Which Law Will Be Enforced for the E-agreement Made for B2B E-trade Transactions?

For the determination of the law which will be enforced for the e-agreements of e-trade primarily it is necessary to determine whether the procedure is carried out for the final consumer (Business to Consumer – “B2C”) or between the merchants (Business to Business – “B2B”). Since the topic of this essay is for our international tradespeople, I recommend you to consider it for the e-agreements of B2B procedures. Since one of the parties of the agreement is “the consumer”, the law which will be enforced for the B2B procedure is open for the mandatory rules of the governments and become more complicated. I leave this issue aside to argue about in another essay for now.

Within the scope of B2B e-trade, the products which are subjected to the commercial activity of a commercial enterprise is prepared through their producer, intermediary or wholesaler and the procedures related to examination of them on the e-trade platform, product selection, order, billing and payment procedures are carried out. This relationship indicates the agreements made between the professional tradespeople legally. Within this frame, the parties are under the duty of care for their commercial procedures and actions. This kind of duty includes their wish and desire to make an agreement which the words such as “accept”, “ok”, “send” they click on mean.

In this case; since the parties are both tradespeople, they have the equal positions for the agreement and they can both choose the law which will be enforced effectually. They might have unwittingly chosen the law which will be enforced for their relationships in accordance with the general procedure conditions used by the e-trade platform they use for the cases where they make this kind of selection.

I presented a summary for the law to enforce in case of a dispute between the buyer and the seller and for the ways to follow by analysing the rules which are called as “standard terms and conditions” from the biggest B2B e-trade portals of the world as follows:

1) Alibaba.com

Alibaba.com has a policy which was revised in 2015 for the solution of the disputes and law to enforce. The platform acts as a mediator in case of a dispute between the buyer and the seller. It demands the supportive evidences from the applicant. The platform which considers the sales agreement which is the most important one among those evidences in the first place and it demands the correspondences of the parties in the second place. It evaluates the dispute in terms of CISG and ICC Incoterms which are the main rules of the international commercial law. It sends a decision to the parties after the evaluation. In case the decision is not approved, it is possible to apply for arbitration with Alibaba.com to the Hong Kong International Arbitration Centre (HKIAC) within 20 days.

2) Amazon.com

First of all, Amazon.com does not have any kind of clear policy to apply for a dispute between the buyer and the seller. This is because Amazon.com acts as an arbitrator. In case of a dispute related to a claim from the service of Amazon.com this dispute is directed to the online dispute solution sites of the United Kingdom (it can be also possible for whole European Union). In case of a dispute with Amazon.com in the United States of America the American Arbitration Association (AAA) solves the disputes subjected to its arbitration rules. Finally; in case the Amazon share is used for the procedure, it has an procedure called as “Buyer Dispute Program” related to this issue.

3) IndiaMart.com

For the disputes in accordance with the General Procedure Conditions of IndiaMart which is one of the biggest B2B e-trade platforms of the world, the Indian laws are enforced and the courts of Noida city are authorized.

4) Made-in-China

For the disputes for the genera procedure conditions of a company which bears the name “Focus”, the Chinese Laws are enforced and the courts of Nanjing Pukou are authorized.

My Recommendations

• Firstly, it is necessary to determine whether the person who you made an e-agreement with is a trades person who engages in professional trade or is an amateur/consumer who tries to buy or sell the second-hand products through an online platform. As I indicated before, do not consider my explanations and recommendations for the e-agreements you made with the consumers/final users (B2C).
• Secondly, you need to determine the country of the foundation or country of residence of the legal entity or naturel person you made an e-agreement with by researching about him/her.
• If the person you made an e-agreement with is a tradesperson, you need to make another sales agreement where the law which will be enforced and the subjects such as product descriptions, payment, delivery, breach conditions, taxes, customs’ procedures, intellectual property are regulated. If it is not possible, you need to add expressions which indicates the conditions to accept the procedure to the part related to the sale/purchase conditions. Otherwise, you can be exposed to loss of rights in a complicated and unclear condition between the general procedure conditions which refers to different rules and laws.

Consequently, it is easy to become a world-wide business through e-trade. However, it is a crystal-clear fact that a commercial relationship which is not well-planned and pre-established can cause big problems. Within this frame, I recommend you to apply to the opinions of your legal experts and to involve them in the project in advance.