E – COMMERCE AND CONSUMER RIGHTS: APPLICABILITY OF CONSUMER PROTECTION LAWS IN ONLINE TRANSACTIONS IN UGANDA

Uganda in the recent years has been experiencing an exponential boom in e- commerce. New e-commerce websites have sprung up almost over night and proliferated the market. This increase, facilitated the need for consumer protection laws in the Online sphere; in the form of the Electronic Transactions Act 2011, the computer misuse Act & the Electronic Signatures Act, 2011.

E- Commerce though not specifically defined in Uganda’s consumer protection legislation, is in general parlance defined as activities that relate to the purchase and sale of goods and services over the Internet.

E- Commerce websites like Hello Food & Kaymu have revolutionized trade in Uganda not only for the traders but the consumers as well. Online traders have benefitted from transcendent borders for the sale of their products; the consumers of goods and services have been provided with the luxury of convenient & comparative shopping and also the fast, efficient & hustle free delivery of online purchases.

The Electronic Transactions Act 2011, the Computer Misuse Act & the Electronic Signatures Act, 2011, were thus enacted to provide a seemingly comprehensive legal framework for e-commerce.

In Particular, The Electronic Transactions Act, 2011 essentially provides for the use, security, facilitation and regulation of electronic communications and online transactions.

The Act (together with the Electronic Signatures Act, 2011) also significantly provides for the legal recognition of electronic records & signatures; which guarantees effective enforcement of the rights of consumers, if infringed.

A point of concern, is that in the acceptance of e-contracts, there is a fundamental derogation from the principles of a valid contract like capacity to contract, among others. For example, because of the anonymous nature of online accounts, it is difficult to distinguish between a person competent to contract or otherwise when transacting online. This often results in minors, lunatics and other incompetent people entering into contracts that would otherwise have been illegal.

Also, is the issue of freedom of contract. Online users usually enter into contracts known as “click-wrap contracts”. Click-wrap contracts are entered into when a consumer assents to terms and conditions provided on a website or application by way of clicking on an "I agree" icon.

Usually, at the point of assent, consumers do not have the opportunity to negotiate the terms and conditions due to their impersonal nature. Thus, there is no other option, except, to accept the terms of the contract, if the consumer wants to proceed with an online transaction. This may be seen as a limitation to freedom of contract.

Another major concern is that surrounding the jurisdiction of cases in the event of a dispute. Essentially, one of the considerations for determining jurisdiction for purchases made online is where the contract was concluded i.e. where the cause of action arose.

However, things may become very complicated or impractical in case of online transactions as a consumer can access a website anywhere in the country. It is thus difficult, when instituting legal proceedings to clearly determine territorial jurisdiction.

E-commerce transactions are also clouded by the issue of data protection. The data that is made available online by the consumers is open to abuse and this is one of the major concerns that have emerged in the recent times.

Because there is no express legislation for Data protection, the terms of data protection are dependent on the contract that the parties have entered into. The disclosure and non-disclosure of data would thus depend on that contractual relationship or the existence of a privacy policy.

Privacy is also a major concern in e-commerce transactions such as online banking. Most banks in Uganda, through Bank of Uganda have tried to mitigate the risks caused by online transactions by providing for additional authentication/validation based on information not visible on the cards for all on-line card not present transactions.

Some of these measures include using Chip and Pin cards in the place of Magnetic strip cards as a fraud prevention measure. In addition, banks have introduced more consumer friendly methods of curbing fraud and promoting online privacy such as introducing SMS alerts for all online transactions and allowing the customer to block his/her card also via SMS in cases of fraud.

Overall, although laws like the Electronic Transactions Act, 2011 have made major strides in securing online transactions, future amendments if any, need to address the pre-existing issues especially in this ever-evolving online world.

Kenneth Muhangi

Advocate

Intellectual property, Media law & international commercial Law practitioner. 

IMAGE RIGHTS & THEIR IMPORTANCE IN UGANDA’S LEGAL FRAMEWORK

In order to understand what image rights are, it’s probably best to understand where they fit into the wider music, cultural arts & sports industries.

 We have already seen how the likes of Stephen Kiprotich, with his endorsement of Aqua Sipi bottled water, Jose Chameleon endorsing idroid mobile phones and Golola Moses endorsing Hello Food, have all exploited their image as a brand.

By endorsing a product, these personalities, with their high profile and positive publicity, have the potential to increase a consumer's brand awareness, enhance a brand image and, as a result, increase consumer sales.

 Although Uganda does not recognize image rights per se, we still see a plethora of contracts providing for image rights. The rights licensed or assigned in these contracts are essentially a combination of rights, including copyright, trade marks, privacy rights, and passing off rights (preventing false endorsement claims).

 In any image right licence, one of the key factors is to ensure that the aspects of the individual’s image and the rights protecting that image are clearly defined. In a case involving Wayne Rooney, a Manchester United footballer, the Courts have defined an image right as:

 "Image Rights means the right for any commercial or promotional purpose to use the Player's name, nickname, slogan and signatures developed from time to time, image, likeness, voice, logos, get-ups, initials, team or squad number (as may be allocated to the Player from time to time), reputation, video or film portrayal, biographical information, graphical representation, electronic, animated or computer-generated representation and/or any other representation and/or right of association and/or any other right or quasi-right anywhere in the World of the Player in relation to his name, reputation, image, promotional services, and/or his performances together with the right to apply for registration of any such rights."

 The biggest problem celebrities face is that their images or likenesses are often used to endorse products and services that they may not even know about. It isn’t uncommon to see images of celebrities like Bobi Wine propped up on the windows and sign posts of a Salon or night club.

