose from. You should consider the following when reviewing your payment clause:

  • How does the money flow? Do you take the money directly from consumers or do you take a percentage as commission once the consumer and supplier exchange payment?
  • Do you charge a listing fee, membership fee or account fee?
  • When are the fees payable? Before or after the service is completed?

Cancellation and Refunds

You decide whether to impose a time limit on cancellations or whether you will only grant them in particular circumstances. Each service provider must also have their own cancellation and refund policies, which should be set out clearly in respect of their product or service.

Intellectual Property Rights

Content on your website is owned, controlled or licensed to you or the third party sellers. This clause should confirm that no transaction or interaction between your site and users will constitute a transfer of any intellectual property. Functions such as sharing, liking, posting, tweeting and ‘gramming’ have made it increasingly difficult to protect your intellectual property. For this reason, it’s best to speak with a lawyer who can explain your rights and the best way to protect your IP.

Australian Consumer Law

Your terms and conditions should clearly set out the rights of your consumers as well as your consumer law obligations. Under the ACL, users have certain guarantees relating to the provision of goods and services. As the marketplace operator, you must guarantee that the goods/services supplied are provided with due care and skill and that they are fit for the purpose that you advertised. It is up to the suppliers to guarantee that the goods are of acceptable quality, that they match the description disclosed, and are delivered within a reasonable time. Although you may not be providing the goods or services yourself, your terms and conditions must still confer to your users their rights and responsibilities under the ACL.

Quick Tips

  1. Be clear on how your marketplace will operate before you start drafting your terms and conditions.
  2. Make sure your terms and conditions are easy to understand for all parties.
  3. Put yourself in the consumer’s shoes and make your terms and conditions fair and reasonable.
  4. Don’t leave out important issues. Contact a lawyer who can help you. It’s not worth the headache later to try and draft the terms yourself!

If you have any questions or need assistance drafting your marketplace’s terms and conditions, get in touch with our specialist e-commerce lawyers on 1300 544 755 or fill out the form on this page.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.
Alexandra Shaw

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