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Is Contract Law Suitable for the Digital Economy?

Info: 2221 words (9 pages) Essay
Published: 7th Aug 2019

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Jurisdiction / Tag(s): UK Law

A 2,000 word article which examines whether contract law is suitable for the digital economy and whether change are needed to protect and inform consumers.

  • Digital economy with contract law – Safe or no?

The technology exists everywhere in everyone daily life. As the world goes increasingly; online, digital technology is widely used and brings about fundamental changes in the overall economic environment and economic activities. The value of the digital economy is growing in millions of network nodes; it indicates that the benefits generated by the network will increase exponentially as the number of network users’ increase. 

The protection of e-ecommerce consumer rights and interests has encountered new difficulties. This is difficult to obtain effective relief after the legitimate rights and interests of online consumers are damage is also frequently reported. In the process of continuous innovation of e-commerce model, how comprehensively and effectively to protect the legitimate rights and interests of online consumers still needs in-depth study.

  • Principles of contract law in depth

Primarily, it is necessary to set up contract law is to ensure the parties to a contract to each other, agree and obligate to keep their promises. By creating a legally binding relation frequently, refer to four key elements that need to be present; offer acceptance, consideration and intention. 

Not all the e-consumer provide with logical eyes to understand overall standing law of contract significantly in the running of society. The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 have applied the contract between business premises and consumers with types of rule for business providing digital content. ‘Negotiated and agreed by one or more organized means of distance communication. (Business companion, 2018). Whilst I believe this terms and conditions made practical sense in the circumstances to protect consumers’ right, authors such as Ashutosh Kumar et al point out protection is not possible without rigid legal system and it is better if the consumers are pay awareness of their rights and what it is against. It is the format online consumers to participate in marketing research to understand these rights and obligations, as well as full transparency of marketing research professional service providers.

N. Helberger (2012) describes that Digital is an analogue and tangible world, unlike to other areas of law; law relates with digital media aspects was late to respond to the challenges from digital market. 

However, in some case contract law must written invalid. The terms of the offer must commit to all parties concerned and reach a consensus, legal contractual capacities. Form e-commercial normally use in writing and signed by the seller (owner) or estate agent acting. The entire potential purchase document can inform consumers’ acceptance.

A way though representations v Terms

None all things provide of the negotiating a contract is a term and legally binding. The consumer can sued up for the civil offence if provider representations are promises turns out to false which do not form part of a contact. During seller may want to leave a good impression thus misrepresentation and breach of contract. Terms and conditions usually are written in to contract as clarity. In addition, if want to keep the verbal promises into the contract agreement, but it does difficult to prove.

Even though the legal principles have an offer ‘contract law provides the legal framework for economic transactions in the internal market (Article 114 TFEU) However, that does not apply to contracts traders to trade goods or services from the consumer. In terms of the monetary value of consideration, Wiki website (2018) indicates that courts do not take in adequacy consideration between two parties was monetarily fairly. If a person has signed an employee contract binding and found low salary with hard working, which wants to, sought to get rid of his contract. In this case, contact is binding, again, the law usually do not concern with the value and benefit of consideration even if the compensation was incredibly low.

It is the responsibility contracts provide enough information for consumers. Nevertheless, if you think that any of standards terms in consumer contract are unfair to your personal should contact Consumer Direct. Please call the Consumer Direct advice service on 08454 04 05 06 or visit the Consumer Direct website www.consumerdirect.gov.uk. (Office of fair trading, 2008)

If there is, a logical way to protect consumer benefit is great, but some of the business does not portent full of contact information and have to agree with the online commitment for un-wealthy law consumers. Especially some of E-commercial taking advantages of consumers particularly in situations where the consumer does not understand the contract.

  • An example of digital economy

Facebook is a well-known digital company and could not even guarantee consumer safety thus to indicated into conditions law. It has told we have to keep it safe and please to use, we have to secure the registration and account, we have to protect other people’s rights etc. Since Facebook is a device link, a lot of personal privacy this is not 100% surely protect digital user safety. Before we post everything out need a depth consideration because Facebook got the permit to take the image and information to browse and share. Even we can complain about it if we think it is unfair, but the result seems less and less because we already ‘agree’ the terms and conditions.

From recently, a profitable digital company has been struggled with ‘Facebook is facing investigations on multiple fronts after revelations that data on 50m users by an analytics firm (Financial Times, 2018).’ Facebook struggled with recent scandal has made the general news.

The patent will allow Facebook to analyses the user’s family members based on information uploaded by users to their websites and Instagram, including pots, status, friends, photos and more.

