Electronic Commerce
With the entry into force of the amendments to the Law on Electronic Commerce and the new Law on Trade in 2019, e-commerce, or electronic commerce over the internet, finally emerged from the grey zone in Serbia, as the new rules cover, at least to some extent, legal transactions concluded online and regulate how and under which conditions contracts in electronic form have legal effect.
The Law thus regulates services provided at a distance, as a rule for remuneration, by means of electronic equipment for the processing and storage of data, at the individual request of the service recipient, and in particular online trade, which further includes offering data and advertising over the internet, searching on an electronic network and storing data about the service recipient. Under the Law, all of this falls within the concept of an information society service.[1]
In addition to proclaiming the freedom to provide services across borders over the internet, the Law defines a number of terms relevant to interpreting the rights and obligations of service providers, service recipients and consumers.
Since the Law on Electronic Commerce is lex specialis in relation to the Law on Trade, many general terms are defined by the latter as lex generalis, which applies whenever the law governing electronic commerce alone does not provide otherwise.
Accordingly, the Law on Trade defines an electronic platform as a means through which a person acting as an information society service provider, within the meaning of the law governing electronic commerce, provides the service of connecting parties trading electronically, while the person operating the platform may also sell its own goods or services through the same platform. An online store, on the other hand, is defined simply as a store on the internet through which a trader offers goods or services.[2]
As regards sales through online stores or platforms (electronic commerce), the Law treats them as a subtype of distance selling and defines them as a form of distance trade in which goods or services are offered, ordered and sold over the internet. Among other things, it may take the form of sales through online stores, which is also the basic form of electronic commerce, sales through an electronic platform (e-commerce platform), and dropshipping.[3]
We can conclude that the Law distinguishes three categories of electronic commerce:
- Online store (e-shop)
- E-commerce platform
- Dropshipping
An e-commerce platform thus serves to connect parties trading electronically, but also allows the platform owner to offer its own goods or services on it. An online store, by contrast, is a much narrower concept, limited to business in which a trader sells goods and services. The first two forms of e-commerce differ from the third, dropshipping, in that dropshippers, as intermediaries in the sale of goods and services, never handle the goods themselves, but forward the orders they receive to traders or manufacturers together with instructions on the delivery address.
Dropshipping
In recent years, dropshipping has become one of the most popular online business models. Some of the world’s largest companies, such as Alibaba, have grown into empires by creating platforms that enable dropshippers to sell goods and services worldwide.
In short, this type of e-commerce involves arranging delivery of goods from the manufacturer or seller directly to the consumer. It is a supply chain management method in which the online trader holds no goods in a warehouse or in stock, but only displays them on an online platform. When it receives an inquiry or order, it buys the goods from the manufacturer or a third party and has them delivered to the customer.
Contracts in Electronic Form
The Law confirms that a contract may be concluded, that is, that an offer and its acceptance may be made, electronically, in electronic form, and stresses that the validity of such a contract may not be denied on the grounds of its form. However, not all contracts can validly be concluded in electronic form. This applies to suretyship contracts and surety statements where the surety acts outside the scope of their trade, business or profession, to contracts which the law requires to take the form of a notarially solemnised document, and to all other contracts which special laws expressly exclude from electronic form.[4]
Contracts in electronic form are an essential element of any online business, as they set out the rules established by the seller or service provider which customers or users, once they have accepted them, must observe. It is therefore important to establish an appropriate legal framework governing the rights and obligations of the participants before starting an e-commerce business.
In the case of non-commercial online activity, outside e-commerce as such, the party making certain content available protects itself, by setting these rules in the form of terms of use, against use of that content contrary to the law and to the will of the right holder.
Contracts concluded in electronic form must be preserved, just like contracts made in traditional form, in order to prove the existence and content of the contractual relationship. The web platform on which e-commerce is conducted must therefore include a technical solution that preserves evidence of acceptance of the contract (the “signature”), in the form of a recorded consent code or in another appropriate manner. As a rule, this records the version of the terms accepted by the user and the time of acceptance, to the extent necessary to prove the conclusion and content of the contract.
