Business Ethics: Analysis of Internet-Based Contracting Issues

This report analyzes internet-based contracting issues for Great Buys, an internet-based enterprise selling household electronics. It examines online contract formation, requirements for performance and breach of contracts, and the development of enforceable methods for dispute resolution, including negotiation, litigation, arbitration, expert determination, and mediation. The report further suggests improvements to Great Buys' internal business procedures, such as closer collaboration between departments, strategic advertising, unique online content creation, enhanced internet security, and adherence to contract rules. The study concludes that internet-based companies should design and enact online contracts with the aim of providing proper security to online transactions, with a focus on adapting internal procedures to accommodate international law if expanding globally.

Running head: BUSINESS ETHICS
BUSINESS ETHICS
Name of the Student
Name of the University
Author’s Note

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Table of Contents
Introduction................................................................................................................................2
Analysing internet- based contracting issues of Great Buys......................................................2
Determining the requirements for performance and breaching of online contracts...................3
Development of enforceable methods for dispute resolution....................................................3
Suggestions for Great Buys for improving its internal business procedures.............................4
Conclusion..................................................................................................................................5
References..................................................................................................................................6

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Introduction
The main objective of this assignment is to analyse internet based contracting issues
such as online contract formation of Great Buys. This study also focuses on the determining
requirement for performance and breach of online contracts and develop enforceable methods
for dispute resolution. Great Buys in one of the internet- based enterprise that is
headquartered in New York which sells household electronics to the consumers in the US.
The management team of Great Buys is mainly concerned with its online contracting process
(Tekin & Liu, 2012). The study also recommends for Great Buys for improving its internal
business procedures.
Analysing internet- based contracting issues of Great Buys
Internet- based contracting creates legal problems for Great Buys as it has been
attempting to set up online contracting site. In few ways, internet is the perfect environment
to enter into contracts since several enterprise are discovering. On the internet, contract is
usually formed when bargain occurs in which there is mutual assent manifestation. Different
kinds of the online contracts may constitute offer or acceptance and thus the law of black
letter contract states that maker of offer has full right to define how offer can be accepted.
Therefore, one might post an offer on internet and define any kind of proper online conduct
as permissible manner to accept offer. Thus, demonstrating that the given act has been
intended to establish that acceptance of offer is much easier if conduct is unambiguous.
Online contract offers of Great Buys can be accessed by entire globe and becomes illegal as it
is made to individuals in specific jurisdictions or directed towards particular classes of
individuals (Cezar, Cavusoglu & Raghunathan, 2013). The regulators mainly seem to be
providing considerable weight to disclaimers in order to determine if web pages are
accessible in jurisdictions mainly constitutes local law violations. As in the internet world,

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computer programs might act as online agent and that the manager of Great Buys might be
bound by few offers as well as acceptances that are performed by computer.
The main internet based contracting issues faced by Great Buys are – client capacity,
electronic signatures, offer as well as acceptance in the electronic contract formation
procedure, conflicts of jurisdictions.
Determining the requirements for performance and breaching of online contracts
Most of the transactions of e- commerce such as Great Buys involves online contract,
which refers to an agreement that is designed, signed and executed over the internet. Online
contract is basically a communication between the two parties regarding transfer of products
and services. Breaching of online contract occurs when the two parties fails to perform
certain obligations in its contract. The requirement of performance as well as breaching of
online contract can be determined by the following-
 There must be legal considerations, which means that any kind of contract must be
enforceable by law (Österle, Fleisch & Alt, 2012).
 There has to be intention of creating lawful relations. However, if the party has no
intention to create lawful relationships, then no contract exists between them.
 There must be conviction as well as possibility of performance. This means that a
contract must be enforceable and thus must have option of performance.
 Details regarding breach of contract and claims of interest is also needed.
Development of enforceable methods for dispute resolution
There are some enforceable methods for dispute resolution in regards to Great Buys
contract issues which are illustrated below-
 Negotiation-In case of online contracts, Great Buys must negotiate directly with the
customers in order to settle down differences between them. This in turn can bring

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back proper communication between them. Moreover, negotiated agreement may
become a contract and be enforceable (Mackie & Mackie, 2013).
 Litigation- Litigation refers to the use of civil justice system and courts to resolve the
legal controversies relating to contract. Great Buys can use it for compelling opposing
parties in order to participate in solution.
 Arbitration- It refers to submission of disputed matters to the arbitrator for the
decision. Adoption of this method can help Great Buys to listen both sides and make
proper decision while making contract.
 Determination of expert- This method is a procedure of formal dispute resolution.
Great Buys must appoint a person in order to make proper decision by conducting
investigation (Rutledge, 2012).
 Mediation- It is a voluntary procedure in which mediator facilitates with
communication as well as promotes reconciliation between parties that permits them
to reach mutual agreement.
Suggestions for Great Buys for improving its internal business procedures
Great Buys can improve its internal business procedures by the following ways-
 Great buys should need closer collaboration between their departments for ensuring
consistent delivering of brand message to proper people
 Great Buys should advertise other sites for sponsoring advertising in order to attract
more customers (Mirrokni & Nazerzadeh, 2017)
 Great Buys should create content which is unique to online activities for increasing
customer’s interest in its online accounts.
 As there has been rise in cybercrimes, Great Buys must improve its internet security
in order to protect the consumer data.

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 Great Buys must make online contracts by following all rules and procedures
(Moringiello & Reynolds, 2012)
Conclusion
From the above discussion, it can be concluded that internet based company should
design as well as enact online contract with the aim of providing proper security to the online
transactions. In fact, if Great Buys starts selling its electronic products internationally, then
there will be application of international law. In that case, the management team of Great
Buys should focus on changing their internal business procedure in order to increase their
sales and improve performance in the market.
References
Cezar, A., Cavusoglu, H., & Raghunathan, S. (2013). Outsourcing information
security: Contracting issues and security implications. Management Science, 60(3), 638-657.

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Mackie, K. J., & Mackie, K. (Eds.). (2013). A handbook of dispute resolution: ADR
in action. Routledge.
Mirrokni, V., & Nazerzadeh, H. (2017, April). Deals or no deals: Contract design for
online advertising. In Proceedings of the 26th International Conference on World Wide
Web (pp. 7-14). International World Wide Web Conferences Steering Committee.
Moringiello, J. M., & Reynolds, W. L. (2012). From Lord Coke to Internet Privacy:
The Past, Present, and Future of the Law of Electronic Contracting. Md. L. Rev., 72, 452.
Österle, H., Fleisch, E., & Alt, R. (2012). Business networking: Shaping enterprise
relationships on the Internet. Springer Science & Business .
Rutledge, P. (2012). Convergence and Divergence in International Dispute
Resolution. J. Disp. Resol., 49.
Tekin, C., & Liu, M. (2013). Online learning in a contract selection problem. arXiv
preprint arXiv:1305.3334.