At somehow point, it creates a protection for young group consumers indicate from (Wiki, 2017) ‘age-verification regulator to publish guidelines. The Digital economy act 2017 raised concerns about the privacy implications of collecting user data within, especially class of young teenager. Whether who under 13 are broke in the act when they sign a contract at any social media such as Instagram, WhatsApp, snapchat and YouTube will get the same treatment.

Until now, consumer protection still has decentralized and fragmentary legislation, which has led to a lack of basic consumer rights, and the lack of voice of consumers and the constant development of consumers are largely unregulated.

There are protection for consumers also information to inform consumers. The Facebook users have to follow the terms, conditions once been agreed the statement of rights, and responsibilities have provided.

The Disadvantage of digital economic

Internet consumers “security rights”: difficult to maintain security view of the increase in the payment method of online transactions and the complete flow of logistics information. The security rights of online consumers are mainly reflected in the two aspects of payment security and personal information security.

Online consumers “fair trading rights”: difficult to be fair

In the e-commerce B2C model, consumers must first fill in the personal information on the operator platform website, obtain the network identity after completing the registration, and then conduct the transaction according to the relevant format contract terms provided by the operator. The network consumer can only choose to refuse or agree that you cannot negotiate with the operator regarding the terms of the transaction.

In related network platform format of the contract, terms are usually lengthy, narrow interface, the smaller the number of words, not all-online consumers’ professional background, often without the patience to look, in particular, to reduce or waive the terms of the trap operator responsibility, different. To a limited extent or deprivation of the exercise of the rights of online consumers.

Expanding the legitimate rights and interests of online consumers

The more comprehensive the legal norm system of online transactions, the more the legitimate rights and interests of online consumers are confirmed, the less the network operators can make unfair regulations for consumers through format contracts and trap clauses, and even use technical means to force transactions. In the current law, consumers have no right to return because of the right to extend the consumer’s right to know and choose, regulate fraudulent transactions, and guarantee fair transactions, but some network operators still restrict the rights of online consumers. Internet consumers do their best to pay attention to the usual requirements, but still, do not know the true situation of goods and services. If the right to return is exercise within a certain period after using the goods and receiving services, it does not increase the operating cost or damage other Consumers’ interests, consumers’ demand for return-free returns should be supported. The normalization and popularization of online transactions will continue to expand the interests of consumers. The intensity and extent of social protection of consumers will also increase. It is necessary to rationally adjust the distribution pattern of interests of network operators and consumers, and expand online consumers. Legitimate rights and interests, improve the legal norm system and promote the model innovation of e-commerce and the practice of benign trading rules

Moreover, terms and conditions may affect users’ privacy. In practice, they will find it often difficult to identify privacy issues or concrete threats to their privacy.  More generally, in order to acknowledge problems with unfair terms in consumer contracts and possible conflicts with reasonable interests protected elsewhere (e.g., in copyright law, data protection law, or media law), a certain level of legal expertise is required that many if not most consumers lack.

Security concerns mentioned by consumers include email scams, spam, identity theft, viruses, loss of information, and the security of online possessions and communication, for example, in the context of social networks or email (Europe Economics 2011b, pp. 59–60, 105). The recent statistics show that 9% of digital consumers had experienced security problems by Europe Economies (the figures might be higher). More aggressively, consumers are illegal under Article 13(1) and (3) of the Directive on Privacy and Electronic Communications. It is obviously conducting an unfair commercial practice. There are have no many solutions we can do; consumers must cooperate such as to install the latest updates, to qualify for system protection. However, this unclear that process what requires to do it just a bug and spend lots of time.

Digital economic law is not just a regulatory law; this is a development law, a future law and a global law. It is a law that focuses on and protects consumer development, looks to the future and we recommend improving relevant laws. Others problems we identified are such as not reserved to digital consumers, such as the rule of consumer information obligations and the problem of underage consumers. Ultimately, consumer protection law is the long-awaited improvement of the legal standing of consumers. Next innovation in the digital economy is a real contribution to the world and a true responsibility for the word. If this follows the characteristics of the digital economy contributing to a better balance between the rights of digital consumers and digital economy companies.


  • https://www.businesscompanion.info/en/quick-guides/distance-sales/consumer-contracts-distance-sales
  • https://www.ft.com/content/257d4598-2cb9-11e8-a34a-7e7563b0b0f4
  • https://en.wikipedia.org/wiki/Digital_Economy_Act_2017
  • https://www.businesscompanion.info/en/quick-guides/good-practice/consumer-protection-from-unfair-trading
  • https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/284442/oft1008.pdf
  • https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/284426/oft311.pdf
  • https://search-proquest-com.ezproxy.mmu.ac.uk/docview/1550172203?OpenUrlRefId=info:xri/sid:summon&accountid=12507
  • https://link-springer-com.ezproxy.mmu.ac.uk/article/10.1007%2Fs10603-012-9201-1

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