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Distance Selling Regulations

Jan 15, 2014

by LegalMaryPoppins

Etsy.com handmade and vintage goods

Joanna Tall founded a virtual law firm specialising in female entrepreneurs. Her speciality is advising on all things that make a business tick. Here she explains the basics of a consumer’s right to cancel as laid out in the Consumer Protection Distance Selling Regulations which affect businesses that sell products or services in the EU without meeting their customers face to face. As with any business regulations, be sure to research how these rules affect your own circumstances. HMRC has many resources, and you can also visit Joanna at her website OffToSeeMyLawyer.com, for more information.

Your customer’s right to cancel-whether you like it or not!

Your Etsy shop is live, the catalogue of goods and services enticing, the shopping cart eager to be filled! And then the excitement of the first sale! You package up the item, post it and wait eagerly for that first positive review. But did you know that in the UK and most of Europe, every consumer customer has the right to return an item bought online?

Not many on-line traders are aware of the Distance Selling Regulations which kick in whenever a contract is concluded without meeting customers face to face (or cheek to cheek if you live in France- actually only joking!). So this applies to on-line sales as well as contracts made over the phone. Whilst this is the law in the UK, similar rules apply to Members of the European Union as the law started off as a European regulation.

The good news is that the regulations only apply to “consumer” customers as opposed to business customers. Also, customers have a limited amount of time in which they can change their minds:  7 days from the day after they receive the goods. In the case of services that have been ordered, the 7 days start from the date the order is concluded. In the rest of Europe the time limit is 14 days generally, but please check your local laws. The United Kingdom is also considering extending the limit to 14 days also so as to bring itself in line with the rest of Europe. So if you have an urgent contract for services that your customer wants you to start right away, you must get them to expressly waive their cancellation rights.

The other bit of good news is that cancellation rights do not apply to certain types of contract such as those for bespoke goods or software which has been opened/downloaded.

So what happens when your customer cancels the contract as set out above? Well, you have to refund their money including the delivery charges within 30 days of the date of cancellation. You should state in your terms that the customer has to pay for the return postage or make the goods available for collection.

Finally, there is no good hoping that if you don’t draw your customers’ attention to their right to cancel, the 7 days will slip away unnoticed. The regulations say that you must point out the right to cancel before your customers place their orders. Typically, your  Etsy listing should do this. Simply put a link to your product terms and conditions and the right of cancellation in every listing.

Happy trading!

Ask questions in the comments below and visit Joanna’s website, OffToSeeMyLawyer.com, for more information.

39 comments

  • wanthanastringer

    Wanthana S from PastelGems said 6 years ago

    Thank you so much for all information ....:)

  • Agasart

    Aga from AgasJourney said 6 years ago

    very handy post. Thank you for sharing

  • LoveButtons

    Julia K Walton from FireHorseVintageHQ said 6 years ago

    Good to have it set out in black and white - thank you.

  • ZebrogBaby

    Stephanie Blyth from ZebrogBaby said 6 years ago

    Brilliant and just in time for me writing my policies :). Thanks

  • DamsonTreePottery

    Marieanne Cavaciuti from damsontreepottery said 6 years ago

    Thanks so much for the advice!

  • sockysocks

    Mandy Williams from sockysocks said 6 years ago

    It is also worth noting that the customer does not have to return the item before you give a refund. Under DSRs we as UK sellers are also responsible for items lost in the post. Short lealet here - http://www.oft.gov.uk/shared_oft/business_leaflets/general/oft913.pdf Longer version here - http://www.oft.gov.uk/shared_oft/business_leaflets/general/oft698.pdf

  • sockysocks

    Mandy Williams from sockysocks said 6 years ago

    Under DSRs it is also worth noting that the seller doesn't have the right to insist on the item being returned before making a refund and that the seller is also responsible for items being lost in the post. There are two very good UK government leaflets on DSRs (a short and long version) but for some reason I am unable to post them here - so google them if want more information..

