In this article, we describe the top 5 things you should include in your website terms of use. Online sales in Australia have grown from about $675 million to $3.1 billion over the last seven years, showing that Australians now do a lot of business online. If you own a website, whether primarily for information dissemination, like a blog, or an online storefront, you must make sure you add a Website Terms and of Use to it.
Author: Millicent Nhepera, Law Graduate (LLB, LLM), located in Australia.
What are Website Terms of Use
Website Terms of Use are a legally binding set of rules that govern how people visit and interact with your website. They can be described as a contract on your website that people agree to when they visit the website. Website terms of use can also be known as “Website Terms and Conditions” or an abbreviation of that: “Website T&C’s”.
Website Terms of Use can be as basic or as detailed as you see fit. If there are things you want to outline to your customers that they can do on your website, that they are prohibited from doing and if you want to limit your liability where customers are using your website – you can include all of this in your website terms of use.
Why do you need to have a Website Terms of Use?
To protect your intellectual property: A lot of things on your website are your intellectual property. This can be in the form of blog posts that you have written or products that you are selling. Whatever the case may be, website terms can be written to ensure that your intellectual property is protected from theft and unauthorised replication and use.
To limit your liability: If someone makes a claim against you for damages that they may have suffered due to information from your website (including links to third party websites, viruses, etc), then your Website Terms of Use can assist in limiting your business’s liability. This is because users of your website agree to terms in your Website Terms of Use when they enter and use your website.
Things you should include in your Website Terms of Use
As we have seen so far, Website Terms of Use are a very important part of your website, not only to ensure your business is complying with the law but also to protect yourself. The needs of every website are different, depending on what you use your website for. Below is a list of the top 5 things that you need to include on your website.
1. An intellectual property clause
One very important elements is to include a clause protecting the intellectual property that is on your website. You need to state that your website has intellectual property that is owned by you, or, owned by a third party that you have permission to use. The Terms of Use here will expressly state that visitors to your website are prohibited from using your website for unlawful purposes. You may include the following things:
That visitors must not do anything that will infringe your intellectual property rights on your website.
They must provide truthful information when registering on your website.
That visitors must not use any spamming or robots to compromise the security of your website.
These terms will differ depending on what you use your website for. You need to ensure that your Website Terms of Use apply to and are easily accessible on your business’s website, and that the systems and platforms you are using behind the scenes compliment your Website Terms of Use.
2. A disclaimer limiting liability
This is used to limit your liability to your website visitors. It can be drafted to remove any warranties about the information that you have on your website. Website Terms of use will indicate that you are not claiming that your website will always be completely devoid of error.
Adding an appropriately worded disclaimer may therefore protect you from a situation where someone suffers some kind of loss, financial or otherwise because they relied on the information that they got from your website. You can explicitly state in your disclaimer that you will not be liable for the loss that they suffered from reliance on that information, and so limiting your liability.
Most online stores will have a feature where you create an account and have login details to that business. You can state here that visitors should not share their login information. In so doing, if they suffer any loss from doing so, you may not be liable for that loss.
You can also include an element about viruses that may affect the visitors’ computer system from visiting your website. This is where you can include an “at your own risk” element, so that in the event that there is some virus that affects visitors to your website, then you are not liable for that. Online viruses and malicious software that can be embedded into websites are rampant. Even with the best monitoring mechanisms, these may be difficult to detect. A clause like this is vital in this online environment to protect yourself and your business.
3. A jurisdiction clause
You need to state which laws are governing the use of your website. So, if it is Australia, you would need to state the country along with the governing State. If you have websites in multiple countries, then you would need to state the country and the laws that govern that as well.
In case of any legal action that occurs over your website about the terms of use, the stated jurisdiction will govern that particular claim.
4. A clause dealing with information Gathering
A Website Terms of Use can include information about how the visitor the visitor’s information is used when they visit and use your website. This can include the following:
Cookies- if your website uses cookies, your website terms of use must inform the visitor that your website uses cookies. Cookies are small pieces of data that are used to identify a computer. Using these on your website can improve the user experience because the user does not need to keep re-entering the same information. However, it is imperative that this is something that is added to the user, giving them the option to opt-in or out of cookies.
Credit card information - if people input credit card information on your website, then you will need to address how that information is managed. Is it through a third party? Does this comply with governing laws? Internet scams and the theft of information from websites is a serious matter and can lead to legal issues. Therefore, it’s important that your website terms of use address credit card information, storage and use.
5. A third party clause
Website Terms of Use can also include wording that aims to protect your business from being associated with or responsible for a third party website. This is particularly relevant if your website has links to another website from your own website. Your Website Terms of Use can state that you are not liable (or ‘responsible’) for anything that may happen from the website visitor clicking through to another website from a link you provided.
This is most useful for websites like blogs, which may run advertisements from their websites through third party companies like Mediavine or Google Adsence. If this is your business model for your website, you want to make sure that this element is adequately addressed. It is important that you protect your business from things that may go wrong as a result of a website visitor clicking through to an advertisement on your website. You want to make sure that you are not liable for any inaccuracies, content gaps, viruses or malicious code on the third party’s end.
Other terms
If you are running an e-commerce business, then there are other terms that you may have on your website, such as a Privacy Policy, Returns Policy and a Terms of Purchase. It is important to refer to these in your Terms of Use, stating that visitors to your website acknowledge that they have read them, agree to them, and are bound by them.
What you can do next
If you already have a website, it may be worthwhile to go back to revisit it. A Terms of Use for your website is a very important part of your online business, and you need to take time to make sure it is done correctly. You must make sure that Your Website Terms of Use are adequate and addresses the needs of your website and your business.
While it is easy to find Website Terms of Use on websites which may be similar to your business’s website, you must not go and copy those Website Terms of Use from someone else's website onto yours. This is an illegal infringement on someone else's intellectual property right (being their copyright). It is also tailored to another business, and not your own. If those Website Terms of Use relate to a different business, they may contain irrelevant content and not match what happens on your website. This may mean that you do not have sufficient protection from liability. Therefore, it is worth deleting these Website Terms of Use from your business’s website or having an experienced ecommerce lawyer prepare some for you.
If you do not already have a Website Terms of Use, get in touch with us, as we can assist you in creating terms of use that is sufficient and tailored to your business’s needs. There any many ‘standard’ downloadable Website Terms of Use online. However, these do not cater to and address the specific needs of each and every business and website. It is best to engage a professional to assist you in making sure you receive tailored and appropriate Website Terms of Use.
There are other elements needed in order to make a website compliant under Australian Law. Depending on the size of your business, this may include a privacy policy. You can read in more detail about it here. Preparing a privacy policy for your website is also something that our commercial legal team is able to assist you with.
Contact us at:
Farrah Motley | Legal Principal
PROSPER LAW - A Commercial Law Firm for Businesses
M: 0422 721 121
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