With the advent of technology, E-commerce portals have become a trending opportunity for the entrepreneurs to explore. Entrepreneurs are now providing services and goods with just a click away.
One can only avail services and goods through E-commerce after entering into an e-contract with the owner of such E-commerce portal. In basic language the contract here takes place through a digital mode of communication.
Electronic contracts are born out of the need for speed, suitability and efficiency. It is a contract modeled, specified, executed and deployed by a software system. E-contracts are conceptually very similar to traditional commercial contracts.
Types of E-contracts:
E-contracts, useful for E-commerce model are of two types:
- Browse-wrap Agreements: It is an agreement where the terms & conditions are located on a website which may or may not be connected to the main webpage of the E-commerce portal. Just by using the website one can bind themselves legally to the terms and conditions enumerated by the portal.
- Clickwrap Agreement: It is an agreement where the terms and conditions of the E-commerce portal are located along with a check box of “I Agree”. So, basically before accessing the E-commerce portal one has to scroll down every term and condition and then click “I Agree” tab.
Clickwrap or Browse-wrap:
The debate lies in the question that which contract should be used by the E-commerce portals and why. As we know, e-contract is no different than a contract on paper and hence the Indian Contract Act, 1872 which governs the manner of the execution of a contract in India will be applicable to e-contracts also.
As per as the provisions of the Indian Contract Act, 1872, a valid contract should have an offer, an acceptance, a lawful consideration and a lawful object. The Act has made it mandatory to make an offer and acceptance but has not determined any particular procedure of how the offer and the acceptance should be made.
If we compare Browse-wrap agreement and Clickwrap Agreement, the later makes it mandatory for the end user to give his express assent, by clicking the “I Agree” tab whereas, the Browse- wrap agreement has no such feature.
Clickwrap & Browse-wrap, both are enforceable and used widely by all online portals. But Clickwrap agreement is more likely to be a legally enforceable agreement as under this, the E-commerce portal puts the terms of the agreement directly in front of the end user and requires them to show that they affirmatively accept the terms by clicking a button.
Presently, India has no judicial history on the enforceability of the Clickwrap agreement but if we are to see foreign courts judicial history then in general, the courts are hesitant to enforce Browse-wrap Agreements while allowing the enforcement of Clickwrap agreements.
Hence, new start-ups while opening an E-commerce portal for their business should go for Clickwrap agreement in order to avoid any conflict in the future.