  • creativehistory

    Creative History from CreativeHistory said 6 years ago

    Excellent advice, thank you for clarifying a few points that I've been wondering about for a while.

  • AlistirWoodTait

    Alistir Tait from AlistirWoodTait said 6 years ago

    I've always been confused by the fact that the seller "doesn't have the right to insist on the item being returned before making a refund". Surely they can't expect a seller to refund before goods are received back? At that point the seller has neither the goods nor the money. Perhaps I'm interpreting it wrong.

  • sockysocks

    Mandy Williams from sockysocks said 6 years ago

    Alistir, I am unable to post the link here but on page 25 of the larger of the two leaflets I mentioned before it says this - What specifically do I have to refund to the consumer if they cancel? The DSRs require you to refund any money paid by or on behalf of the consumer in relation to the contract to the person who made the payment. This means the full price of the goods, or deposit or pre- payment made, including the cost of delivery. The essence of distance selling is that consumers buy from home and receive goods at home. In these circumstances, almost every case of home shopping will involve delivery of the goods ordered and so delivery forms an essential part of the contract. If you google Distance Selling Regulations the leaflets are easily found. Perhaps the blog writer Joanna could add the links.

  • daisyanndesigns

    Jill from daisyanndesigns said 6 years ago

    So is it better for me to close my shop before I go bankrupt? I'm really concerned, as I make everything I sell to order and I really don't have the funds to refund and lose my work.

  • sockysocks

    Mandy Williams from sockysocks said 6 years ago

    Jill, I really don't think there is anything to worry about. These regulations aren't new and in nearly 4 years of selling no-one has yet asked me for a refund.

  • oneofthreedesigns

    Sarah Hall from Oneofthreedesigns said 6 years ago

    Great post, thanks for the facts.

  • MaeBud

    MaeBud from MaeBud said 6 years ago

    Thank you Legal Mary Poppins!

  • arvensis63

    Susan Rands from GoldfinchNest said 6 years ago

    Thank you for the clear advice. I'm just off to amend my policy now.

  • sockysocks

    Mandy Williams from sockysocks said 6 years ago

    A note to Jill from daisyanndesigns - if you mean you make custom orders (or bespoke as it says in the blog) these are exempt from DSRs so you would only ever need to refund if the item was deemed faulty or mis described.

  • mollygdesigns

    Molly Glass from MollyGDesigns said 6 years ago

    Excellent advice thanks

  • daisyanndesigns

    Jill from daisyanndesigns said 6 years ago

    Thank you Mandy xxx, you have put my mind at ease. :)

  • cloudsong

    Steve Harrison from cloudsong said 6 years ago

    Thanks for info. Good to know. I,ve learnt so much from this site. I love it.

  • davidaldred1

    David Aldred said 6 years ago

    Just to clarify on the 'made to order' exemption - this only applies to truly bespoke items - items individually created for a customer (eg, has an alteration, name engraved etc.). That you simply create an item to order does not in itself exempt you.

  • textilechicken

    textilechicken from textilechicken said 6 years ago

    Thanks for this information,and your time. Much appreciated.

  • Minkymoojewellery

    Amanda Botwood from MinkymooJewellery said 6 years ago

    Thank you. That is really helpful - I'm going to put a link to my policy page on my listings from now on. Much appreciated!

  • juliettelivesey

    Juliette Livesey-Howe from MonsterOrphanage said 6 years ago

    Hi, I have a query. Now that Etsy has a tab clearly labelled 'Shipping and policies' next to every listing description, do we really need to include an additional link to them in the product description? Seems to be doubling up unnecessarily. My descriptions are already too wordy!

  • silkandart

    Fiona Stolze from silkandart said 6 years ago

    Great article, thanks. I just wanted to clarify. This affects all sellers in the UK and affects all overseas customers without exception? I'm going to get my terms and conditions updates asap. It always interests me to see Etsy sellers maintaining that customers are responsible for items lost in the post, etc. Sellers really have to know the legal blurb. I also wanted to mention that I've never had any bother with refunds etc in the time I've been working online both on Etsy and my own site.

