In this age of technology, the use of technology has become part and parcel of daily life to many people.
One particular example is that more and more people are buying goods and services online, so what is your protection when you are doing online shopping? Electronic commerce (“e-commerce”) offers many benefits to consumers, such as convenience, easy access to a wide range of goods and services, and the ability to gather and compare information about goods and services.
The Government also actively promotes the e-commerce industry and the use of e-Government services.
To this end, the Parliament has enacted the Electronic Commerce Act 2006 and the Electronic Government Activities Act 2007 to give legal recognition and to facilitate all forms of electronic dealings. The Personal Data Protection Act 2010 is also enacted to protect consumers’ personal data, and this is important as large amount of personal data are transferred through e-commerce transactions. In terms of consumer protection, the Consumer Protection Act 1999 has also put in the relevant safeguards to consumers’ rights and interests when it comes to e-commerce.
In this article, we talk about the legal recourse that a consumer has in the event of a dispute arising from an e-commerce transaction.
Online Shopping Sites
One of the most popular forms of e-commerce activity is online shopping. From buying books on Amazon, bidding for gadgets on eBay, shopping for goods on Taobao to downloading apps from app stores, people are getting more comfortable in doing transactions online.
At one point in time, group-buying sites such as Groupon, MyDeal and Living Social became so popular in Malaysia, thanks to the large discounts and attractive deals that these sites offered.
There are also online-only retailers such as zalora.com.my, lazada.com.my, blog shops such as stylesofia.com, peer-to-peer network sites such as mudah.my and eBay.com.my, as well as forums such as lowyat.net. In recent years, we have also witnessed the growth of many micro e-commerce models where private individuals do transactions and retails through social media platforms such as Facebook and Instagram and chatting sites such as WeChat and WhatsApp.
Online traders are able to offer items with cheaper prices and still make a decent profit margin because they save on the expenses such as rentals, bills and employees’ salaries that they would have to pay if they were to set up physical shops.
Online shopping provides an excellent alternative shopping avenue. One does not have to leave home to get the items that he or she wants. Most of the time, items bought are successfully delivered. But sometimes, customers receive items that are different from what they bought, or they never received their items at all.
What recourses do consumers have if these incidents happen?
1. Read the fine prints
Most of the credible online shopping sites have terms and conditions or fine prints prominently displayed on their sites. The first thing that customers should do is to read the refund or replacement policy carefully.
Some sites offer a full refund or replacement with alternative products in the event of lost or faulty products whereas some sites state that items bought are neither refundable nor exchangeable. Some sites go even further to disclaim their liability in the event the merchants on their sites fail to deliver the products as promised or run away with money paid upfront by the customers.
Under the law, once customers have agreed to the fine prints, they cannot subsequently turn around and say they did not read the fine prints or did not understand the clauses.
That being said, if customers feel that the terms and conditions are substantially or procedurally unfair, they can challenge the terms and conditions on the basis that such terms are unfair under the Consumer Protection Act 1999.
2. Do research
A quick Google search will show a whole list of product reviews of the items that other customers may have made.
Read the reviews to understand whether the items are legitimate or usable as per what the merchants claim. Any good or bad reviews will usually be shared online via social media or forums.
It is always worth the effort to spend some time doing research, and one should never fall into the marketing trap such as that “the offer is ending soon”, which often pushes customers to buy hastily. If the information on the sites is unclear or vague, drop them an email or give them a call to clarify. It may just be an oversight or miscommunication on the part of the sites.
As the saying goes, if a deal looks too good to be true, it probably is.
3. Call to inquire
In the unfortunate event that the items bought are not delivered to the customers, customers should always first call the sites to enquire the delivery status.
Most of the time, they will entertain customers’ enquiry or complaint. A replacement or refund may be offered, depending on the terms and conditions that the customers have agreed to.
4. Legal action
If despite calling the sites but the sites still fail to offer a replacement or refund, customers may consider taking legal action against them.
Hiring a lawyer to file a legal suit for an RM200 item may seem a little impractical. Thankfully, Malaysian laws are quite pro-consumers. Aggrieved customers may file a claim with the Consumer Claim Tribunal (“Tribunal”), which provides an alternative forum for customers to file claims in a simple, inexpensive and speedy manner.
A customer may file a claim with the Tribunal in respect of any claims not more than RM25,000 within 3 years of the dispute except for certain matters such as claims arising from personal injury or death; claims for the recovery of land, disputes concerning a Will, trade secret or other intellectual property, etc.
A customer may file a complaint with the Tribunal claiming for any loss suffered arising from, amongst others:
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false or misleading conduct, representation or unfair practice;
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the safety or quality of goods or services;
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the goods or services not complying with the description/advertisement or fit with a particular purpose; and/or
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services are not being given with reasonable care and skill, not fit for a particular purpose, or not completed within a reasonable time.
The procedure for filing a claim is relatively simple and straightforward. After a claim is filed, the other party will be given a chance to file his defence.
Both parties will be called upon to attend a hearing before the President of the Tribunal on a designated date. The President will hear each parties’ side of the story and make a decision thereafter. No party shall be represented by a lawyer. Once a decision is made, both parties must abide by the decision, subject to judicial review by the High Court.
Non-compliance with a Tribunal’s decision is a criminal offence under the Consumer Protection Act 1999. For more information about the Tribunal, please refer to http://ttpm.kpdnkk.gov.my/.
Conclusion
Online shopping is expected to continue to grow exponentially and some have said that it may even become a mainstream shopping avenue. With the various mechanisms in place that protect consumers’ rights and interests, this will enhance consumers’ confidence in doing shopping online.
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About the author:
This article was written by Edwin Lee Yong Cieh, Partner of LPP Law – law firm in Kuala Lumpur, Malaysia.
This article was first published in CHIP Magazine Malaysia.
The view expressed in this article is intended to provide a general guide to the subject matter and does not constitute professional legal advice. You are advised to seek proper legal advice for your specific situation.
Edwin is a corporate and technology lawyer. He is also the founder and deputy managing partner of Lee & Poh Partnership (LPP Law). Edwin has advised a range of companies from technology startups to multinational corporations on a range of matters. In 2020, Edwin was named as a Malaysian Rising Star by Asian Legal Business, a finalist for the Young Lawyer of the Year at the ALB Malaysia Law Awards as well as a lawyer in the annual ALB publication of Asia 40 under 40.
View his full profile here.
