Survey Finds Companies Fail to Disclose Important Contract Terms
In an effort to determine whether domestic and foreign companies are disclosing important information to consumers online, the Federal Trade Commission staff conducted an informal International Web Survey of 200 websites in 18 countries. The survey will provide important information to the Commission as it examines what types of disclosures and information online merchants give to consumers.
The sites were randomly selected from a random sample of 2,200 URLs provided by Dun & Bradstreet and included 100 domestic sites and 100 foreign sites. Sites were excluded from the survey if the text was not in English or the site did not offer consumer goods conducive to cross-border sales. The survey also included sites that did not allow consumers to buy goods online.
Overall, the survey found that most companies provided helpful general business information but did not provide important contract related information such as refund policies, cancellation terms and warranty information.
For example, of the sites that allowed consumers to buy goods online: Only 9 percent of the sites (four U.S. sites and seven non-U.S. sites) provided cancellation terms. Only 26 percent of the sites (16 U.S. sites and 15 non-U.S. sites) provided refund policies. And only 38 percent of the sites (nine U.S. sites and 37 non-U.S. sites) disclosed the applicable currency.
In addition, the survey found that only 29 percent of the U.S. websites explicitly stated the country of origin (versus 79 percent of non-U.S. companies). Only 21 percent of the U.S. websites noted any geographic restriction on sales and only 11 percent disclosed the applicable currency.
The survey was released at the FTC's two-day workshop on the Global Electronic Market Place. The workshop examined how to ensure effective consumer protection in international e-commerce. It looked at what types of protections consumers need online, such as disclosures, as well as how we can secure those protections.
Copies of the survey results as well as the agenda and Chairman Robert Pitofsky's opening remarks at the Public Workshop on the Global Electronic Marketplace are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC-HELP (202-382-4357); TDD for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.
Office of Public Affairs
Bureau of Consumer Protection