Frequently asked questions
What do I need to do if I want to let my customers pay via the Internet?
Companies known as payment service providers provide reliable and secure ways of making payments via the Internet. In addition to providing various payment options, services include customer credit rating checks with the relevant credit card companies and the safe execution of payments using appropriate monitoring functions.
Are there any particular customs formalities for virtually imported/exported services?
Electronic services are not subject to any customs formalities as the goods are not physically delivered to the customer. However, there must be documents available to the tax authorities that prove where the service was performed.
What are the arrangements concerning the payment of value-added tax if I sell software products from Switzerland to the EU?
There is a distinction to be made between software provided in the form of goods, in other words on a CD-ROM, and software provided as an online service by means of data transmission (e.g. by e-mail or customer download).
If software is sent abroad to customers in the form of goods, the customers have to pay the value-added tax applicable in their country at the time of import. Such exports are not liable to Swiss value-added tax. When it comes to an “online” delivery of software from non-EU countries to EU countries, a distinction needs to be made between individual and business customers.
Essentially, as far as individual customers are concerned, the provider has to calculate and pay the value-added tax for the particular EU country where the customer lives. By contrast, business customers are responsible for arranging this themselves (usual procedure).
If I am based in Switzerland and I buy a product over the Internet from a German website (xx.de) and am not satisfied with it, am I able to send it back? What law applies if the provider insists that I settle the bill?
For customers based in Switzerland, no basic provisions have yet been implemented in law concerning the right to cancel online purchases (the situation is different for EU consumers). A variety of parliamentary initiatives to improve consumer protection have to date been unsuccessful (as of January 2010). As such, the contract is valid and must be fulfilled by both parties. In other words, the customer has to pay (even if they return the goods). If the goods ordered are defective or breach the terms of the warranty, it is possible to withdraw from the contract (a process known as repudiation) as long as there is no alternative agreement (which is, however, commonly the case and means that the seller reserves the right to be given the opportunity to remedy defects).
The provider is of course free to allow their (Swiss) customers a return privilege or right to cancel if they so wish (this is common practice in certain industries). It is not possible to give a blanket answer as to which law will apply. Where a consumer transaction is involved, the consumer’s rights usually prevail.
Everybody is talking about e-commerce and e-business. I am also interested in taking advantage of the new information and communications technology in my own business. But where do I start?
It is best to take things slowly at first. Start by getting some experience of these new technologies yourself. Get yourself a convenient form of Internet access and an e-mail address. Reserve a suitable domain name. Familiarise yourself with the world of the Internet. Order a few things over the Internet yourself. It can even be an easy (and secure) way of conducting bank transactions.
Use the Internet as a way of finding information (you could even enter ‹‹www.google.ch›› and use a common term from your own industry as a search term). Take a look at what the competition has to offer and talk to your own customers and suppliers. You will soon realise how these new technologies can offer you support, reduce your workload, or possibly lower costs.
The next step is to set up your own website. This is not expensive and is a simple and effective way of making information available to your customers. Orders can be processed by e-mail or through a small online shop. For most companies, the Internet is one of a number of communication and sales channels. It has its advantages, but there are also disadvantages.
It would be a mistake to view the new information and communications technologies in isolation. For example, information on a website can support shop-based sales, which might in turn lead to increased visits to the website and so on and so forth. It is not just about customers either. Dealings with suppliers who are already involved in e-commerce can be made easier and cheaper. Finally, the Internet also offers access to numerous sources of information, if you know what you are doing.
What exactly is an electronic signature?
Electronic signatures (digital signatures) are based on an asymmetrical encryption process involving two different keys. One key is public (it is used to check the signature), whereas the second is secret (for creating the signature). Each person must have their own pair of keys.
The combination of private and public keys makes it possible to verify the identity of the sender of an electronically signed document. It can also establish whether the document has been amended since it was signed. Providers of what are known as certificate authentication services are required to confirm that a public key actually belongs to the person stated. They provide this confirmation in the form of a digital certificate.
For the most part, the legal validity of digital signatures is determined by contract (if at all). In some countries, however, there are already legal regulations in place which accord certain, particularly secure, digital signatures the same status as handwritten signatures within specific areas (e.g. for contracts which must be drawn up in writing). Having said this, it is now possible to conduct e-commerce in many areas without digital signatures.
When is a contract deemed to have been concluded within the context of electronic business? Is it when you send an e-mail or click an order button on an Internet site, or only when the electronic communication reaches the seller?
“Normal” rules concerning the conclusion of contracts also apply to electronic business. In other words, a contract only comes into effect if one party makes an “offer” and the other party declares its “acceptance”. Contrary to popular opinion, a customer order generally constitutes an offer rather than an acceptance. The seller is free to reject or accept this offer (e.g. with a specific declaration of acceptance in the form of a confirmation e-mail, or implicitly by making the delivery or debiting the credit card).
The time when a declaration is made (offer or acceptance) is the time when it is actually sent. This would be when an e-mail is sent as far as e-mail traffic is concerned or when the “order” button is clicked in the case of a website. The declaration only takes effect, however, when it becomes accessible to the receiver (i.e. when the e-mail reaches the recipient’s server). By contrast, the point at which the seller becomes aware of its arrival is generally immaterial.
Can I outsource the running of an Internet site to a third party?
This is certainly possible. Many companies do not run their websites themselves, but entrust this task to hosting providers for logistical, financial or security reasons. These organisations operate Internet servers which house their customers’ offers (websites, online shops, etc.). Customers are able to update websites via the Internet and receive order data and statistics on a regular basis. Everything depends on how the offer is programmed, so it makes sense to think about the choice of hosting provider when putting together your offer.
Caution should be exercised, however, if the creator of a website also offers a hosting service (in other words, if they offer to manage it on the Internet). This may make sense, but you should ensure from the start that you have the subsequent option to switch to another provider at any time (e.g. at the end of a month/quarter), without any problems, delays or costs. Such an option should be stated in the contract, and requires, amongst other things, that rules are established regarding rights to the website (and its address) and the publication of data.
What is the best method of online payment?
In principle, there is a wide range of possible payment methods: billing, direct debit, credit card, cash on delivery, or payment by mobile telephone. The choice of suitable payment methods depends on a number of factors. These include the type of customer involved and the associated risks, the monetary amount of the transaction, the location of the customer and the currency used. Other issues to consider are the customer's own preferences and national differences. Companies trading on the Internet frequently offer a variety of payment methods (e.g. credit card or invoice).
Is there a code of conduct or recommendations for those operating online shops and similar consumer offers?
Recent years have seen a number of recommendations, codes and quality marks come onto the “market”. There is a relatively comprehensive brochure available on this subject that is worth reading. It can be obtained from the Swiss Association for Standardization (‹www.snv.ch›) and is called “Elektronischer Handel - Anforderungen an Marktauftritt und Markttransaktionen” (SN 191001, CHF 122). It contains general principles that should be followed when attempting to enter the electronic business market and explains how transactions are conducted there, taking into account both Swiss and EU legislation. In addition, its recommendations form the basis for a pan-European project in this area.
Source: The brochure entitled “E-Business: Rechtliche Rahmenbedingungen in der EU und in der Schweiz” from the Euro Info Centre Switzerland (September 2003).