White SW Computer Law
Intellectual Property, Information Technology & Telecommunications Lawyers
Melbourne Office - PO Box 452, COLLINS STREET WEST Victoria 8007 Australia
Sydney Office - GPO Box 2506, SYDNEY New South Wales 2001 Australia
Telephone: Melbourne Office - +61 3 9629 3709 Sydney Office - +61 2 9233 2600
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Email: wcl@computerlaw.com.au Internet: http://www.computerlaw.com.au

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Steve White, Principal - White SW Computer Law

If you operate a commercial website, you are running a global business. Have you considered the many legal issues that arise from e-business?


Choosing a domain name involves similar issues to choosing a business or product name. However, a domain name will be accessible around the globe and there is always a possibility that a business overseas may raise an objection to the domain name use.

Each domain name registry has a dispute resolution policy, which must be invoked when two parties claim the right to use the same domain name. When registering a domain name, you may be asked to warrant that the registration of the domain name will not infringe upon or otherwise violate the rights of any third party. Have you made any preliminary inquiries in relation to your domain name, such a trade mark search?


Intellectual Property Ownership. Do you own the intellectual property relevant to the web site development. If not, are you able to exercise future control over your web site, for example changing web site hosting provider? If you are the intellectual property owner, do you have access to the source code to make future changes to your site? Escrow should be considered when the developer is not prepared to supply the source code.

Intellectual Property Indemnity. If materials are incorporated into your web site which infringe a third party's intellectual property rights, that third party may commence legal proceedings against you for loss and damage caused by your use of their intellectual property. You should ensure that the developer indemnifies you against such a claim.

Insurance. Does your developer have professional indemnity insurance and if so does their policy will provide adequate protection for software development? If the developer does not have professional indemnity insurance, an indemnity with respect to intellectual property may be of little significance if the developer is unable to provide the customer with adequate financial compensation.


Through the use of frames, materials from a web sites may be imported into another site. This form of linking is considered to be a possible source of copyright and trade mark infringement. You should consider prohibiting your developer from framing any third party materials to avoid the legal ramifications, which may arise from this form of reproduction.

Data Mining disputes are also becoming more common. Data mining involves copying data from one site and reproducing it on another. For instance, queries can be set out to extract information from another site and report it on your site. A number of sites which contain large amounts of data are very concerned about this. For example, Telstra is currently in dispute over the ownership of its White Pages entries and whether or not copyright exists.

Meta tags are analysed by the search engines, but are not visible in the normal viewing layout of a web site page. Commonly, Meta tags will include subject headings that visitors may use to find the information contained on the web site. You should carefully monitor the meta tags which are used for your web site, not only to determine the relevance but also to avoid potential legal liability for claims such as trade mark infringement.


When a business in country A operates its web site using computers located in country B and sells goods to a customer in country C, which laws governs the transaction?

Jurisdiction. It is possible that a overseas resident could issue legal proceeding in their country against your business. To reduce the risk of such litigation, you should consider having a requirement that the potential customer agrees to the laws of Australia governing the agreement before the transaction has been completed.

Trade marks. The customer should consider the use of trade marks on the web site. The fact that a trade mark is registered in Australia, does not mean that it will not infringe other parties' trade marks outside Australia.

Trade Practices Act 1974 (TPA). Claims under the TPA in relation to Internet trading commonly relate to engaging in conduct that is misleading or deceptive or is likely to mislead or deceive and representing that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits they do not have.


Internet trading poses some important legal problems to be considered when making the commercial decision to move into e-business. Current legislative and case law developments need to be monitored to ensure that you remain well informed as to your rights and obligations when trading on the Internet.



© White SW Computer Law 2000

This article is a guide only and should not be used as a substitute for proper legal advice, readers should make their own enquiries and seek appropriate legal advice.

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