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Who are you selling to?

This one is quite easy to answer. You just need to ask yourself whether your customers buy your goods or services in connection with their trade, business or profession. If they do this, then you are selling to a business. This is sometimes called a 'B to B' transaction. If they do not do this, they are buying your goods or services as a consumer (ie for their own personal use). This is sometimes called a 'B to C' transaction.

The distinction is important because, under consumer law, consumers get more protection than businesses and you will need to use different terms and conditions if you sell to them. If you are selling to both business and consumers, you should have two sets of terms and conditions and use them accordingly depending on who you are selling to. For more information, read Doing business with consumers.

What are you selling?

You then need to ask yourself what you are selling. Are you selling:

  • goods

  • services

  • a mixture of both (eg supplying and fitting kitchen appliances)

Sometimes it is hard to decide if you are just supplying goods or services or a mixture of both. In determining whether a contract is for services only or mixed goods and services it is useful to consider whether the transfer of ownership of any goods is a key objective. For example, if you run training courses for professionals and as part of this hand out pens and paper, this is not a mixed contract but a services contract. However, if you supply and fit washing machines, this will be a mixed goods and services contract. If you're not sure what you are selling, Ask a lawyer.

Digital content

If you sell to consumers, you also need to ask yourself whether you are selling digital content through downloads or streaming. If you sell digital content in a tangible medium (eg DVDs) it will be a goods contract. However, special rules apply to digital content sold to consumers through downloads or streaming. For more information, read Consumer rights when purchasing digital content.

If you are selling:

  • digital content to consumers through downloads/streaming, or

  • mixed goods and services to businesses or consumers

Ask a lawyer for help in drafting appropriate terms and conditions as the terms currently offered by Rocket Lawyer may not be appropriate.

If you sell to consumers, do the Consumer Regulations apply?

All of Rocket Lawyer's consumer terms and conditions comply with consumer law, including The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (the Regulations). However, some exceptions do apply, which means that these Regulations do not apply to all consumer contracts.

Specifically, the Regulations do not apply to:

  • gambling services

  • construction and sale of immovable property, including the building of new properties

  • residential letting contracts

  • package travel contracts

  • timeshare contracts

  • supply of consumables by regular roundsmen (eg milkmen)

  • purchases from vending machines

  • single telecom connections (eg payphones and café internet connection)

  • financial services are generally exempt although warranties, credit agreements and insurance which are offered in conjunction with the sale of non-financial goods or services, will still need to meet certain requirements.

If you sell any of the above, Ask a lawyer about what documents you need to have in place.

If you are selling to consumers and the Regulations apply, where does the sale take place?

Once you have decided that the Regulations apply to your consumer contract and what you are selling, you’ll then need to work out whether the sale is:

  • an on-premises sale

  • an off-premises sale

  • a distance sale

This is because the Regulations require more from traders when making sales contracts off-premises or at a distance (ie away from the trader’s business premises). If this is the case, you must give more information and sometimes cancellation rights.

In practice, the most tricky distinction is between on-premises and off-premises contracts.

On-premises contracts

The Regulations say that an on-premises contract is one that is neither an off-premises nor a distance contract. Essentially, if you sell goods on your 'business premises', you will be entering into an on-premises contract. 'Business premises' are immovable premises for permanent business or moveable premises (eg a stall) for usual business.

You won’t need terms and conditions for day-to-day items sold on-premises (eg milk, toothpaste or household items). You should provide terms and conditions on the back of your Invoices if you sell higher-value items (eg antiques).

Off-premises contracts

Here, the Regulations are a bit more specific. According to the Regulations, an on-premises contract is:

  1. made while the parties are with each other away from the trader’s business premises

  2. made following an offer made by the consumer while the parties are with each other away from the trader’s business premises

  3. made on the trader’s business premises or through any distance communication immediately after the consumer was personally and individually addressed while the parties are with each other away from the trader’s business premises

  4. made during an excursion organised by the trader with the aim or effect of selling goods or services to the consumer

The main thing to consider is where your contract is negotiated and made, rather than where it is performed. If you agree to sales with your customers on a face-to-face basis away from your business premises, you will be entering into an off-premises contract. The classic example is doorstep selling.

However, a business that visits a consumer’s home and later sends a contract or quotation for the consumer to decide upon sometime later won’t enter into an off-premises contract unless situation (b) is applicable (ie the customer has made the offer, which is probably unusual). This will be relevant for home-improvement businesses. Though it may sound strange, such a contract would be an on-premises contract by default.

If you are making off-premises sales, Ask a lawyer for the appropriate terms and conditions, as the Rocket Lawyer terms and conditions do not currently cover off-premises contracts.

Distance contracts

A distance sale contract is one that is finalised without any face-to-face contact, for example by internet, mail order, phone or television.

Rocket Lawyer offers template distance terms and conditions for distance sales via the internet only. If you are selling goods by some other means (eg by phone), Ask a lawyer for help in drafting appropriate terms and conditions.

If you have any problem deciding where your contract is concluded, Ask a lawyer.

How to decide whether an off-premises or distance contract needs to include statutory cancellation rights

The Regulations require more from traders when making sales contracts off-premises or at a distance – basically, away from the trader’s business premises. If this is the case, you must give more information and sometimes cancellation rights.

However, there are no cancellation rights for business-to-consumer (also known as ‘B2C’) contracts that include only any of these things:

  • certain prescribed medicinal products

  • passenger transport services (eg bus or rail)

  • goods or services (but not water, gas and electricity and district heating) where prices in a cancellation period would be dependent upon fluctuations in the financial markets, beyond the trader’s control

  • goods made to the customer's specification or clearly personalised - but not simply by combining stock items

  • goods liable to deteriorate or expire rapidly (eg fresh flowers or meat)

  • alcoholic drinks where (a) their price is fixed at the time of the contract, (b) delivery can only take place after 30 days and (c) their value is subject to market fluctuations beyond the trader’s control

  • specifically-requested urgent repairs or maintenance (this exemption will not apply to other goods and/or services provided at the same time not necessarily used for the urgent job)

  • public auctions where consumers attend or are given the possibility to attend (eg not eBay)

  • the supply of accommodation, transport of goods, vehicle rental services, catering or services related to leisure activities if the contract provides for a specific date or period of performance (eg hotel, courier, car hire, restaurant and theatre)

If you are unsure whether your distance or off-premises contract needs to include statutory cancellation rights, Ask a lawyer.

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