 Perhaps the most useful legal tool for a celebrity such as Jose Chameleon, is the ability to pursue an unjust enrichment or passing off action where his name, image or likeliness is used in a way which falsely suggested that he endorsed another's goods and/or services.

 In the UK, a Formula One racing driver, Eddie Irvine brought an action in passing off against a UK radio station, Talksport. Talksport had doctored a photograph to show Irvine holding a "Talksport" branded radio. This photograph was then used on a brochure advertising the radio station. Irvine claimed that the doctored photograph falsely suggested that he endorsed the Talksport radio station and that he had suffered loss and damage as a result.

 The Court of Appeal awarded Irvine damages of £25,000, which was considered a reasonable royalty fee for endorsing Talksport.

 In sports, football in particular, Ugandan clubs have traditionally paid their players solely for playing football. However, owing to the considerably low commercial value of the local football league, local clubs are now actively seeking out endorsements and sponsorships as ways of growing their revenue base.

When these deals are negotiated and concluded, the sponsoring company often uses some of the more recognized players to endorse certain products or as faces of the partnerships.

Most likely, these players are on a ride along and have little bargaining power. In more developed leagues like the premier league in England, valuable players set up image rights companies for a player, as commercial entities for exploiting their individual brands.

Once the company is set up, the player transfers their ‘image rights’ to the company; and, the company will contract with the player’s club and commercial partners. It may well be that any club deal limits a player’s personal deal options (i.e. Arsenal may ensure that its players cannot endorse another airline, even in a personal capacity, as Arsenal are sponsored by Emirates) or even seek to share in revenues from personal deals in return for seeking to source individual deals for players.

 Furthermore, under, for example, the standard English Premier League’s employment contract that each Premier League player enters into with his club, certain provisions allow for a club to use a number of its players to promote the club’s sponsors. It is however quite limited in scope as a club cannot use a star players image more than it uses images for the other players.

 A club must thus still separately contract with individual star players if they are to fully utilize their image rights.

Image rights contracts, if properly structured would thus be legitimate ways to structure payments to players in return for endorsing particular products and services.

 This would not only professionalize the league but also be a source of income to Uganda Revenue Authority. 

Ultimately, as image rights continue to develop and evolve in Uganda, the legislative arm of Government may be forced to formally recognize that sports personalities and celebrities alike have a right to publicity, which inevitably would include a right to prevent others from using their image without consent and adequate remedies to compensate.

Kenneth Muhangi

Advocate

Intellectual property, Media law & international commercial Law practitioner.

 

Social Media and Sub Judice rule

The advancement of technology in the field of television broadcasting and social media has had an exponential impact on conversations about ongoing interesting civil and criminal court cases.

These conversations that were for a long time only had by lawyers and politicians, are now instantly televised and published online; and eventually shared and re-shared by the millions of social media users around the world.

 In Uganda, this has been evident with the publication of high profile cases such as the Kazinda trial, the Ongwen Trial and most recently the 2016 Presidential Election Petition. On twitter & Facebook, hashtags like #UGpetition2016 have enabled users to follow minute by minute reporting and analysis on the 2016 Presidential Election Petition.

 Although this may be considered as a form of freedom of speech, this would be primarily based on a general fallacy that the internet is somehow a free speech zone to which criminal and civil law don’t apply.

 The Chief Justice of Uganda Hon. Justice Bart Katurebe has recently warned Lawyers & journalists about flouting the sub judice rule whilst reporting/posting about the 2016 Presidential Election Petition.

 The term “sub judice” literally means “under judicial consideration.” The rule was created to prevent legal practitioners and the general public from discussing an ongoing trial (mostly criminal trials), which comments might prejudice judicial officers or assessors; and thus eventually affect the outcome of a trial. Anyone commenting about a case or defendant in a way that could prejudice a trial could be prosecuted for contempt of court and imprisoned.

 The basis for the sub judice rule is that it is the role of the courts to deal with legal issues before it. The court’s role should not be usurped by others making public statements about how these issues should be dealt with.

 The contempt period begins when a charge is laid, a warrant is issued or someone is arrested (or with a civil case, when pleadings are filed), and finishes when the proceedings are over. In a criminal case, the proceedings end when someone has been sentenced, if convicted of the crime, or acquitted.

 When an exciting case goes to trial, journalists & social media users should be careful not to background the case beyond what is in the pleadings or what is directed by the court. This might happen for example, in instances where the media profiles an accused in an ongoing trial by reporting on the said accused’s previous convictions or reported cases of mischief related to the offence in question.  

 Journalists & social media users should specifically  be mindful to avoid:

  • Revealing prior convictions of an accused.
  • Breaching any non-publication order issued by the trial court.
  • Reports that imply guilt or innocence of the accused.
  • Reports including interviews that could affect witnesses.
  • Comments, as distinct from reports of the court case.
  • Pictures of the accused where identity is an issue
  • Reporting evidence.
  • Any contact with court assessors.

In England, nine people were in 2015 prosecuted for contempt of court after they posted on various social media sites, the name of a woman raped by a footballer. All nine claimed that they did not know it was a criminal offence to name the victim of a sexual offence; but ignorance of the law is no defense in England just as it is not in Uganda.

Although Ugandan laws do not expressly provide for publications on social media, publications on Facebook and Twitter are subject to the same laws that in practice used to apply only to the mainstream media.

 It is thus incumbent upon journalists, legal practitioners and social media users to respect the sub Judice law and  protect the sanctity of the Judicial process.

 Kenneth Muhangi

Advocate & social media expert.