E-commerce
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The regulation of e-commerce activities under Danish law is fairly new, but has gained significant relevance as the level of e-commerce activity has evolved rapidly during the past few years, both in Denmark and abroad. Prior to initiating marketing and sales activities online, it should thus be carefully examined by the e-trader whether such activities are in compliance with the relevant national or foreign legislation.
How is e-commerce regulated under Danish law?
There are several acts and executive orders under Danish law which regulate the use of e-commerce.
The most important acts are:
| 1. |
The Danish E-Commerce Act |
| 2. |
The Danish Act on Certain Consumer Contracts |
| 3. |
The Danish Marketing Practises Act |
| 4. |
The Danish Act on Processing of Personal Data |
| 5. |
The Danish Gambling, Lotteries and Betting Act |
What are the key characteristics of the Danish E-Commerce Act?
The Danish E-Commerce Act (E-handelsloven) was adopted in 2002 and implements the commercial aspects of the EC E-Commerce Directive (2000/31/EC). The Act constitutes Denmark’s primary legal framework governing e-commerce and applies to all services in the information society, defined as any service that has a commercial purpose and is delivered online at an individual's request of a recipient of the service. The main principle of the Act is that businesses offering information society services – i.e. commercial services delivered online – are subject to domestic control. Accordingly, an information society service supplied by an e-trader established in Denmark shall be operated in accordance with Danish law within the coordinated area. This applies irrespective of whether the service is directed only towards another country within the European Union/European Economic Area. The principle of mutual recognition, on the other hand, implies that an e-trader established in another country within the European Union/European Economic Area who supplies an information society service is exempt from compliance with Danish regulations within the coordinated area, even if the service is directed towards Denmark.
Does the Danish E-Commerce Act impose any duties on e-traders?
The Danish E-Commerce Act contains certain minimum requirements regarding an e-traders conduct of e-business. For instance, the e-trader is obligated to inform users of a number of specific details relating to the e-trader’s business, such as the e-trader’s name, place of business, email address, Danish CVR no. (Central Business Registration number) etc. Furthermore, the e-trader must provide sufficient information relating to prices, identification of commercial communication, technical help functions (e.g. accessibility to contract terms and general conditions), order confirmation and reception etc. In addition to these rules, the Act contains a number of provisions which exempt internet providers from IP infringements relating to mere conduit, caching and hosting, provided that specific conditions are met. The rules of the Danish E-Commerce Act complement the general rules and principles of Danish law relating to purchase of goods and services.
What are the main characteristics of the Danish Act on Certain Consumer Contracts?
The Danish Act on Certain Consumer Contracts governs Danish business-to-consumer contracts, as it regulates specific terms of contracts in online transactions as well as distance selling in general. The Act implements the EC Directive on the protection of consumers in respect of distance contracts (97/7/EC) among others and applies to consumer contracts and e-traders’ communications with a view to concluding such contracts, and provides a number of protection measures favouring consumers.
How does the Danish Marketing Practises Act apply to e-commerce?
The Danish Marketing Practises Act contains the rules which business and e-traders conducting business in Denmark must observe when planning the content of their marketing activities. The Act applies to any promotion using electronic means of communication, e.g. emails or text messages, and contains rules, inter alia, on good marketing practice, market conduct, comparative advertising, unsolicited communication with specific customers, consumer protection, price information, fee levying, discounts, sales promotions and special offers, protection of trade secrets, etc. In 2007, the Unfair Commercial Practises Directive (05/29/EC) was implemented into Danish law through an amendment to the Act.
Which regulatory body monitors compliance with the Danish Marketing Practises Act?
The compliance with the Act is monitored by the Danish Consumer Ombudsman. In addition to the rules contained in the Act, the Danish Consumer Ombudsman has issued a number of guidelines. Non-compliance with the Act may be prohibited by injunctions. If a company violates a prohibition or injunction imposed by the Danish courts or the Danish Consumer Ombudsman, the company may be punished by fines or in certain events by criminal liability. In several court decisions, companies have been ordered to pay considerable fines for violations of the Act.
