Selling digital content or services
What are your legal obligations as a business when selling digital content or services?
Consumers buying from businesses based in Ireland or the EU have strong consumer rights. These rights are part of the Consumer Rights Act 2022 and apply to the digital content or digital services you sell on or after 29 November 2022.
This page covers your key responsibilities under consumer law on:
- Your legal obligations to consumers
- Resolving digital content/service issues where you do not meet your obligations
- Providing information to consumers
- Consumer right to cancel
This page is not legal advice. To fully understand the legal obligations that apply to your business, you should seek independent legal advice.
What digital content and services does consumer law cover?
Digital content
- You produce and supply in digital form that a consumer can download or buy on a DVD or disc, for example, films, games, music, e-publications
- You create based on the specific requirements of a consumer, for example, personalised digital greeting cards
- Is personal information created by the consumer, for example, content on their social media account
Digital services
- Where the consumer can create, store, share or access data. For instance, streaming services (for examples films, tv shows, games) or a social media account
- That you tailor to suit the specific requirements of a consumer, for example, creating a customised online training course
Where it does not apply?
Do others areas of consumer law apply if a product is used with the service or content?
Some physical products require digital content or a digital service to function correctly. For example, a consumer cannot use their mobile phone unless the operating software works. You have different legal obligations for this type of digital content/service. Read what you must do when selling products to consumers.
What are your business' legal obligations?
Subjective obligations
Every time you sell something to a consumer, you enter into a contract with them. Consumer law requires that you must always supply digital content/services as outlined in the contract. These responsibilities are known as subjective obligations. They include that your digital content/service must:
- Be supplied in accordance with the terms of the contract
- Fit the description provided to the consumer
- Provide the quality and quantity agreed with the consumer
- Provide the consumer with the features to carry out what was agreed
- Have all the accessories and instructions. This includes installation instructions
- Provide the updates covered in the contract
Objective obligations
Consumer law outlines that you must also provide what a consumer will reasonably expect when you supply the digital content/service. These are known as objective obligations. You must:
- Ensure that what you sell is fit for all the purposes that similar digital content/services are normally used for
- Provide the quality and features of similar digital content/services
Match any advertisements/labelling unless:
- You were not aware of them
- The advertisements did not affect the consumer agreeing to the contract
- Match any trial version or preview you gave the consumer
- Provide the accessories and instructions a consumer would reasonably expect
Other obligations
Right to supply
You must have a right to supply the digital content/service you provide. For instance, this could mean having a licence or permission to supply a digital element from a third party.
When there is a dispute, it is up to you to show that you have a right to supply. A consumer can end their contract with you when you no longer have a right to supply.
You must also supply the most recent version of the digital content/service that is available when you agree the contract. This always applies unless the consumer agrees to accept something different.
Consumer created digital content
If you provide digital content/service that allows consumers to create their own content, you:
- Cannot use their content for your own purposes, for example, in an advertisement
You must give a copy of a consumer’s digital content to them when they ask for it:
- Free of charge
- In a reasonable time
- In a commonly used and machine-readable format
When do these obligations not apply?
You must resolve digital content/digital service issues unless:
- You told the consumer that the digital service/content did not meet a particular requirement and they accepted
A consumer does not install an update within a reasonable time when:
- There was no issue with the installation instructions you provided
- The consumer knew what would happen if they did not install it
How long do your obligations to consumers last?
A consumer has the right to have their issue resolved for up to 6 years. The 6 years starts from the date:
- You supply a once-off digital content/service
- The consumer has a problem with a service you supply on a continuous basis
During the first year it will be up to you to show that the digital service/content was not faulty when you delivered it. After the first year, the consumer must show that the digital content/service was faulty.
How is your business required to resolve digital content and service issues?
You must resolve issues that occur when you do not meet your legal obligations to consumers. You must do this:
- At no cost to the consumer
- Within a reasonable time (the shortest possible time to fix the issue)
- Without significant inconvenience to the consumer
The consumer can ask for a refund or price reduction if an issue is serious. They can also ask for a refund or price reduction if:
- You did not resolve the issue
- You did not resolve the issue within a reasonable time
Depending on the circumstances, the consumer can ask for a refund or price reduction if previous attempts to resolve the issue have failed.
End the contract and get a refund
To end the contract, the consumer must:
- Inform you that they want to end the contract
- Return any physical items provided as part of the digital content/service to you, at your expense and without undue delay
- Stop using the digital content/service they are cancelling
You must refund the consumer for the time you were not providing the digital content/service in accordance with the contract by:
- Providing the consumer with a refund within 14 days
- Using the same payment method used to buy the digital content/service, unless you agree otherwise
- Cancelling any secondary service the consumer ordered with the main service – for example, a consumer orders a high definition streaming service after they buy a basic streaming service
Price reduction
The consumer must inform you that they are seeking a price reduction. The price reduction will be the difference between the price you agreed in the contract and the reduced value of the digital content/service due to the issue. Both you and the consumer should agree what an appropriate reduction is.
