Shopping online is convenient, but it can be harder to sort out problems, especially if you buy from overseas websites.
How it works
Online shopping includes buying things through:
- websites or smartphone apps
- text messaging
- social media
- online auctions like Trade Me and eBay
- daily deal and group buying websites.
The Fair Trading Act and the Consumer Guarantees Act apply to offers and sales made through all of these channels, except when you buy from a private seller.
When you buy something online, you and the seller have entered into a contract electronically. You're bound by the same rules and laws as if you received a paper contract.
Contracts and sales agreements
Before you buy online
You can take some simple steps to protect yourself online: research websites before you buy, make sure the payment method is secure, and watch out for scams.
Some other things you can do:
- Avoid impulse shopping, especially with daily-deal sites.
- Read online feedback — but remember this feedback may not be genuine.
- Shop around — compare prices and conditions.
- Work out the total cost including any delivery charge, administrative fee, tax, duty or foreign exchange rate.
- Use a credit card if possible — it's more secure and if there's problem, you might be able to ask for a chargeback to reverse the payment.
- Be wary of offers that appear too good to be true.
- Check the Customs website for prohibited imports — there are some things you can’t import from overseas.
- Monitor children’s access — some businesses market directly to children.
- Avoid pyramid schemes, which are illegal — watch out for things like chain letters, ‘get-rich-quick’ schemes and home-based employment opportunities.
- Keep a record of all your purchases and keep all your receipts.
Read the privacy terms and conditions before you buy online. These tell you how the retailer will use your personal information.
Some common issues with buying online include:
- the seller not sending you the goods or delivering them late
- receiving products that are of lesser value or different from their description
- the seller giving you misleading information about a product or the terms of sale, or not including key information
- exchange rates and delivery costs making the products more expensive than you expected.
Only use your credit or debit card to pay online if the business uses a secure payment system. You’ll see a padlock icon in the window of your browser (but not in the webpage itself).
Your rights when buying online
Your rights — or your ability to claim those rights — depend on whether you are buying from:
- a trader in New Zealand
- an overseas trader
- a private seller on an online auction site, eg Trade Me or eBay.
Check the terms and conditions before you buy online, including returns, delivery and warranties.
Buying online from a New Zealand business
When you buy online from a business based in New Zealand and you are not happy with a product or service, you can ask for it to be repaired, replaced or for a refund under the Consumer Guarantees Act (CGA).
Refund, replacement, repair
Under the Fair Trading Act (FTA), online sellers on sites like Trade Me must clearly disclose if they are selling in trade. This means their business is selling goods, so the CGA applies if you buy from them.
You can claim compensation or cancel the purchase under the FTA if any auction website operators or online traders mislead you or make false claims about their products or services.
Some online traders don't hold stock. Instead, they source it once you place an order. They need to make this clear before you buy, and they must have a reasonable basis to believe they can fulfil the order. If not, they may be in breach of the FTA.
Buying and selling online(external link) — Commerce Commission
If the online trader arranges delivery, they're responsible for making sure the products arrive on time and undamaged.
Buying from daily-deal or group-buying websites
You have the same rights when you buy a business's products or services from a daily-deal site as when you buy from any other online trader.
Common problems include:
- not receiving what you ordered
- the business can’t or won't take your booking
- the business blames the daily-deal site and the daily-deal site blames the business.
If you have a problem, you can ask either the discount site or the business to put it right — it's up to you to choose which one. If the discount site tells you to sort it out with the business — or the business tells you to contact the discount site — they might be breaching the FTA by misleading you about your rights.
Often discount and daily-deal websites will sell you a gift voucher to redeem for hotels, restaurants, leisure activities, or beauty treatments. Rules on using these vouchers vary according to the discount website and the business selling the deal, so read their terms and conditions carefully before you buy.
Often vouchers have an expiry date. If you can't use the voucher before this date, eg no appointments available when you ring to book, ask for the service to be provided later. If a business takes a payment without intending to provide a service, this is a breach of the FTA.
Buying online from an overseas business
The Fair Trading Act is likely to apply, and the Consumer Guarantees Act might apply when you buy online from an overseas trader.
However, it’s harder to resolve problems and claim your consumer rights. Check the trader's website for terms and conditions including return, exchange or refund policies, complaints process, and any consumer laws that apply.
If you pay by credit card, you can ask your bank for a chargeback if your products don’t arrive. This reverses a transaction, meaning you get your money back.
Other things to be aware of:
- Calculate the final cost carefully, including delivery fees and currency exchange.
- GST might be added to the price, eg for products selling for NZ$400 or more.
- Exchanges, repairs and refunds take longer and may be more difficult to negotiate.
- Import duties and restrictions may apply — see the NZ Customs website for details.
Online shopping(external link) — NZ Customs Service
Buying from a private seller
If you buy from a private seller, eg on Trade Me, the Consumer Guarantees Act and Fair Trading Act don’t apply. You have the same rights as if it was an in-person private sale.
Data and privacy
If things go wrong
Your first step is to talk to the seller if you think:
- you have been misled
- the products or services are faulty or unsafe
- the seller did not have the right to sell those products.
Try to sort it out directly with the seller. If you can’t contact them, use the website’s dispute resolution process if available.
If you bought a voucher from a daily-deal site, ask the site — or the business providing the product or service — to sort it out. Both are equally responsible for providing a remedy. If they don’t fix the issue, you can take both the business and the daily-deal site to the Disputes Tribunal at the same time.
Place feedback on the website about the seller so others are aware of any problems. Be fair and accurately describe any issues or problems with the sale.
If you can't sort out your issue directly with the seller, our Resolve a problem tool has information to help you take the next steps. These may include going to the Disputes Tribunal or District Court.
Faulty products and services — Resolve a problem
Scams — Resolve a problem
Spam and cyberbullying — Resolve a problem
Example — Daily deals
A travel agent offers a cheap holiday package to Hawaii on a daily-deal site. He knows the offer is only available to the first 10 customers but doesn't make this clear in the terms and conditions. When the daily deal ends, more than 100 customers have bought it. The travel agent must honour those deals or he will be in breach of the Fair Trading Act for misleading the public.
Example — Not delivered, ask for chargeback
Jill is delighted to find a website that sells cheap trumpets from China, with delivery within two weeks. She places an order, and pays with her credit card. After four weeks, there is no delivery. She tries to contact the seller but gets no reply. So she asks her bank for a chargeback as the trumpet never arrived and the seller has not contacted her.
Example — Fake tickets
Chen gets a text message about tickets to a rock concert available from a private seller via a Facebook page. He messages the seller and buys two tickets. When he tries to go to the concert he finds out the tickets are fake. The Facebook page is no longer up when he tries to get in touch, and the text number doesn't work. Chen realises he has been scammed so he gets in touch with Scamwatch to warn others.