Many companies create a World Wide Web site as a promotional tool or even as a method of achieving sales.

The look and feel of sites is important and much time and money is spent creating a design that is attractive.

However, they also raise a number of important legal issues which are often ignored.

The very ethos of the Web and the Internet is one of freedom and there is little legislation that concerns itself specifically with either. However, it would be a mistake to assume that it is completely unregulated and that it can be used with impunity.

A number of statutes will apply, notably the Data Protection Act which creates compliance requirements which site owners should consider very carefully.

In addition it is possible for liabilities to arise through, for example libellous or negligent statements being made.

Until recently, most Web sites were used solely for marketing purposes. However, there is now a trend toward using them as sales channels. Contracting over the Web raises a number of complicated issues, notably the location where contracts are made and which courts have jurisdiction to enforce them.

They also cause a number of headaches for local taxation agencies as it is difficult to identify where the place of business is located and, therefore, where tax should be paid.

Needless to say, some businesses trading in this way are making the most of this confusion!

Forewarned is forearmed, and businesses seeking to establish sites should take advice about their potential liabilities and how protections can be put in place to minimise their exposure.

Michael Boyd is a partner at commercial lawyers, Pinsent Curtis.

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.