Mandatory Content of the Advertising Message
In order to prevent misunderstandings and fraud and to protect inattentive buyers, the legislator has made the mandatory content of advertising messages a matter of public interest by setting out the conditions for their lawfulness:
• on receipt of the marketing message, the buyer must be able to clearly identify its commercial nature
• the sender of the commercial offer, or the entity whose goods or services are promoted, must be clearly identifiable
• every promotional invitation to submit an offer contained in a commercial message must be recognisable as such, even when free goods or services are offered
• the conditions under which an offer is made on the basis of a commercial message must be transparent
Sending the Advertising Message by E-mail
To protect the interests of buyers and service recipients, the legislator has regulated on several fronts how advertising messages may be sent by e-mail. Several Serbian laws govern this way of making commercial offers. They apply concurrently, so the requirements of each of them must be met.
First, the Law on Advertising, as a kind of lex specialis for advertising, makes the use of an e-mail address, as personal data of a natural person, subject to prior consent.
The Law on Electronic Commerce likewise provides that sending commercial messages electronically must be preceded by obtaining the consent of the person to whom such messages are addressed, and that the sender must regularly check requests to withdraw consent. The same rule is contained in the Law on Consumer Protection, which prohibits direct advertising by e-mail without the consumer’s prior consent.
Unlike these laws, the Law on Personal Data Protection does not prohibit the use of e-mail addresses for direct marketing on the basis of legitimate interest, that is, it does not limit this type of direct marketing to consent as the legal basis for processing personal data. However, legitimate interest as a legal basis for processing does not remove the obligation to obtain prior consent imposed by the laws mentioned above.
The GDPR takes a similar approach: its recitals specify that a legitimate interest may exist in processing personal data for direct marketing purposes where the individual has reasonable expectations and where there is a prior relationship between the recipient and the sender, such as that of a client and a seller or service provider. Alongside the GDPR as the general regulation, the so-called ePrivacy Directive also applies in this area, likewise as lex specialis, and regulates advertising by e-mail in more detail. Although at first glance the ePrivacy Directive makes sending commercial messages conditional on prior consent, it goes on to provide an exception that softens this strict rule, known as soft opt-in: it allows e-mails to be sent to existing customers if the trader obtained their e-mail address in connection with the sale of goods or services, advertises its own similar products or services, and gives them an easy and free opportunity to object, both at the time their e-mail address is collected and in every subsequent message.
Serbian law provides no such exception, so marketing e-mails in Serbia should be based on the recipient’s prior consent, which may be easily withdrawn at any time.
Time of Entering into the Contract
A contract in electronic form is deemed concluded at the moment when the offeror receives the electronic message containing the offeree’s statement that it accepts the offer. When buying through a website, this is as a rule the moment when the buyer receives the message by which the service provider accepts the order. A confirmation of receipt of the order, which the service provider must send without delay, does not in itself necessarily constitute acceptance of the offer.
Offer and Acceptance of the Offer
Understanding and correctly determining the moment of conclusion of the contract is important because the rights and obligations of the parties, that is, the effects of the contract, begin at that very moment. A commercial message as a rule does not constitute an offer within the meaning of the Law on Obligations. Rather, the buyer, by requesting a specific purchase (selecting goods, services, quantity, etc.) and stating that it agrees with the content of the contract, makes an offer to the service provider, which the provider accepts by sending an electronic message.
For a commercial message to constitute an offer under the rules of the law of obligations, it must be a proposal to conclude a contract made to a specific person and contain all the essential elements of the contract, so that the contract could be concluded by its acceptance. By contrast, catalogues, price lists, tariffs and other notices, as well as advertisements in the press, leaflets, radio, television or by other means, do not constitute an offer to conclude a contract, but only an invitation to make an offer on the published terms. A commercial offer made through a website can be added to these forms of communication that do not constitute an offer. We can conclude that either the service provider or the user may act as the offeror, depending on how the invitation to conclude the contract is worded and whether it contains all the essential elements of the contract to be concluded. Normally, goods or services displayed on a website together with their price and terms do not constitute an offer, since it is the buyer who, by choosing the type of goods or services, the quantity and the delivery method, actually makes an offer to the service provider, which the provider accepts by electronic message, at which point the contract formally takes effect.