  • madelineflynn2

    Madeline Flynn from MaddyVintageHostess said 6 years ago

    Thank you I just had to tweak mine for Europe otherwise it was all done. I have a lot of sales from outside Europe and I guess if the question arose I would apply those rules anyway.

  • jcudesigns

    Jill Unthank from jcudesigns said 6 years ago

    I've had 2 requests for refunds and although both promised to return the goods they never did - I'm afraid it is just part of the business regulations we have to put up with. It is a shame that larger companies do not comply to this - I've had several well-known online stores not refund my postage costs back when I've returned items and one trainer company refuse to refund until the 'lost' parcel was refunded by the PO. I had to quote the DSR to them and threaten reporting them before getting a refund. Suffice to say I wouldn't use them again - and really, we all want to keep our customers happy in the off-chance they return to purchase again.

  • gaiahandicrafts

    Angélica Maripociosa from PeaceAPorter said 6 years ago

    Very useful advice. Duly noted!

  • shazhee

    Shaz G from TheBabyBootieque said 6 years ago

    Thank you for the advice :)

  • coldhamcuddlies

    Isobel Morrell from COLDHAMCUDDLIES said 6 years ago

    Thanks for that info - good to know the rules, as I didn't realise they existed in this instance! I've been going for 4 years now, and so far - touch wood, and everything else around - no one has asked to be refunded. Some one cancelled after I pointed out there was no way an item could reach them in the time they had allocated - 5 days from the UK to mid-USA! But there was no problem, as nothing had been sent.

  • capnhack

    Dafydd Owens from NightCatArts said 6 years ago

    Thanks for this useful article, I'll make some amendments to my terms. I would also like to know whether the extra link in the descriptive text itself is necessary since policies are already linked from the page. I have read through the DSRs but don't recall seeing anything related to that, or to the refund having to be issued before the item is returned. My interpretation was that, if the buyer wants a refund within the first 7 days of receipt, they would then request the refund and post the item back on the same day or week, thus allowing returned items to actually turn up back at the seller well within the 30 days' refund limit no matter where on the planet they bought them from (almost). I also can't recall seeing anything about return postage being the liability of the seller, meaning the refund is for the item cost and the postage cost paid at checkout, but not the cost to return the item to the sender. A few clarifications on the above would be most useful, since the specifics are probably being overlooked due to my limited knowledge of legalese.

  • NatalieBreezeDesign

    Natalie Breeze from NatalieBreezeDesign said 6 years ago

    There are a lot of big companies that trade online in the UK that state that if you want to cancel within 7 days you can and they will refund your full item amount but not the postage costs which from reading the full DSR documents I know is wrong, how do they get away with this blatant disregard in their written policies?! It really annoys me when I know I am struggling for money but if someone wanted to cancel because they changed their minds I would have to refund including postage costs I had already spent which would put me out of pocket.. I do conform to what is the law but surely the big companies should have to too??

  • NatalieBreezeDesign

    Natalie Breeze from NatalieBreezeDesign said 6 years ago

    Dafydd Owen @ NightCatArts I have read the whole DSR docs and it does say that the buyer has a right to be refunded even if they do not return the goods and that you can't state a certain amount of time that the goods have to be returned in, which does make me very uneasy as a small business owner and is very much on the side of the buyer (that's European law for you); it says that if they don't return the goods or not in a re-saleable state that you can 'open a case against them' but I havn't a clue how this would actually work and sure it would cost you more money than you actually recouped getting the item back from the customer. I state in my policies that I would 'ask' them to return the item within 7 days whereby I am not saying they are legally obliged by law to do this but that this is the best and expected way to proceed Basically, the wisdom I gleamed from reading the whole regulations is that you have to grit your teeth and hope you're lucky enough to get customers that make a reasoned choice and don't impulse buy! On the point of having a link in your text the regulations say you have to provide a hard copy to the customer (i.e. by E-mail) at the point of sale for the 7 days to start from the purchase day, otherwise if you send a copy of your terms to them with the delivered item the 7 days start from the delivery date; If you do not provide a copy of the regulations at the point of sale or at delivery (it does tell you the main points you have to state which I don't have to hand at the moment but if you check my shop policies you will find them) the customer has something like another 60 days (I can't remember off the top of my head) to make a claim if they really know their stuff. This is why as part of my automatic E-mail that gets sent to buyers when I make a sale (even though I include the info in my policies) I list the details of the main points of the DSR as a footnote so there is definitely no possible comebacks of not supplying the right info at the right time, If anyone wants a copy of the document please contact me as I think I have it on my old computer, I could send you; it is a while since I read it but it did take me a good couple of days to write my shop policies, mostly down to this document,

