The question of the steps that online retailers of “age-sensitive” goods and services should take to verify the age of their customers has recently been raised at a high level amongst claims that increasing numbers of children are finding it very easy to purchase alcohol, pornographic material and access to online gambling services.
Labour MP Margaret Moran introduced a Bill to the House of Commons on 22 January 2008, “the Online Purchasing of Goods and Services (Age Verification) Bill 2007-08”.
Ms Moran proposed for it to be a requirement for online providers of “age-sensitive” goods and services, and those facilitating purchases of such goods or services (for example providers of pre-payment cards), to take reasonable steps to establish that customers are 18 or over before such goods and services can be supplied to them.
Her speech highlighted that many online retailers simply ask customers to confirm their age by way of a check box, which customers are required to tick confirming they are 18 or over, but then undertake no further verification, even on delivery of the goods in question. She acknowledged that it is not true that only legal adults can get credit cards and accepted that life for the online retailer is much harder because banks routinely provide legal minors (in some cases children as young as 11) with plastic cards, such as Solo or Visa Electron cards, which are widely accepted on every kind of website. She said the age-restraints on “age-sensitive” products and services had been put in place for a reason, yet recent investigations show that increasing numbers of children, via pre-payment cards, are easily able to purchase alcohol, watch pornographic films and gamble over the Internet.
This would indicate that self-regulation is not working and that the proposed Bill is very much needed.
There are a number of technological solutions available to online retailers wanting to take their responsibilities more seriously, or wanting to react to how the legislative/political scene may be changing. These include online ID cards. The gambling industry in particular is developing some solutions, not least because it is a requirement under the Gambling Act 2006 (which came into force in September 2007) for online gambling companies to introduce an age verification service which is not dependent on the method of payment used. Ms Moran said that feedback she had had from one online gambling company in particular said this could be achieved “without significant additional costs and without harming the customer’s experience”.
However, technological solutions are currently not without problems, as recent tales of identity fraud, data privacy and security issues connected with ID cards and online data banks demonstrate. Many retailers may well prefer to wait until the technological solutions have been more widely tested and are more widely available.
Though it seems unlikely that the Bill will be passed, not least because of the security implications of online ID cards/ online databanks of ID information and other solutions on the one hand, and the strength of the “pro-self-regulation” lobby on the other, the fact that it has been introduced at all could show that the tide is gradually changing. This in turn would mean that it is time for this issue to be addressed and for online retailers to consider what steps they should be taking to protect minors and comply with legislation prohibiting the sale of certain goods and services to minors.
If retailers do not want to implement technological solutions at this stage, they should perhaps consider operational checks such as limiting the types of cards that they will accept (for example only accepting debit cards), working with banks to find out what kinds of cards are issued to minors and how the cards can be identified as such, phoning the customer to confirm the order and carrying out a further check on delivery, in the case of goods.
Whatever steps an online retailer decides to take, they should be clearly set out in that retailer’s terms of business and clearly brought to the customer’s attention on the website and the customer should “accept” the terms of business, prior to the customer being able to place an order for the goods or services in question. Furthermore, the terms of business should make clear that the supplier can refuse an order for any reason and that any sale is subject to the age verification checks.
In fact, it is not just online age verification which needs to be thought about in the context of selling online. Selling via the Internet has many traps for the unwary, including compliance with Distance Selling and E-Commerce Regulations. Online retailers need to ensure they are familiar with the requirements placed upon them and have the procedures in place to ensure compliance.
For legal advice on doing business online or in connection with your terms of business, please contact Nicky Androsov at Clarkson Wright & Jakes Solicitors on nicky.androsov@cwj.co.uk.
