Know Risk is a community education program designed by the Australian and New Zealand Institute of Insurance and Finance (ANZIIF) to improve our understanding of insurance and how it relates to managing the many risks we all face in life.
Your rights as an online shopper
You've got to fight for your right for a bargain.
Between the often-discounted pricing, the fact you don’t have to move from your couch to make a purchase and the anticipation of your package arriving, online shopping is perhaps the greatest gift technology has ever given us. Sure, there are all those wonderful technological developments that allow us to stay in touch with people we love when we can’t be close to them, but with online shopping, we get actual tangible stuff, and we are not ashamed to admit that we like having stuff.
But what exactly are our rights as consumers in the online world, as opposed to the very clear rights we have as consumers when we shop at an actual store? When we buy something on eBay or use PayPal to pay for our online purchases, what kind of warranties or guarantees apply, if at all? Is it simply a case of tough luck if the product is falsely advertised or never makes its way to us?
While the world of online shopping and consumer rights is a little bit of a murky area, let’s have a look at what we know for sure when it comes to eBay, PayPal, your rights as a consumer in Australia and New Zealand, and the sorts of precautions you should take before you click “purchase”.
eBay imposes responsibilities on both buyers and sellers. Buyers need to get themselves up to speed on guarantees and warranties, as well as the terms of sale listed by the seller. Sellers must be honest in their descriptions (quantity, age, authenticity, condition, size and usage of an item being sold must all be accurately presented) and ship the purchased items promptly.
eBay notes that the listing description is an implied guarantee. So, if the purchased item is different to what was noted in the listing description, eBay instructs the purchaser to contact the seller to rectify the situation. If no resolution is reached, the purchaser can then dispute the transaction with eBay.
Here are some important things to know about purchases made via eBay:
- Buyer’s remorse or a failure to read the listing description properly are tough luck situations.
- If the seller offered insurance and you didn’t purchase it, they are under no obligation to provide you with a refund or replacement if the purchased item is damaged while in transit.
- eBay does offer a Money Back Guarantee if your order varies from its description or never arrives. However, the item must be purchased on the United States eBay site and a series of complicated payment-specific requirements must be met.
PayPal’s guarantees are a little more straightforward: It provides access to its Resolution Centre, which is a forum through which users are able to dispute a purchase if it never arrives or if a purchased product varies from the product advertised.
PayPal is very clear about the fact that if you purchase a product and the item never arrives, you will receive a full refund if the seller is unable to provide proof of shipment or delivery.
In order for a purchase to be considered as different from what was advertised, one of the following circumstances must apply:
- The item is completely different.
- The condition of the item was misrepresented.
- Parts or features are missing, but this was not conveyed.
- The purchased quantity of the item is not the quantity of the item that was received.
- The item is counterfeit.
- The item was damage while in transit.
Like eBay, buyer’s remorse is not covered.
Regardless of whether your order didn’t arrive or it wasn’t what was advertised, you must dispute the transaction within 180 days of purchase. PayPal then provides a forum through which you can resolve the issue with the seller. If no agreement can be reached, then you can escalate your dispute to a claim and PayPal will provide a final decision.
Consumer rights in Australia and New Zealand
Legislation in both Australia and New Zealand sets out clear expectations of sellers and rights for consumers.
Australian Consumer Law requires the following of businesses that sell goods and services, be they online or in an actual store:
- Australian safety regulations must be met.
- Automatic guarantees must be provided that enable the purchaser to seek a refund, replacement, repair, compensation or cancellation if there is an issue with the purchased item.
- The seller must have the right to sell the item — i.e. the item in question must belong to the seller in full (it can’t be under finance) and it must not be stolen.
- The seller must not provide misleading information about the item, hide information or keep costs hidden.
It’s important to note that Australian Consumer Law doesn’t apply when products are bought via an auction site (so, eBay purchases are only covered by Australian Consumer Law if they are bought at a fixed price) or when items are purchased via a private seller.
In New Zealand, the Fair Trading Act and the Consumer Guarantees Act apply. The former piece of legislation requires the following of those selling goods online:
- They must make it clear that they are eligible to trade.
- They must not mislead consumers about their rights and obligations.
- Any claims made about the product or service in question must have a reasonable basis and sellers must ensure accurate representations about the good or service are made.
- They must comply with any consumer information standards or product safety requirements that apply.
The Consumer Guarantees Act requires that all goods purchased must:
- Be priced reasonably
- Match the description given
- Be the property of the seller and, therefore, able to be legally sold
- Match any sample or demonstration given
- Be of a quality that is acceptable
- Meet the terms of any manufacturer’s warranty
- Be fit for the intended purpose
- Arrive on time and in a condition that is acceptable
In both Australia and New Zealand, consumer guarantees apply to purchases made online with an Australian or New Zealand company, as well as purchases made online with an overseas company. However, buyers should be aware that it can be harder to remedy complaints made against overseas companies given the practical difficulties involved.