Starting a web shop – legal regulations
Online shopping is growing unstoppably in the world, and the situation is similar in Croatia. This is supported by official data from the Ministry of Economy, Entrepreneurship and Crafts of the Republic of Croatia, which show that more than a quarter of Croatian small and medium-sized entrepreneurs are engaged in online sales.
These data are not surprising, especially if we consider that creating a web shop, or selling online, has numerous advantages over “classic” commerce.
Creating a web shop requires significantly lower startup and maintenance costs, your product or service offering is constantly available, and you achieve a greater reach of target customers. This means that starting a web shop allows you to do business without additional costs for hiring, renting and maintaining a business premises, sales take place 24 hours a day / 7 days a week, which ensures access to your products to a large number of customers, and thus improves commercial results.
Regardless of whether it is an expansion of your business or an independent activity – quality web shop creation is a key factor in business success.
1. Business entity registration
The first step in starting an online business is registering a trade or company, where, in addition to the main activity, you must also enter information society services in the register of activities.
2. Mandatory data
As prescribed by the Companies Act, the following data must be clearly indicated on your website:
Name and abbreviated name of the company;
Company headquarters;
Court where the company is registered in the Court Register;
Number under which the company is registered in the Court Register;
Amount of the company’s share capital, and whether the share capital has been paid in full;
If it has not been paid in full, it is necessary to state which part of the share capital has not been paid;
In the case of a joint-stock company, the total number of issued shares and their nominal amounts;
Surnames and at least one name of a member of the company’s Management Board
In the case of a joint-stock company, members of the management board, i.e. executive directors and the chairman of the supervisory board or board of directors;
Company and headquarters of the institution where the account is held and the number of that account.
In addition to the above information, it is useful to include the company’s OIB and, if you do business abroad, the VAT number.
The practice is to include the above information in the “About us” section, on the “Contact” link or in the footer of the page or web store.
It is important to note that the previous provisions of the Law apply to all forms of companies registered as j.d.o.o., d.o.o. or d.d., but not to crafts.
Tip: Be sure to check whether your website contains the above information, because according to the same Law, penalties are determined in the event of failure to provide the prescribed information up to a maximum amount of 6636.14 euros, or 930.00 euros for the responsible person.
3. Legislation
In order for purchases and sales through your web shop to be in accordance with applicable regulations and provisions, after you have opened a company or craft, or an appropriate regulated activity – it is time to study the six basic laws that need to be studied in detail before registering a domain, choosing hosting, or before you launch a web shop, and these are the following documents:
Consumer Protection Act;
Electronic Commerce Act;
Alternative Consumer Dispute Resolution Act;
Electronic Communications Act;
Obligations Act;
Trade Act.
Consumer Protection Act
The first law we will mention is the Consumer Protection Act, where you will find a list of obligations towards customers that you as a merchant must comply with. According to this Act, you are obliged to deliver to customers a purchase contract stored on a durable medium, or on a medium that allows access to the contract in an unchanged form within the optimal period of time after placing the order. Furthermore, it is important to mention the “Directive 2011/83/EU on Consumer Rights”, which has been applicable in all European Union countries since June 13, 2014, and according to which “consumers in all European Union Member States have the same rights when purchasing goods or services via the Internet, e-mail, telephone and when purchasing away from the trader’s business premises (street or doorstep sales), regardless of where within the Union they purchased the product or service” (Source: Ministry of Economy of the Republic of Croatia, Guide to Online Shopping). Finally, we will mention another important provision of the Trade Act, which relates to the conditions for terminating a contract. Namely, “the prescribed period for termination of the contract is 14 days and begins to run from the moment the subject of the contract is handed over to the consumer, except in the case of concluding a contract whose subject is digital content that is not delivered on a physical medium (as well as in the case of concluding a service contract, a contract for the supply of water, gas or electricity sold in unlimited volume or unlimited quantity and the supply of thermal energy), when the period of 14 days begins to run from the day the contract is concluded.
If the consumer exercises his right to unilaterally terminate the contract, the parties are not obliged to