  • LoveLoveDOUBLELove

    Lynn from LoveLoveDOUBLELove said 6 years ago

    Thank you for the info., good to know. Any chance LegalMaryPoppins can show a good example / reference where this is shown? Many thanks

  • BlaqKat

    Blaq Kat from BlaqKat said 6 years ago

    I've known about the DSR but I was unaware that we are meant to point it out in our listings. I think I have it in my policies *will have to check that!* Thanks for this, always good to keep up to date

  • gemmajolee

    Kim from GemmaJolee said 6 years ago

    I really don't understand why sellers have to refund customers before receiving the goods back. It's like saying to Marks and Spencer "oh I bought this top from you but here is my receipt, give me my money back and I'll bring the top back next week". This DSR rule is definitely open to abuse. As a seller there are risks selling online. Why shouldn't it be the same for buyers? When you buy online, a lot of hassle and inconvenience of shopping is taken away from you, not to mention the ability to find totally great and unique items that you wouldn't normally find in your local shopping centre. Buyers can't always have it all their own way.

  • WyckoffSmith

    Michele Wyckoff-Smith from WyckoffSmith said 6 years ago

    Good to know. Thanks for this blog post.

  • capnhack

    Dafydd Owens from NightCatArts said 6 years ago

    @Natalie Breeze: Thanks Natalie, that helped a lot. I'll take a look at your policies to make sure I'm not making any stupid mistakes in mine, and I'll add a footnote to order confirmations too (great idea). Unfortunately it seems like the "hope" approach is all we have to go on as UK sellers, and a civil suit to recoup losses from unreturned goods would almost certainly end up costing us more even if we ensure that court fees and even legal representation costs are added to our winnings. Time is money, after all. When it comes to large companies abiding by the DSR and other consumer rights, they already have large legal teams in place to throw money at for minor stuff like using their logo in a way that isn't technically allowed so they can easily afford to pass on any customers' complaints to their legal department who will either threaten the customer or (as in most cases) will agree that they owe them more money and settle before it gets to court. Although it is illegal to trample all over someone's statutory rights in the terms and conditions, I believe anyone can write whatever they want in there and get away with it if they state somewhere that the customer's statutory rights are not affected by those terms. Whether that tiny line is prominent or hidden somewhere makes no difference, so the more prominent terms state that they won't refund postage and they just hope that customers aren't aware of their rights and won't fight for more, but if it does go to court they will hide behind the fact that they stated the customer's statutory rights override their terms. They'd still end up having to pay what's owed, but they wouldn't get any more than a telling off for essentially trying to trick their customers. In other words, no additional cost to them. @Etsy blog back-end coders: Not stripping line breaks from comments would make things rather more legible when it comes to large amounts of text.

  • owentingle

    Owen Tingle from viciousnoodles said 5 years ago

    I had no idea that the law allows people to basically steal from you, that's outrageous. That's one step away from using an honesty box!

  • sarahbrunner

    Suitcase Vintage from SuitcaseVintage said 5 years ago

    It's a bit painful if things do go missing in the post - I had two really nice things lost in the past this month and frankly, having to refund the items and the post is VERY VERY PAINFUL! Sounds like there's no choice though, and means I'll have to start charging for tracked post on things. Bummer.

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