Special Rules for Online Sales Agreed Through Electronic Messages
A careful reading of these legal provisions shows that the Law has made a kind of exception, or concession, for sales in which the parties, the buyer and the e-trader, agree on the scope of their rights and obligations through direct contact, electronic messages or a telephone conversation. The Law thus provides that the rules on the procedure for concluding contracts in electronic form, on contractual terms, on general terms and conditions (where they form part of the contract), on the languages in which the contract may be concluded and on the codes of conduct followed by service providers do not apply to contracts concluded by e-mail or by other forms of individual electronic communication.
This is the situation where the buyer contacts the seller directly with a message requesting certain information or offering to buy certain goods or order a service on certain terms. Once the parties reach agreement through direct communication and the seller confirms the offer in the same way, the contract is deemed concluded and the online sale may proceed.
Nor does the service provider’s obligation apply to confirm without delay, electronically and by a separate electronic message, receipt of an electronic message from the other party containing an offer or acceptance, where the parties reached agreement by e-mail or other individual electronic communication.
This obligation does not exist because, where the parties have agreed on the sale through direct contact, there is no point in requiring another electronic message confirming the concluded transaction.
General E-commerce Rules That Also Apply to Sales Through Direct Contact
The rules on the mandatory content of a commercial message preceding communication between the buyer and the e-trader apply regardless of whether the sale takes place through a dedicated online store or through a social media page. The commercial message must first be worded so that, when received by the buyer, it can be clearly identified as such and distinguished from other messages. It must also allow clear identification of its sender, the e-trader, who must prominently display its business name, registration number and registered address on the page where the commercial message is published. It follows that only legal entities, entrepreneurs or other entities registered for that purpose may carry on online sales as a business activity.
Furthermore, where a commercial message invites potential buyers to get in touch or make an offer, including indirect invitations through notices of discounts and promotions, the invitation must be recognisable and easily identifiable as such, and all the conditions relating to the buyer’s offer must be clearly worded, easily accessible and presented to the potential buyer unambiguously.
Trading through social media is also subject, by analogy, to the general rules on trade, price display, product labelling, sales promotions, discounts and advertising. An e-trader operating through social media must also comply with the rules prohibiting unfair competition and prohibited speculation. In addition, consumer rights reserved for distance selling, such as the right of withdrawal and the right to complain, apply in full to sales through social media.
The Right of Withdrawal from Online Purchases
One of the most controversial features of online shopping is certainly the buyer’s right of withdrawal, which is at the same time both a strength and a weakness of this type of transaction, depending on the point of view, that is, on the interests of one or the other contracting party. The right of withdrawal should also be approached in the context of abuse by the contracting parties, by finding an adequate way of formulating, and then interpreting, the statutory provisions so that this “side effect” is kept to a reasonable level, if it cannot be eliminated altogether.
The importance the legislator attaches to the right of withdrawal is best reflected in the e-trader’s obligation not only to allow the buyer to exercise this right, but also to inform the buyer in advance of the conditions, time limit and procedure for exercising it, and of the fact that withdrawal is not possible in the cases exhaustively listed by law.
A buyer who is a consumer has the right to withdraw from a contract concluded over the internet (or at a distance in general) within 14 days, without giving any reason for withdrawing from the purchase of goods or services, by a statement made on the withdrawal form or in any other unambiguous manner.
The e-trader must therefore, within a reasonable time after the contract is concluded, and at the latest upon delivery of the goods or the start of the service, provide the consumer on a durable medium with, among other things, the withdrawal form, which the consumer fills in and returns in the event of withdrawal.
Given the nature of online sales, the e-trader may enable the consumer to fill in and send the withdrawal form electronically, in which case it must inform the consumer in writing (including by e-mail) without delay of receipt of the completed form.
A statement of withdrawal sent in this way takes legal effect from the day it is sent to the e-trader.
If the consumer misses the 14-day time limit, the request will be considered late and the consumer will lose this right. The exception is where the e-trader has not informed the consumer of the right of withdrawal, in which case the consumer may withdraw from the contract within 12 months from the expiry of the 14-day period.
