Law in e-commerce & marketplaces

ARROWS lawyers know that the dynamic world of e-commerce and online marketplaces brings not only huge opportunities for your business, but also complex legal challenges that can lead to significant risks and loss of trust. In today's digital economy, where the lines between online and offline commerce are blurring, it is crucial for owners, managers, and investors to have a reliable legal partner at their side. It is not just about compliance with the law, but about strategic risk management that can affect your reputation, financial stability, and long-term growth.

(photo shows part of the ARROWS law firm team)

Online sales and marketplace operations are constantly evolving, bringing with them rapid growth and changes in regulations at both national and European levels. For companies with at least ten employees, business partners, and subcontractors, as well as for capital owners, this legal maze represents considerable chaos and potential loss of time.

Our goal is to give you peace of mind and confidence that your online operations are compliant with the latest legislation and protected from unexpected disputes and fines. With 20 years of experience in B2B legal consulting in the field of e-commerce, we understand your needs and offer solutions that are not only legally precise but also commercially sound.

What ARROWS law firm most often does for companies in this area

ARROWS law firm handles a wide range of legal matters related to online business for its clients, from the initial establishment to comprehensive international expansion and crisis management. Our services are designed to minimize your risk and ensure the trust of your customers and partners.

Establishment and formal requirements for e-shops and online platforms:

We assist with the proper establishment and registration of entities in the Commercial Register and obtaining a trade license, which is the cornerstone for legal operation and prevention of future problems. We advise on the choice of the appropriate legal form and business structure for e-commerce, including consideration of cross-border aspects for foreign companies operating in the Czech Republic.

Comprehensive contractual documentation and terms and conditions:

We draft and review terms and conditions for B2B and B2C transactions, ensuring compliance with Czech and European law, including the Rome I Convention. We also prepare and review privacy policies and cookie policies in accordance with the GDPR.

We draft and negotiate specific contracts, such as contracts with suppliers, wholesalers, investors, affiliate partners, influencers, freelancers, and co-marketing agreements. We also advise on contracts for domain names, hosting and IT services, logistics, and payment methods.

Intellectual property protection:

We secure the registration and protection of trademarks, copyrights, and patents for your products, content, and technology. We resolve intellectual property infringement issues and counterfeiting on online marketplaces.

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Regulatory compliance and consumer protection:

We ensure compliance with information obligations towards consumers prior to concluding a contract, including specification of goods, prices, and payment obligations. We provide advice on consumer rights, such as the right to withdraw from a contract and claim for defective performance, including recommendations for model withdrawal forms. We offer comprehensive compliance with regulations such as the Digital Services Act (DSA) and the General Product Safety Regulation (GPSR), especially for online marketplaces.

Tax and customs advice:

We assist with registration for corporate income tax and VAT. We provide advice on tax obligations and optimization of internal processes for time and tax efficiency. We address specific tax and customs aspects of cross-border e-commerce and dropshipping, including VAT rules and OSS/IOSS regimes.

Dispute resolution and debt collection:

We represent clients in litigation and arbitration involving contractual relationships, consumer protection, intellectual property, and other areas of e-commerce. We ensure effective debt collection and resolution of issues with defaulters.

The following table summarizes the key legal areas in e-commerce and their impact on your business, allowing you to quickly identify potential risks and understand how ARROWS can help you ensure peace of mind and confidence in your online operations.

Key legal areas in e-commerce and their impact on your business

Legal Area	Typical Challenges for Businesses	Potential Risks and Impacts
Contract Law	Drafting and reviewing terms of service (ToS), contracts with suppliers, partners, and investors.	Contract invalidity, disputes, time loss, financial damages, operational chaos.
Consumer Protection	Compliance with information duties, right of withdrawal, complaints handling, ban on dark patterns.	Heavy fines, reputational risk, loss of customer trust, lawsuits.
Data Protection (GDPR)	Proper data collection, processing and security, obtaining consents, handling data subject rights.	Massive fines, lawsuits, loss of trust, reputational damage, data breaches.
Intellectual Property	Trademark registration, copyright protection, dealing with counterfeits.	Loss of trust, financial damage, costly disputes, brand harm.
Tax and Customs Law	Correct VAT setup for cross-border sales, dropshipping, customs procedures.	Fines, administrative chaos, increased costs, delivery delays.
Cybersecurity	Protection against data breaches, phishing, malware, ensuring system security.	Financial losses, customer trust erosion, reputational risk, legal liability.
Dispute Resolution	Out-of-court and court resolution of conflicts with clients, suppliers, and partners.	Lengthy and costly disputes, time loss, damage to business relationships.

