Category: Business

US ECommerce Laws and Regulations – What Applies to Your Online BusinessUS ECommerce Laws and Regulations – What Applies to Your Online Business

Many believe that launching an ecommerce business simply entails hiring an ecommerce website development company to take care of the operational requirements. While it’s not expected of business owners to immediately have knowledge, or even have an inkling of ecommerce laws, they must get to that point of having awareness of legislations beyond taxation and licensing laws.

In America, there is no particular regulatory body that assumes the responsibility of regulating ecommerce websites and their operations. Although the Fair Trade Commission (FTC) is recognized as a principal federal regulator, its main focus is on consumer protection in relation to web-based activities, to which ecommerce is only a part.

Yet there are several key federal and state legislations in terms of corporate governance, copyright protection, contractual obligations, privacy protection, child welfare protection, environment laws and anti-money laundering/anti-terrorism laws that must be observed. Observation and compliance is not only with respect to your place of business, but also in the country in which an ecommerce customer resides or is located.

Examples of Laws and Regulations that Can Affect Your ECommerce Operations

Business Taxes

Business taxes are of course basic, while business registration, permits and licenses depend on the state in which you register as your Contact Us address. Import duties and export taxes might become issues especially if you have drop-shipping arrangements with foreign-based suppliers. It would be wise to consult with a tax professional to know certain tax concerns that could affect your ecommerce business.

Regardless of the size and structure of your ecommerce business, the following are some examples of laws and regulations that ecommerce merchants and website operators must know.

Payment Gateway Compliance

While Payment Gateways are service providers, their compliance with various security and data protection measures such as DCI-PSS, EU’s GDPR, SSL Certification, and all other integrated security measures to ensure safety of payment operations. A Payment Gateway’s disregard or non-compliance can have a negative impact on your ecommerce store; including losses arising from security breaches as such incidents could result in hefty fines.

Have Awareness of Shipping Restrictions

Although most shipping companies check shipping restrictions before agreeing to ship items to another state or country, it’s always best to know the key rules beforehand. That way you won’t be accused of illegally selling or smuggling products with stipulated restrictions. Examples of these products include aerosols, alcoholic beverages, ammunitions, animals, CBD, cigarettes, explosives, hazardous materials, nail polish, perfumes and poison, which is just to mention a few. A more comprehensive set of guidelines can be found at FTC’s Electronic Commerce: Selling Internationally,

The bottomline is that when launching a website, especially if for ecommerce purposes, it would be wise to work with an ecommerce website development company that can point you in the right direction and the right professionals who can help you run a successful web-based business.