Refunds
Once the consumer exercises the right of withdrawal, the contract is deemed never to have been concluded, while the e-trader and the consumer retain the rights and obligations relating to the costs and conditions of returning what was performed. The e-trader must refund all payments received from the consumer, including delivery costs, except for additional costs resulting from the consumer’s express choice of a delivery method more expensive than the least expensive standard delivery offered by the trader, without delay and at the latest within 14 days from receipt of the withdrawal form. The e-trader must make the refund using the same means of payment the consumer used, unless the consumer has expressly agreed to another means of payment and provided that the consumer incurs no costs as a result.
Since the consumer is obliged to return the purchased goods, the e-trader may withhold the refund until it receives the goods back or until the consumer provides proof of having sent them, whichever occurs first, unless the trader has offered to collect the goods itself.
Return of Goods and Return Costs
After sending the withdrawal form, and at the latest within 14 days, the consumer must return the goods to the trader or to a person authorised by the trader. The 14-day period is met if the consumer sends the goods before it expires.
The consumer bears the direct cost of returning the goods, unless the trader has agreed to bear it or has not informed the consumer in advance that the consumer must pay it.
If the goods are damaged or otherwise lose value as a result of improper handling, the consumer will be liable for it.
The consumer is liable only for any diminished value of the goods resulting from handling them in a way that is not appropriate, that is, beyond what is necessary to establish the nature, characteristics and functioning of the goods.
Exceptions to the Right of Withdrawal
The consumer has no right to withdraw from the contract in the following cases:
• service contracts, after the service has been fully performed and the consumer is obliged to pay under the contract (if performance began with the consumer’s express prior consent and the consumer acknowledged that the right of withdrawal will be lost once the trader has fully performed the contract)
• goods or services whose price depends on fluctuations in the financial market which the e-trader cannot control and which may occur within the withdrawal period
• goods made to measure, that is, to the consumer’s specific requirements, or clearly personalised
• goods which are liable to deteriorate or have a short shelf life
• sealed goods which cannot be returned for health protection or hygiene reasons, if they were unsealed after delivery
• goods which, by their nature, are inseparably mixed with other goods after delivery
• alcoholic beverages whose price was agreed at the time of conclusion of the sales contract, which can be delivered only after 30 days from conclusion of the contract and whose actual value depends on market fluctuations which the e-trader cannot control
• contracts where the consumer has expressly requested a visit from the trader to carry out urgent repairs or maintenance; if, during that visit, the trader provides services in addition to those specifically requested or supplies goods other than replacement parts necessary for the maintenance or repair, the right of withdrawal applies to those additional services or goods
• sealed audio or video recordings or computer software which were unsealed by the consumer after delivery
• newspapers, periodicals or magazines, with the exception of subscription contracts for the supply of such publications
• contracts concluded at a public auction
• accommodation other than for residential purposes, transport of goods, car rental services, catering services or services related to leisure activities, if the contract provides for a specific date or period of performance
• digital content not supplied on a durable medium, where the consumer is obliged to pay under the contract, if performance began with the consumer’s express consent to its beginning during the withdrawal period and acknowledgement that the right of withdrawal is thereby lost, provided that the trader has also complied with Article 31(1)(3) and Article 32(2)(3) of the Law on Consumer Protection.
From the e-commerce perspective, the supply of digital content is particularly interesting, both because the online sale of this kind of goods accounts for a significant share of total e-commerce and because this form of purchasing intangible “goods” is the most convenient and the most dominant.
For this exception to apply, the e-trader must obtain the consumer’s prior consent where digital content is not supplied on a durable medium, as well as the consumer’s acknowledgement that such supply results in the loss of the right of withdrawal.
Right to Complain About Goods and Services Purchased Online
Complaint Notice
As with the right of withdrawal, the e-trader must inform the buyer in good time of the postal or e-mail address at which the consumer may lodge a complaint, and of any contract it has with a postal operator through which the consumer may, in the event of a complaint, send the goods back at the seller’s expense.
Independently of this obligation, before concluding a contract for the sale of goods or the provision of services, the e-trader must also inform the consumer, clearly and comprehensibly, in Serbian and, where required by law, in the language and script of a national minority, of how complaints may be lodged with the trader, in particular where they are received and how the trader handles them, as well as of the conditions for exercising the consumer’s rights relating to conformity.