The 5 most common problems that ARROWS lawyers solve for e-commerce clients

In the dynamic environment of e-commerce, companies face a number of legal pitfalls that can lead to serious consequences. ARROWS lawyers have experience in solving these problems for clients on a daily basis, helping them avoid fines, loss of trust, and reputational risk.

1. Incompatible contractual documentation and insufficient consumer protection

Many e-shops and platforms use outdated or general terms and conditions that do not comply with current Czech and European legislation, such as GDPR, DSA, or specific consumer law.

This leads to gaps in consumer information about their rights, such as the right to withdraw from a contract within 14 days or to complain about defective performance within 24 months. Insufficient or misleading information about the identity of the trader, final prices, or payment obligations is common.

Such shortcomings lead to high fines from supervisory authorities, the invalidity of contractual provisions, an increased number of disputes with consumers, and a loss of customer trust. In the event of mass complaints, there may be a serious reputational risk and media coverage.

Insufficient legal documentation is not just a matter of formal compliance, but directly affects the smoothness and efficiency of operations. If the terms and conditions are unclear, the number of customer inquiries and complaints increases, leading to wasted time for internal teams and potential chaos in customer support. The cumulative impact of fines, disputes, and operational inefficiencies undermines trust and damages the company's reputation.

2. Personal data breaches and cyber risks

E-commerce companies collect vast amounts of personal data, such as names, addresses, email addresses, and payment details. Inadequate security of this data, unclear consent to its processing, or its unauthorized sharing with third parties poses a huge risk. There is a risk of data leaks caused by phishing, malware, or weak passwords.

GDPR violations can lead to astronomical fines. There is also the threat of lawsuits from affected parties and a massive loss of customer trust. An example is the Equifax case, where a data breach affected 147 million people and led to huge financial compensation payments. The use of artificial intelligence in personalized marketing increases the volume of data collected and thus the risk associated with its protection.

If AI systems are not designed with the principles of "Data Protection by Design" and "Data Minimization" in mind, there is a risk not only of violating the GDPR, but also of creating algorithmic bias, which can lead to consumer discrimination and other reputational risks. This underscores the need for legal and ethical audits of AI systems, which is a newly emerging area of legal services.

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3. Unfair commercial practices, misleading advertising, and "dark patterns"

Online marketplaces and e-shops face pressure to sell, which leads to the use of manipulative practices such as false time limits, misleading information about discounts, or hidden contact details.

Dark patterns—practices that distort or impair the user's ability to make an autonomous and informed choice—and greenwashing, i.e., misleading claims about the sustainability of products, are also being addressed.

These practices are contrary to the Digital Services Act (DSA) and the Unfair Commercial Practices Directive and can lead to huge fines of up to 6% of global annual turnover for DSA violations. An example is the investigation of SHEIN by the EU Consumer Protection Cooperation (CPC) network for practices such as "pressure selling" and "greenwashing." This undermines consumer trust and leads to significant reputational risk.

Regulators are increasingly focusing on "digital fairness" through the upcoming Digital Fairness Act (DFA). This means that legal oversight is shifting from mere legality to ethical design and transparency of online interfaces. Companies that fail to proactively address these new trends face not only fines, but also a permanent loss of trust and a competitive disadvantage in the future, more ethical digital marketplace.

4. Complications with cross-border sales and VAT

Selling goods to other EU countries or outside the EU, especially from China, involves complex VAT rules, customs procedures, and product safety checks. The huge increase in low-volume shipments—91% of which come from China—is overburdening customs authorities and increasing the risk of non-compliant or counterfeit products entering the EU market.

Incorrect VAT settings for cross-border sales, particularly in dropshipping, can lead to the need to register for VAT in many countries, causing administrative chaos and high fines. The proposed abolition of duty-free allowances for low-value consignments and the introduction of a processing fee could significantly increase costs and reduce competitiveness. There is also a risk of accusations of using goods produced by forced labor.

The "tsunami of shipments" from non-EU countries is driving the revision of the EU Customs Code and the introduction of a new EU Customs Authority. This means that existing "loopholes" in regulation are being closed and companies that have relied on less transparent import models will face increased scrutiny and the risk of sanctions. Proactive legal audits of supply chains and customs processes are becoming essential to maintain peace and stability.

5. Intellectual property disputes and counterfeits on online marketplaces

The online environment facilitates intellectual property rights infringements, such as the sale of counterfeit goods, unauthorized use of trademarks or copyrighted works. Marketplaces are now more responsible for the products sold on their platforms and must implement procedures for the rapid removal of illegal goods. New questions are also emerging regarding the ownership of content generated by artificial intelligence.

Companies face a loss of customer trust, financial losses from the sale of counterfeit goods, and costly litigation. Examples include the cases of L'Oréal v eBay (2011) and Amazon v Various Counterfeiters (2020), where the platforms were found liable for trademark infringement.