When the consumer has paid upfront, you must:
- Send them the refund for the price reduction within 14 days
- Use the same method of payment they used to buy the service unless they agree something different
- Not charge the consumer any extra fees
Withhold payment
If the consumer has not fully paid for the digital content/service, they can consider withholding payments that are due to you until you resolve their issue. The amount they withhold must match the reduction in value due to the issue.
What does your business need to provide regarding the consumer's right to information?
Under consumer law you must give certain information to the consumer before they buy. The information you have to provide will depend on whether you agreed the contract:
- In a physical store
- On their doorstep
- At a distance, for example, online, mail order, by phone
Information for all sales
For every sale, you must provide some key information to consumers. You must present it in a way that is easy for them to understand. You should provide it before they agree the contract to use your digital content/service. If there is a dispute about what information was provided, it is up to you to show you gave the information to the consumer. This information includes:
- Your name, address, phone number
- Details of the digital content/service – if not already clear
- The total price of the digital content/service (inc. VAT). Where you cannot calculate it in advance, you must explain how the price will be calculated
Other information, where it applies:
- Length of the contract
- Any additional charges
- If the consumer has a legal right to cancel
Information for doorstep and distance sales
When you sell digital content/services on a consumer’s doorstep or at a distance, you must also provide the following information:
- Your email address and your other online communication channels
- Details on payment and performance
- Details on delivery
- How to cancel the contract when it does not have a fixed length or automatically renews
- That the price is calculated based on a customer’s profile or online behaviour – when it applies
- The conditions that apply to deposits – when it applies
After you agree the contract you must:
- Give the consumer a copy of the signed contract or send confirmation within a reasonable timeframe
- Give this information to the consumer on paper unless they agree otherwise
Information for online sales
When you sell your digital content/services online you must also make sure that the consumer:
- Always knows when they are making a payment. This means that when they order by clicking a button, it must be clearly labelled with words indicating ‘obligation to pay’ or similar
- Can clearly indicate that they want any other services you offer. This means you cannot use pre-ticked boxes for additional payments
Information for online marketplace platforms
An online marketplace is a platform where businesses and/or consumers sell to consumers. If you operate one, you must tell consumers:
- How you rank the results for their online search
- Whether the seller on your platform is a business or consumer
- That the consumer is not protected by consumer law when the seller is also a consumer
- How consumer law obligations are shared between you and the seller/ business
The information should be in simple language and easy to find. It should also be accessible from where the service is offered for sale. For example, a link is provided to the information.
Situations that are not covered by the right to information
In a physical store a business does not have to provide the above information for everyday, low value items or where the information is already clear.
Contracts with a value less than €50 that you agree with the consumer at a distance are exempt.
What obligations does your business have regarding the consumer right to cancel?
Consumers have a withdrawal period when digital content/service is bought online, over the phone or on the consumer’s doorstep. This means they can withdraw from the contract and get a full refund up to 14 days from when the contract was agreed. This right extends to 30 days for doorstep sales. When a consumer uses this right, they do not have to give you a reason for cancelling.
Your obligations
Where the right to cancel exists, you must inform the consumer of their right to cancel and:
- How they can exercise this right
- What the timescales are
- That they will be charged a reasonable cost for any digital content/services they use before they cancel
- Provide the consumer with a cancellation form. It should be on paper unless they agree otherwise
Provide a refund, when applicable:
- No later than 14 days after the consumer cancels the contract
- Using the same payment method they paid with, unless they agree otherwise
- Cancel any secondary service the consumer ordered with the main service – for example, a consumer orders a high definition streaming service after they buy a basic streaming service
When you do not inform the consumer of their right to cancel:
- The cancellation period extends to 12 months from the date it was due to expire if you had provided the information
If you provide the information within this 12-month period, the withdrawal period expires:
- 14 days from the date the consumer receives the information for distance sales
- 30 days from the date the consumer receives the information for doorstep sales
Consumer obligations
When a consumer has the option to cancel their digital content/service, they must:
- Let you know within the withdrawal timescale
- Inform you in writing, if possible, where they don’t have to use your cancellation form
- Return to you any equipment provided with the digital content/service
- Not use the digital content/service they are cancelling
- Pay for any digital content/services they used during the cancellation period
- Revert back to a previous contract – when it applies. For example, a consumer is cancelling a premium streaming subscription service which replaced their contract for a standard streaming subscription. They still have 4 months left in the standard streaming subscription
If you have a dispute with a consumer about a cancellation, it is up to the consumer to show that they used their right to cancel.
When the right to cancel does not apply
The right to cancel does not apply in certain circumstances, for example where:
- You agreed the contract with the consumer in a physical store
- You customised the digital content/service to suit a consumer’s requirements
- You have fully provided the digital content/service that the consumer has paid for. The consumer had agreed they would lose the right to cancel
- The digital content/service was already provided free of charge to the consumer
- You have started providing the digital content free of charge to the consumer
- The consumer opened sealed audio/video recordings/computer software after delivery