Reasons for Filing a Complaint
The consumer may lodge a complaint with the e-trader in the following cases:
• lack of conformity of goods
• claims under a guarantee
• lack of conformity of services
• incorrectly calculated prices
• other defects
Non-conformity of Goods as a Reason for Complaint
Lack of conformity exists where the delivered goods do not correspond in quality and other characteristics to the goods ordered, that is, the goods covered by the sales contract. The e-trader is liable for the lack of conformity of the delivered goods if:
• the lack of conformity existed at the time of delivery to the consumer, regardless of whether the seller was aware of it
• the lack of conformity appeared after delivery to the consumer, if it results from a cause that existed before delivery
The e-trader is also liable for a lack of conformity caused by improper packaging, improper installation or assembly carried out by the trader or a person under its supervision, and where improper installation or assembly results from shortcomings in the instructions given to the consumer for self-installation or assembly.
The trader is not liable for a lack of conformity if, at the time the contract was concluded, the consumer was specifically informed that the goods did not meet certain objective conformity requirements and expressly agreed to this by a separate statement, in accordance with the law.
Furthermore, if the delivered goods do not conform to the contract, a consumer who has notified the seller of the lack of conformity is entitled to:
- require the seller to bring the goods into conformity free of charge by repair or replacement
- claim an appropriate price reduction
- terminate the contract in respect of those goods
As a rule, the consumer may choose between repair and replacement as the means of remedying the lack of conformity. The trader may refuse repair or replacement if they are impossible or would impose a disproportionate burden on it. The consumer may claim an appropriate price reduction or terminate the contract in the following cases:
• the trader has not completed the repair or replacement, has not remedied the lack of conformity in the manner prescribed by law, or has refused to remedy it
• the trader has not remedied the lack of conformity despite attempting to do so
• the trader has declared, or it is clear from the circumstances, that it will not remedy the lack of conformity within a reasonable time or without significant inconvenience to the consumer
• the lack of conformity is so serious as to justify a price reduction or termination of the contract.
Time Limits Relevant to Complaints
The moment the defect appeared is also relevant to the scope of the consumer’s right to choose. Thus, if the lack of conformity appears within 30 days of delivery of the goods to the consumer, the consumer may in any event choose between replacement, an appropriate price reduction or termination of the contract.
If the same or another defect appears after the first repair, a further repair is possible only with the consumer’s consent. If the consumer does not consent, they may claim replacement or an appropriate price reduction, or terminate the contract. Termination cannot be claimed if the lack of conformity is minor.
The seller’s liability for lack of conformity may be invoked if the defect appears within two years from delivery of the goods to the consumer. For second-hand goods, a shorter liability period may be agreed, but it may not be shorter than one year. The consumer must notify the e-trader of the lack of conformity within two months of becoming aware of it, and at the latest within two years from delivery of the goods.
If a lack of conformity appears within one year from delivery of the goods to the consumer, there is a rebuttable presumption that it existed at the time of delivery, unless this is incompatible with the nature of the goods and the nature of the particular lack of conformity, and the burden of proving otherwise lies with the e-trader.
These time limits do not run during the period the seller uses to remedy the lack of conformity, so the liability period is extended by the time the remedy took.
Taking into account the nature of the goods and the purpose for which the consumer acquired them, repair or replacement must be carried out within a reasonable time so that the consumer does not suffer significant inconvenience.
Lodging a complaint, or repair, replacement or termination of the contract, does not affect the consumer’s right to claim, in parallel and cumulatively, compensation from the seller for damage resulting from the lack of conformity, in accordance with the general rules on liability for damage under the Law on Obligations.
Complaint Procedure
The consumer may lodge a complaint orally at the point of sale where the goods were purchased or at another place designated for receiving complaints, by telephone, in writing, electronically or on a durable medium, presenting the invoice or other proof of purchase (a copy of the invoice, a card slip, etc.). Upon receipt of the complaint, the e-trader must issue the consumer a written confirmation or confirm receipt electronically, or provide the number under which the complaint is entered in the complaints register.
The e-trader must respond to the complaint in writing or electronically without delay, and at the latest within eight days from its receipt. The seller’s response must contain a decision on whether the complaint is accepted, the reasons if it is not accepted, a statement on the consumer’s request regarding the manner of resolution and, if the complaint is accepted, a specific proposal of how and within what time it will be resolved. This time limit may not exceed 15 days, or 30 days for technical goods and furniture, from the day the complaint was lodged.