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With the growing use of AI to generate content such as marketing materials or product descriptions, a new legal gray area is emerging regarding copyright and potential unintentional trademark infringement. This creates a risk of future disputes and requires proactive legal assessment of AI strategies to avoid chaos and financial losses.

Practical scenarios and deep insight into the issues

ARROWS lawyers regularly deal with these issues in practice. Our experience in providing long-term services to our clients, which include more than 150 joint-stock companies and 250 limited liability companies, gives us unique insight into the real challenges you face. We combine expertise with practical examples to help you navigate the complex world of e-commerce law.

1. Comprehensive regulation and consumer protection: DSA, GDPR, and "digital fairness"

Digital Services Act (DSA) and General Product Safety Regulation (GPSR): A new era of responsibility

The DSA fundamentally changes the rules of the game for online platforms and marketplaces. It is no longer just about passive hosting of content; platforms are now actively responsible for the safety and legality of products on their sites. Key obligations for online marketplaces under the DSA include the rapid removal of illegal goods, informing consumers about the sale of illegal products (including retroactively for the past six months), ensuring the traceability of traders and products, transparency in terms and conditions and recommendation algorithms, and a ban on "dark patterns."

Very large online platforms (VLOPs), with more than 45 million users, have even stricter obligations, including regular audits and reporting. The DSA and GPSR are putting pressure on online marketplaces to become active "gatekeepers" for legal and safe products.

This means that marketplaces must invest in advanced technological solutions for monitoring and verifying products and sellers. For smaller and medium-sized e-commerce companies, this means they must be even more careful when choosing the platforms on which they sell and ensure their own compliance with regulations to avoid chaos and loss of customer trust if the platform fails.

The following table describes in more detail the key obligations of online marketplaces under the DSA:

Overview of key obligations of online marketplaces under the DSA

Obligation under the DSA	What It Means for Online Marketplaces	Why It Matters (Business Impact)
Removal of Illegal Goods	Implement procedures for promptly removing listings of illegal products.	Prevents fines and reputational damage, ensures peace of mind during inspections.
Consumer Notification	Notify consumers about purchases of illegal products (up to 6 months retrospectively).	Builds consumer trust, reduces disputes.
Trader Traceability	Verify the identity of business users and track product origins.	Reduces risk of counterfeit or illegal goods, strengthens trust.
Transparency of Terms	Provide clear information about terms of use and recommendation algorithms.	Enhances user trust, lowers complaint rates.
Ban on Dark Patterns	Interface design must not manipulate users into unwanted decisions.	Prevents fines, builds trust and positive reputation.
Respect for Trusted Flaggers	Process reports from “trusted flaggers” promptly and with priority.	Efficiently combats illegal content, reduces legal risk.
Measures Against Abuse	Ability to suspend sellers who repeatedly offer illegal products.	Protects the platform from dishonest traders, maintains user trust.
Transparency Reporting	Publish annual reports on content moderation and dispute resolution.	Increases accountability and transparency, builds regulator trust.
Specific Obligations for VLOPs	Additional risk management, audits, and data access for researchers.	Ensures compliance for very large platforms, prevents massive fines.

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The fight against "dark patterns" and "greenwashing" shows a shift from mere legal compliance to ethical marketing and design. Companies that proactively focus on building trust and transparency will gain a competitive advantage and reduce reputational risk. This requires not only legal review, but also collaboration with marketing and UX teams to ensure compliance with new ethical standards in the digital marketplace.

2. Contractual relationships and dispute resolution

Contract drafting and review

High-quality contractual documentation is the backbone of any e-commerce business. ARROWS lawyers focus on drafting and reviewing B2B and B2C contracts that are not only legally enforceable, but also understandable and practical. This includes terms and conditions, contracts with suppliers, distributors, partners, investors, affiliate agreements, service level agreements (SLAs), and license agreements.

Problem solving and disputes

Unfortunately, disputes are common in the online environment. These often involve issues with product quality, slow shipping, fraud, misunderstandings in terms and conditions, or non-payment. ARROWS has experience in resolving disputes ranging from domain names, trade secrets, and distribution issues to complex online fraudulent transactions. We provide comprehensive services in the area of debt collection, whether through out-of-court proceedings or by representing clients in courts of all levels.

The asynchronous nature of online transactions, where payment and delivery take place separately, is inherently more risky for disputes than physical trade. This means that careful and clear contractual provisions that anticipate potential problems, such as quality, delivery, or payment issues, are critical to minimizing risk and chaos. Legal prevention is much cheaper than subsequent dispute resolution.

3. Intellectual property and cybersecurity

Brand and content protection

In the online world, your brand and digital content, such as text, images, videos, or software, are constantly at risk of misuse. ARROWS lawyers help with trademark registration and copyright protection to keep your brand and content investments safe.

