Buying from online retailers: issues of applicable law and enforcement. Which law is applicable for dispute resolution when buying from online retailers? Which courts have jurisdiction over the case?

Abstract

Expanded use of the Internet, credit cards and online/mobile banking led to development of e-commerce through all the world, including Armenia. A probable outcome of buying online might be getting an improper product or a defective item, or paying more than initially was planned (as the shipping cost is calculated depending on the weight of the product), or a difference might be between the product in the picture and what you actually get. In Armenia, most often people do nothing, or maybe contact the seller and negotiate whether it is possible to return the product and get refunded. But what should one do in case the seller refuses to refund after a negotiation? According to which law is the dispute going to be resolved? To which court the case should be brought? With the adoption of new technologies, nowadays buyers can select the products from the website of the seller, where the price, delivery conditions or payment methods are already mentioned and conclude a contract over the Internet. The parties can agree over the governing law of the contract by including a specific clause in it. Otherwise, for the contracting parties to the United Nations the Convention on Contracts for the International Sale of Goods (CISG) might apply. Currently, two-thirds of countries in the world involved in international trade, are contracting parties to the CISG 1980, including China and the US. So, in case of absence of applicable law clause, default rules of CISG apply. But CISG was adopted in 1980, which is much before the electronic commerce has started, so some new regulations were needed to certain electronic transactions. Therefore, the United Nations Convention on the Use of Electronic Communications in International Contracts was adopted in 2005 to complete CISG. As has been noted, there are more and more people involved in e-commerce year by year, and this is the reason why this field needs special regulations to apply for securing the transactions concluded over the Internet and for protection of the rights of both buyers and sellers.