How is the Danish Act on Processing of Personal Data of relevance to e-commerce?
The Danish Act on Processing of Personal Data implements Directive (95/46/EC) on the protection of individuals with regard to the processing of personal data and on the free movement of such data. The Act contains detailed rules on the gathering and processing of personal and private information concerning individuals. Accordingly, the Act is of particular importance to companies and e-traders selling goods and services online, as such activity will inherently involve processing of personal data for business customers and consumers. The Act is administered by the Danish Data Protection Agency.
What is the content of the Danish Gambling, Lotteries and Betting Act?
The Danish Gambling, Lotteries and Betting Act contains rules restricting the offering of gambling, betting etc. services outside of a state-controlled monopoly.
Do any other types of regulation apply to e-commerce?
Other relevant acts under Danish law relating to e-commerce include the Danish Act on Internet Domain Names, the Danish Act on Certain Payment Instruments, and the Danish Act on Actions for Injunctions for the Protection of Consumers’ Interest.
What level of protection do the Danish acts regulating e-commerce provide for consumers?
The Danish Act on Certain Consumer Contracts contains rules governing distance sales, under which Danish consumers are afforded a number of protective measures ensuring inter alia that consumers are able to identify the e-trader and to cancel the contract when purchasing goods and services online. The Act divides goods and services into three categories: (i) goods; (ii) non-financial services; and (iii) financial services. These three categories are subject to different regulation under the Act.
Are there any special requirements regarding an e-trader’s duty of disclosure vis-à-vis consumers?
Pursuant to Section 3 of the Danish Act on Certain Consumer Contracts, the e-trader has a duty to give the consumer certain information in connection with distance contracts prior to entering into the contract. The scope of the information duty varies depending on which category of goods and/or services the purchase relates to, but may include information such as the e-trader’s name, principal business activity and physical address; the nature and main characteristics of the product or service; the total price of the product or service, including fees, costs, any delivery costs, VAT and other taxes; the terms of payment, delivery or other performance of the contract; whether there is a right of complaint or withdrawal; and any specific additional costs for the consumer in connection with the use of the means of communication in question, if such additional costs are imposed.
When must the information be provided to the consumer?
The information must be provided in reasonable time before a contract is concluded, and the information must be clear and comprehensible. It must be clearly stated that the information is provided with a view to concluding a contract, and the information must be provided in a manner that is suitable, considering the means of communication used, and must take minors into particular consideration.
Do consumers have a right to withdraw from a contract which has been entered into online?
Pursuant to the Danish Act on Certain Consumer Contracts, the main rule is that consumers are awarded a 14-day right of withdrawal or ”cooling off period”, irrespective of whether the relevant purchase relates to goods or services. For purchase of goods, the cooling off period starts with delivery, provided that the consumer has been duly notified of the cooling off period by the e-trader (e.g. through a letter or email). For purchase of non-financial services (e.g. repair services or service extensions), the cooling off period starts with the conclusion of the contract, provided that the consumer has been duly notified of the cooling off period by the e-trader (e.g. through a letter or email). If the e-trader has not provided the consumer with such notification, the cooling off period starts when the consumer has been duly notified of the cooling off period. However, in all events - and irrespective of whether notification has been provided by the e-trader - the cooling off period will expire three months from the conclusion of the agreement. In addition, the cooling off period may be shorter than 14 days, if the e-trader and consumer have agreed that the services must be initiated before expiry of the 14-day cooling off period. In such event, the cooling off period will expire when the services are initiated by the e-trader, provided that the e-trader has duly notified the consumer of the cooling off period and of the reduction hereof as a consequence of the initiation of services.
The above does not constitute legal counselling and Moalem Weitemeyer Bendtsen does not warrant the accuracy of the information. With the above text, Moalem Weitemeyer Bendtsen has not assumed responsibility of any kind as a consequence of a reader’s use of the above as a basis of decisions of considerations.