With the growing use of artificial intelligence in e-commerce, new questions arise regarding the ownership of AI-generated content and potential intellectual property infringements. Our lawyers help you navigate this new area to avoid disputes and reputational risk.

Cybersecurity and data protection

E-commerce is an attractive target for cyberattacks. Data breaches, whether caused by information theft, phishing, or malware, can lead to huge financial losses and damage to customer trust. In the event of a data breach, you may face legal liability for damages.

It is essential to have robust cybersecurity plans in place and to comply with regulations such as GDPR. Although AI offers enormous opportunities for optimization, its integration into e-commerce systems brings new layers of risk in the areas of data security and intellectual property.

Algorithmic bias can lead to discrimination, while AI-generated marketing materials can unintentionally infringe on trademarks. This requires a comprehensive legal audit of AI systems and processes to avoid future disputes and fines.

4. Tax and customs aspects

VAT and cross-border sales

Understanding VAT rules is crucial for e-commerce, whether it's VAT registration, filing tax returns, or the specifics of selling within and outside the EU. Dropshipping, while commercially attractive, is very complex from a VAT perspective, often requiring VAT registration and filing in every country where the end customer is located. The OSS (One Stop Shop) and IOSS (Import One Stop Shop) regimes can simplify compliance, but they must be implemented correctly.

Customs procedures and the "tsunami of shipments"

Low-volume parcels are overburdening customs authorities and increasing the risk of non-compliant or counterfeit products entering the market. The EU plans to introduce fees for processing cross-border shipments and abolish the duty-free allowance for low-volume shipments. This could have a significant impact on the costs and logistics of e-commerce companies.

The huge increase in cross-border shipments from non-EU countries, particularly China, is directly leading to regulatory changes in customs and VAT aimed at "leveling the playing field" and increasing control. This means that companies that have previously benefited from less stringent regimes will face higher costs, administrative burdens, and the risk of fines. It is essential to proactively optimize internal processes and tax strategies.

5. International expansion and ARROWS International: Your partner for global growth

E-commerce naturally transcends borders. However, expanding into new markets means navigating diverse legal systems and local regulations. ARROWS Law Firm provides legal services outside the Czech Republic thanks to the ARROWS International network, which has been built up over ten years. This means that even if you are dealing with client issues in Algeria, as we have done, or in other countries, you can be sure of comprehensive support under one roof.

Did you know that ARROWS lawyers have dealt with complex e-commerce regulation issues for a client in Algeria, giving us unique insight into international standards and helping to avoid significant fines? This experience allows us to offer deep and detailed expertise in international e-commerce law, demonstrating that we are true insiders.

International expansion in e-commerce is not just about logistics and marketing, but primarily about legal adaptation to diverse national and regional regulations. Without a strong international legal background, there is a risk of chaos, wasted time, and fines for non-compliance with local laws. The ARROWS International network directly addresses this problem, providing peace of mind and allowing clients to focus on business growth instead of legal obstacles. ARROWS International directly addresses this problem, providing peace of mind and allowing clients to focus on business growth instead of legal obstacles.

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Why ARROWS is your reliable partner in e-commerce law

ARROWS Law Firm has experience in being a modern and reliable partner for its clients, understanding the specifics of online business and providing comprehensive solutions under one roof. Our long-term experience and innovative approach guarantee your peace of mind and trust.

Our portfolio includes more than 150 joint-stock companies, 250 limited liability companies, and 51 municipalities and regions. This wide range of clients gives us a unique insight into the needs and challenges of different types of businesses in e-commerce. Our experience in providing long-term services to our clients is a guarantee of stability and reliability for you.

ARROWS is a modern company that uses artificial intelligence and modern methods for its clients. This allows us to analyze data more efficiently, predict risks, and optimize legal processes, which saves you time and money.

Thanks to our partner companies, we provide comprehensive services under one roof. This means that we not only provide you with legal advice, but also related services that save you time and eliminate the chaos of searching for different specialists. Our goal is not only to solve problems when they arise, but above all to prevent them.

We help you draft and revise contracts and guidelines, solve problems, and optimize internal processes to make them tax- and time-efficient. This gives you peace of mind and reduces the risk of future penalties. ARROWS works primarily for entrepreneurs. We understand your mindset, your goals, and the pressures you face. We are your strategic partner, helping you not only with the legal aspects, but also with the overall development and protection of your business.

Don't want to deal with this problem on your own? More than 2,000 clients trust ARROWS Law Firm, and we have been awarded the title of Law Firm of the Year 2024. Take a look at our references HERE, and we will be honored to help you solve your problem. The inquiry is free of charge.