Business Law: Essential Elements of Electronic Contract and Legislations for Online Commercial Transactions

Running head: BUSINESS LAW
Business Law
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1BUSINESS LAW
Table of Contents
Essay..............................................................................................................................2
Assessment 2 (a)............................................................................................................5
Assessment 2 (b)............................................................................................................9
References....................................................................................................................12

2BUSINESS LAW
Essay
Essential Elements of Electronic Contract:
A contract can be defined as a legally binding agreement between two or more
persons creating legal rights and obligations. For the creation of a valid contract six essential
elements must exist. These six elements can be described as-
1. Offer and Acceptance- for a contract to be valid there should be an offer and a
definite acceptance between two parties.
2. Lawful consideration- there should be lawful and real consideration of an agreement
3. Lawful object- the objective of an agreement should be lawful. Contracts with
unlawful or illegal object are considered voidable.
4. Free consent- free consent is another essential of a valid contract. Consent obtained
by unfair means would made a contract voidable
5. Capacity to Contract- all the parties of a contract need to be competent
6. Intention to create legal relationship- both the parties to contract should have an
intention to create legal relationship between them.
An electronic contract can be defined as an agreement enforceable by law that is
created, signed and executed electronically, usually over internet. Electronic contract or
e-contract is formed by agreement between two or more individuals using electronic
means such as emails.
Like any other contract an electronic contract is governed by the provisions of
the contract act of the country therefore an electronic contract like any regular contract
cannot be considered valid unless all the essential elements are satisfied.

3BUSINESS LAW
Legislations for Online Commercial Transactions
Although there are no specific legislation governing an online business in Australia,
the online businesses are subjected to common law principles and other legislations that
apply to general businesses.
The first legislation applicable is the Corporations Act 2001 (Cth) sets the
requirements for registering a company, and regulations and obligations of a company.
Competition and Consumer Act 2010 (Cth) in relation with Australian Consumer Law
promotes competition and fair trading between business and consumers.
Privacy Act 1988 (Cth) regulates the collection, use, storage and security of personal
information.
Spam Act 2003 (Cth) sets out the requirements for sending electronic messages and
prohibits sending unsolicited commercial electronic messages.
Patents Act 1990 governs the issues relating to patents, designs, trademarks and
protection for intellectual property.
The online businesses are carried on under the legislation of A New Tax Systeem
(Goods and Services Tax) Act 1999 (Cth).
Apart from the abovementioned legislations there are various Electronic Transactions
Acts that facilitate use of electronic communications for business and personal transactions
online. These ETA have been enacted as mirror legislation at Commonwealth and in each
State and Territory. The ETAs are:
 Australian Capital Territory: Electronic Transactions Act 2001
 Commonwealth: Electronic Transactions Act 1999
 New South Wales: Electronic Transactions Act 2000
 Northern Territory: Electronic Transactions (Northern Territory) Act