Over the years, Singapore’s e-commerce market has seen rapid growth, estimated to reach $9.8 billion by 2025.
As such, the Singapore government has put e-commerce laws and regulations into place to boost consumer and business confidence in online businesses.
In this article, we will look at some of the e-commerce laws and regulations, particularly for those thinking of starting an e-commerce business in Singapore. Most of these guidelines are interconnected and cover internet access, broadcasting, privacy, and electronic transactions, among others. We will also try to simplify the guidelines and ‘bundle” inter-related laws for clarity.
Internet Code of Practice and Singapore Broadcasting Authority Act
All online businesses in Singapore must comply with the country’s Internet Code of Practice (ICP). These are guidelines on the obligations of all internet service providers (ISPs) and internet content providers on which types of content, publications, or programs count as prohibited materials in the country.
The Singapore Broadcasting Authority (SBA) Act meanwhile outlines what you’re allowed to broadcast on your website or whichever e-commerce platform you plan to use, and more importantly, Singapore’s licensing scheme for online merchants.
Depending on the type of e-commerce entity you’re setting up, you may also be required to acquire additional licenses. For example, for entities looking to sell secondhand goods, the Secondhand Goods Dealers Act 2007 mandates them to secure a specific permit aside from the class licenses that the SBA provides.
Electronic Transactions and Computer Use
As an online business, you’re expected to handle a lot of transactions electronically, mostly through web contracts. The Electronic Transactions Act 2010 facilitates the security and legality of electronic records, signatures, and contracts. This ensures that web contracts, along with signatures, documents, and records, are legally valid and recognized even if they are not in the usual paper form.
Most of the time, all transactions within the e-commerce industry involve the collection of personal data from consumers. Online businesses will often have records of things like customer preferences and purchase history.
The Computer Misuse Act 1993 and Personal Data Protection Act (PDPA) 2012 work together by making provisions for the safeguarding of these kinds of information against unauthorized access. This means that online businesses are expected to have security measures such as data encryption and secure data storage that ensure there is no leakage of information on their end.
Misrepresentation and Sales Guidelines
In relation to the Electronic Transactions Act, the Misrepresentation Act 1967 protects consumers that may have entered contracts under false or misleading pretenses. Online businesses must know this to avoid misrepresentation in their web contracts and the possible damages that may follow.
As with all businesses that deal with the sale of goods, e-retailers are also bound by the Sale of Goods Act (SOGA) 1979. The SOGA is a product liability law that also outlines contracts of sale, duties of both seller and buyer, product valuation, and warranties, among others.
Under SOGA, all goods sold to a consumer must be of satisfactory quality. In addition to this, descriptions and samples made by the seller must match the actual quality of the goods. Any discrepancies between the description and the actual quality grant consumers the right to reject or return the goods.
All online businesses that deal with the sale of goods are obligated to know and comply with these statutes. Note that as of writing, Singapore doesn’t have a single product liability law that governs services and goods in all sectors. Hence why there are also sector-specific product liability laws such as the Sale of Food Act 1973, Health Products Act 2007, and the Telecommunications Act 1999 to name a few.
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Card Payments and Data Security
Along with the continuing growth of the e-commerce market, consumers are also leaning towards going cashless and using electronic payments or e-payment for their online purchases.
If you’re planning to accept credit card payments for transactions under your business, ensure that you comply with the Payment Card Industry’s Data Security Standard (DSS). There are 12 requirements for PCI DSS compliance including the provision of secure authentication features and regular testing of security systems and processes. Under this standard, your online business is also forbidden to store or retain any credit card data such as credit card numbers and card verification values.
Compliance with PCI DSS establishes trust between sellers and consumers. It also prevents credit card fraud in case of any data breach.
Trade Marks and Copyright
The internet has made it incredibly easy to share and transfer pictures, books, and other works across any online platform. Hence the establishment of Intellectual Property (IP) Laws to protect the rightful owners of these works. The Trade Marks Act 1998 and the Copyright Act 2021 in particular are IP laws that business owners should know.
A trademark is a distinct collective mark or certification mark — either a symbol, design, or words and phrases — that represents a business or the goods or services that they provide. It is a property right through trademark registration under the Trade Marks Act 1998.
This Act covers the application for registration of a trademark, the registration procedure, as well as the rights and remedies of a trademark owner, and infringement proceedings. This law protects your business or brand’s identity. It gives you the right to take legal action against any entities that try to imitate your brand.
Copyright is the exclusive legal right to original works. Unlike trademarks, you don’t have to formally register or pay fees for your copyright.
The Copyright Act 2021 lists down requirements you need for copyright protection, but in general, you are automatically granted your copyright the moment you create an original work. The Act also lists what these works are, the copyright owner’s rights, and what rights infringements entail.
In contrast, if you are planning to use a copyrighted work, you would need to acquire a license from the copyright owner. Make sure to avoid copyright infringement by only using works or creations that are your own or works that you have a license to use.
Running an e-commerce business can be a lot of work. Complying with the laws and regulations listed above, and possibly more, can also be a lot of work. But know that these provisions were set into place to protect not only the consumers but your business too.
It is indeed worthwhile to at least have a basic knowledge of Singapore’s e-commerce laws and guidelines, particularly if you plan to set up your own e-commerce business. However, it must be noted that the laws evolve, as e-commerce in Singapore continues to grow and also evolve.