The seller must act in accordance with the decision, proposal and time limit for resolving the complaint only if it has obtained the consumer’s prior consent. The time limit for resolving the complaint is suspended when the consumer receives the seller’s response and resumes when the seller receives the consumer’s reply. The consumer must reply to the seller’s response within three days of receiving it, and the seller must expressly inform the consumer in its response of this obligation, the consequences of missing the deadline and the suspension of time limits. If the consumer does not reply within that period, the consumer is deemed not to have agreed to the seller’s proposal.
If, for objective reasons, the seller is unable to meet the consumer’s request within the agreed time limit, it must inform the consumer of the extension, state the new time limit and obtain the consumer’s consent, which it must record in the complaints register. The time limit for resolving a complaint may be extended only once.
In the past, a common reason for rejecting complaints was that the consumer no longer had the original packaging. This practice was ended by a statutory provision expressly stating that the consumer’s inability to return the packaging cannot be a condition for accepting a complaint or a reason for refusing to remedy a lack of conformity.
The seller must keep a register of all complaints received and retain it for at least two years from the day the complaints were lodged. The register may be kept in electronic form, for example as an Excel spreadsheet, or as a bound book if the e-trader prefers. In particular, it must contain information on the complainant, the date the complaint was received, the goods, a brief description of the lack of conformity and the request made in the complaint, the date of issue of the confirmation of receipt, the decision in response to the consumer, the date that decision was delivered, the reasonable time limit for resolution agreed by the consumer, the manner and date of resolution, and any extension of the time limit.
E-commerce Legal Support
Every online business model also requires legal support. Even small companies selling through their own online stores need well-drafted terms of use or a user agreement, as well as a privacy policy as part of their compliance with personal data protection requirements. Beyond these two basic documents, depending on the form of the online business, an online trader or service provider may face a range of issues requiring further consultation, legal opinions or permits from the competent authorities.
Application of Other Laws to E-commerce
Where an e-commerce business targets natural persons as end buyers, given their status as consumers, the e-trader must also observe the rules on consumer protection, which are very strict because they are mandatory.
The Law on Obligations applies subsidiarily to all matters not governed by special trade rules, as confirmed by the Law on Electronic Commerce itself. It is particularly important for the rights and obligations between an e-trader and an information society service recipient who is not a consumer, that is, for relations between businesses.
If an e-trader chooses a specific field or activity involving goods or services that require special treatment, it should also take into account the special laws governing that field. The sale of certain goods or services requires prior authorisation from the competent authority or entails business rules different from those applicable to activities under the general regime.
Information on Service Provider Identity
From the legislator’s point of view, the transparency of the conditions under which e-commerce is conducted, and the precision and completeness of the offer presented to users through an online store or platform, are a matter of public interest. Serbian law therefore sets out in detail the minimum information that must be provided to users and that an offer of goods or services in e-commerce must contain. An information society service provider must keep certain information permanently available while carrying on its activity, such as the name or business name of the provider, its registered office, and contact details enabling users to communicate with it quickly and effectively, including an e-mail address.
Where an activity is subject to special regulations requiring prior authorisation, the provider must prominently display precise information on the activity and the country in which it is authorised, if possible with a reference to the individual act, its number and date and the issuing authority. Users should also be informed, in a prominent place, of the official rules governing the activity or of the website where they can be found, if publishing them on the page where the goods or services are offered would be technically demanding or impossible.
[1] Law on Electronic Commerce (Official Gazette of the Republic of Serbia, Nos. 41/2009, 95/2013 and 52/2019), Article 3
[2] Law on Trade (Official Gazette of the Republic of Serbia, Nos. 52/2019 and 35/2026), Article 3
[3] Ibid., Article 17
[4] Law on Electronic Commerce, Articles 9 and 10
Disclaimer: The information provided on this page is for general informational purposes only and does not constitute legal advice. While we make reasonable efforts to ensure that the information is accurate and up to date, laws, regulations and their interpretation may change. The application of legal rules to electronic commerce depends on the specific circumstances of each case. Readers are advised to seek professional legal advice before making any legal or business decisions.