Do Not Make These 3 Mistakes In Your Online Business

It does not take much at all to set up an online business

. Register a new domain name, establish an account with Paypal, insert some copy in a do-it-yourself website, and you are all set. You are now an online business owner. You have done so without having to deal with lots of paperwork and no officious bureaucrats . You are gripped by a sense of unhindered freedom, and there are no rules to hold your back in your online business. Is this right? No. The wake-up call is that you have to observe the same laws in your online world as you do at your physical office. These are the three most frequently repeated errors of online business owners.

1. Getting "bit" by your web development agreement. Plenty of entrepreneurs hire a web developer to build on their brilliant idea. Opening an online business without having your attorney review the web development agreement is like opening a corner caf without reviewing the lease. If the developer buys the domain name or opens the hosting account, she owns itnot you. And you've just let your business become her hostage if there's a dispute. Make sure you control those issues --otherwise, [the web developer] could shutter your business in a nanosecond.

2.Not observing intellectual property rights Many business owners think cyberspace is up for grabs, but intellectual property laws still apply. If you are infringing on another's copyright, be prepared to get an unpleasant cease-and-desist letter from their lawyers, while you are in the midst of a big promotional campaign. Not only is that nasty, you'll have to go back to the drawing board for your marketing and redo everything at great expense, time and effort. Another consideration ' are you protecting your own trademarks? Copywriting your website requires a small $45 fee when you submit it to the U.S. Copyright Office. That way, if someone uses your trademarks and ignores your cease 'and- desist letter, you can launch a lawsuit. You may receive anything between $1,000 to $10,000 in statutory damages. Quite a good return on your investment!

3. Not having a coherent privacy policy. Cutting and pasting is common in cyberspace, and many business owners do that for putting together their website terms. This is a bad idea. Your website terms must be relevant to your business. Failing that, you may incur legal liability for not keeping to the policy you presumably have. For example, are you adequately safeguarding customers' private information? Are you disclosing the privacy policies of any third party vendors involved in your website such those which run your shopping cart, conduct any surveys, or whose newsletters you are reproducing in your content?

Find the legal authority on these issues, and read up on his or her opinions. Be aware of the required jargon, such a "FHA guidelines" if you are in real estate, or "Safe Harbor Act" if you have a social networking site. Laws governing online businesses change frequently. Make sure you stay on top of these changes.

Copyright (c) 2010 Ask The Business Lawyer

by: Nina Kaufman

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