Selling online or over the phone? Contract rules for businesses
If you are a business that is selling goods or services online, over the phone, or by email or fax, your contract with consumers is considered a distance sales contract.
The distance sales rules apply to BC-based businesses and any business dealing with a BC customer.
Examples of distance sales:
The online sales of furniture
Booking travel through a website or by phone
Booking an event venue online or by email
Gift cards are not considered to be distance sales contracts.
There are laws in BC that you must follow when it comes to consumer contracts, including distance sales. This includes the information you must give customers before they enter into a contract, what your contract must include and your customer’s cancellation rights.
If your contract doesn’t have everything it should, your customer may be able to cancel it and get a refund.
Not following the rules can also result in financial penalties and/or enforcement actions and have reputational impacts on your business.
The law in BC
As a business engaged in distance sales, think about your contracts as a two-part process.
There is specific information you must legally disclose clearly, at no cost, and before the consumer enters into the contract. Think of this as your pre-contract disclosure.
Once your customer makes their purchase, your contract with them must include everything you were initially required to disclose to them, plus other required information.
There are also rules around how and when you give them a copy of the contract as well as cancellation rights.
The information on this page is not a full list of your business obligations. Please read BC’s consumer protection laws in full.
It’s important to understand there may be other laws that apply to your contracts, including ones that we don’t oversee. We recommend you do your research and have a lawyer review your contracts.
When it comes to distance sales, BC’s law requires you to provide consumers with specific information before they agree to buy. This information must be provided clearly, at no cost, and before the consumer enters into a contract.
Before a consumer enters into the contract, you must disclose:
Your legal name and, if different, your business name
A detailed description of the goods or services to be supplied, including any relevant technical or system specifications (if applicable)
Delivery details (if applicable), including:
the method of delivery
the delivery location
If the goods or services will not be provided at the time the contract is made:
the date they will be provided or supplied, and
the date they will be fully completed (if applicable)
An itemized purchase price
Any additional costs that can be determined in advance, including taxes and shipping charges
Any additional costs that cannot reasonably be determined in advance, such as:
customs duties
brokerage fees
Where payment is in a non-Canadian currency:
the currency that applies
The terms of payment, including:
the payment schedule
the amount of each payment (if payments will be in installments)
The total price, including any cost of credit
Details of any trade-in, including its value (if applicable)
If credit is provided or arranged by the business:
a description of any security interest
Details of any promotional offers, including:
eligibility requirements
duration
terms that apply once the offer ends
Any other terms, conditions, limitations or restrictions
Return, exchange, cancellation and refund policies, or a statement that your business does not have these policies
If the contract includes renewal terms:
how the renewal may occur
whether the contract renews automatically
You must also give consumers an opportunity to review the full contract before the sale is completed. If a consumer asks for a copy of the contract, it must be provided promptly.
If the required pre-contract disclosures are not provided, or if they do not match the final contract, the consumer may have the right to cancel.
This is not a full list of your disclosures, requirements and obligations. We recommend that you read BC’s consumer protection laws in full.
It’s important to understand that there may be other laws that we don’t oversee that apply to your contracts. Do your research and have a lawyer review your contracts.
Your distance sales contract must include the information provided in the pre-contract disclosures, as well as the date the contract is entered into and any other required contract information.
Your contract must include the required information and match the pre-contract disclosures provided to the customer. If the required pre-contract disclosures are not provided, or if they do not match the final contract, the customer may have the right to cancel.
Protect your business by following the law.
Your contract must clearly include:
The date the contract is entered into
Details of any trade-in, including its value (if applicable)
If the contract includes renewal terms:
how renewal may occur
whether the contract renews automatically
If credit is provided or arranged by the business:
a description of any security interest
Any other required information under the Business Practices and Consumer Protection Act and Consumer Contracts Regulation
This is not a full list of required contract information. You have more requirements and obligations. We recommend that you read BC’s consumer protection laws in full.
It’s important to understand there may be other laws that apply to your contracts, including ones we don’t oversee. Do your research and have a lawyer review your contracts.
By law, consumers have cancellation rights in certain circumstances. If they cancel their distance sales contract with you under any of the following scenarios, you must refund them without any deductions within 15 days. A full refund means a refund in the original form of payment and includes all fees, charges, taxes and interest.
If your customer cancels under any of the following scenarios, they must return any goods to you within 15 days of the cancellation notice being given or 15 days after the consumer has returned the goods (if applicable).
By law, distance sales contracts must include a supply date. If the goods or services are not provided within 30 days after the supply date stated in the contract, the consumer may cancel the contract within 30 days of the supply date. If the supply date was not specified in the contract the consumer can cancel the contract at any time before the goods or services are provided if they haven’t been provided within 30 days from the date the contract was entered into.
In the above scenarios a consumer can request the contract be cancelled. As the supplier, by law, you have 15 days from the time the cancellation notice was given to give a refund to the customer.
Businesses must provide customers with a copy of the contract within 15 days of entering into the contract.
If a business does not provide a copy of the contract as required, the customer may have cancellation rights.
If the customer cancels the contract for not receiving a copy of the contract, you must provide a refund within 15 days.
There’s more to know. We recommend that you read BC’s consumer protection laws in full.
It’s important to understand that there may be other laws that we don’t oversee that apply to your contracts. Do your research and have a lawyer review your contracts.
As mentioned above, BC’s consumer protection law says that your customers have the right to cancel in certain circumstances.
Beyond that, as a business, you can set your own refund, return and exchange policies. By law, you must tell your customers about your policies before they make the purchase.
If you do not have return, exchange, cancellation or refund policies, you must still disclose that to consumers before they enter into the contract. Failure to do so may result in the consumer having the right to cancel the contract.
Please understand that your business’ refund and exchange policies do not overrule what the law says.
There’s more to know. We recommend that you read BC’s consumer protection laws in full.
We are a provincial regulatory authority, responsible for overseeing BC’s consumer protection laws. The laws we oversee include the Business Practices and Consumer Protection Act and the Consumer Contracts regulation. These laws outline the rules for the types of contracts your business uses if selling goods or services online, over the phone, or by email or fax.
By law, we have the authority to inspect your business practices and your contracts. Our approach is to help you voluntarily comply with the law – our goal is not to punish, but rather to correct marketplace behaviour. If we do not get voluntary compliance, we have several enforcement tools at our disposal, including the ability to order to you comply with the law and to issue administrative monetary penalties.
Your distance sales contracts are regulated by BC’s consumer protection laws, so we have the authority to inspect your business.
Our goal with our inspections is to identify and help you correct the use of non-compliant distance sales contracts. While we are interested in working collaboratively with you to identify problems with your distance sales contracts, as a business owner, you are responsible for making sure that your contracts meet the law.
During an inspection, you must produce copies of your distance sales contracts and other business records. If we find issues with your contracts, we will identify the problem areas and require you to correct them. There can be penalties for not complying with an inspection.
