Navigating the ‘child locks’ of online retail

With statistics from Mintel showing that seven out of 10 children spend money online and with children increasingly growing up with the internet, many retailers operating online will undoubtedly have children among their customers. But what is the legal position for eCommerce businesses that transact with youngsters?

Enforcing a contract against a child

Every time a customer makes a purchase, a contract is formed with the retailer. However, contracts made by a minor (under-18s) for items other than necessities (such as food or clothing) are “voidable”. In other words, the contract will be enforceable against the retailer, but not against the child, so online retailers cannot take action if the child does not pay up. This also applies on the high street but for an online retailer it is much more difficult to assess the age of a customer.

It’s perfectly possible for a child to have their own debit card to make online purchases. Should the child change their mind however the seller would not be able to rely on normal terms of business and would have to offer a full refund. Even more problems can arise if a child uses their parent’s payment card without permission. In that case, the card is treated as if it had been stolen and the parent has an opportunity to deny the transaction.

In practice, online retailers may find these issues arise rarely, but it’s important they be aware of the strict contractual positions they are in should they find themselves in a dispute with a minor or its parent over a purchase.

Advertising to minors

Online advertising is governed by the self-regulatory rules in the CAP Code and enforced by the Advertising Standards Authority (ASA). The Code defines children as those under 16 years old – although it’s important not to see children as one group. An advert directed towards teenagers may not be acceptable for younger children.

There are some important rules to remember:

  • Adverts should not directly appeal to children or encourage “pester power” to persuade an adult to buy something for them;
  • Children must not be encouraged to take risks (such as talking to strangers or not following the Highway Code);
  • Children under 18 should not be sexualised;
  • Care should be taken around using potentially distressing or offensive images;
  • Children should not be made to feel inferior or unpopular for not having a product;
  • An advert should not exaggerate what an ordinary child could achieve using the product; and
  • Language should be simple and it should be clear if adult permission is necessary.

When adverts feature young people, it’s not the actual age of the models that is important, it’s how old they appear to be. For example, Levi Strauss fell foul of that rule when they published an advert showing three young people holding lit fireworks. The models were over 19 years old and wearing outfits from Levi’s adult range. However, the ASA said that because the models were shown from behind, they could easily be mistaken for younger teenagers and the advert was banned.

Age-restricted products

Certain products cannot be sold to minors – either online or offline. This includes tobacco, alcohol, fireworks and knives, amongst others. Age verification can be a particular challenge when selling online, and any retailer selling these products should ensure they have a reliable system in place. This could take the form of age verification on delivery, or only allowing customers to collect such items in store.

Selling alcohol, gambling products, lotteries, electronic cigarettes or food / soft drinks high in fat, salt or sugar (HFSS), also requires extra attention to advertising rules. There are media placement restrictions for HFSS food products to reduce the chance of children seeing them and these rules are actively enforced by the ASA. Adverts for the other restricted products should not be directed towards under-18s and such adverts should not be placed on a website where more than a quarter of the audience are children.

Likewise, eCommerce businesses using social media advertising should not rely on users self-reporting their age and should use all the tools available to ensure that adverts are targeted age-appropriately. For example, using ‘interest-based factors’ is permitted – using behavioural data to identify children who misreport their age but remain interested in content designed for their real age.

High risk online retailers

Online clothing retailers should be particularly alert, as YouGov figures show 37% of children choose their clothes themselves, so may well be shopping online.

Any product or website that is targeted at a particularly young market (for example an age profile of 18-23) should take particular care its advertising so as not to stray into the younger teenage group.

Sellers of ‘unhealthy’ food and drink should also take care. The CAP code says adverts must not condone or encourage damaging oral health care and nutritional habits. Adverts must not disparage healthy diets and, unless you’re advertising fresh fruit or vegetables, food adverts that are targeted at pre-school or primary age children must not include a promotional offer or use celebrities or licensed characters popular with children. Adverts should also not encourage children to eat more than they otherwise would.

Data protection

Finally, merchants capturing children’s data must remember their obligations under the General Data Protection Regulation (GDPR). For the purposes of the GDPR, a child is someone under 13 years old. There are specific protections for children’s personal data, because they are less aware of the risks, and parental consent is required. An e-commerce site that does not have transparent, child-friendly notices and fails to demonstrate it has adequate processes to limit the use of children’s data faces potentially hefty fines.