While the giants of Australian retail have been slow to respond to online competition, local shoppers have been looking for value on overseas websites. But do you have the same rights when shopping online internationally?

In Australia, whether you buy something in a bricks and mortar store or an Australian online store you have the same rights and are protected under Australian Consumer Law (ACL). However, the ACCC says that when you shop on international sites it may be difficult to enforce the consumer protection laws of other countries on your behalf.

Are Aussies being exploited?

Manufacturers and distributors like Maxwell, Sennheiser, Nikon and Nintendo take advantage of this cross-border confusion. They all note that there may be no recourse to their manufacturer warranties if the product isn't bought in Australia, which protects their supply lines and paves the way for the price discrimination between Australia and overseas.

For example, the warranty for photographic equipment distributor Maxwell states it "does NOT provide guarantees or rights to consumers who have bought goods from online vendors based overseas". It goes on to claim the ACL "provides no protection for such overseas-sourced transactions to Australian consumers".

This isn't strictly true though, as CHOICE mentioned in its submission to the IT Price Inquiry. "Australia's consumer protection laws provide recourse for online shoppers irrespective of whether the seller is based in Australia or overseas," we argued. "[It's just that] the enforcement of these laws may be more difficult to pursue when the seller is located overseas."

The ACL can also apply to parallel importers in Australia like kogan.com.au and dstore.com, no matter where the products are sourced from.

When Australian Consumer Law doesn't apply

There are situations where Australian Consumer Law doesn't apply:

  • When you buy from a private seller outside the normal course of commerce.
  • When products are bought by auction at a site like eBay (as opposed to buying at a fixed price on eBay).

Tips for international online shopping

  • An online trader should always provide their address, phone and fax numbers.
  • Read the terms and conditions on the site, and check the seller's policy on refunds and returns.
  • Check with the seller that what you're buying meets Australian safety standards.
  • If things go wrong, contact the ACCC or the consumer protection agency of the country you bought your goods from, like the Federal Trade Commission in the US.
  • You can also file a complaint with econsumer.gov if necessary, which is the global site that allows consumers to file cross-border complaints with the aim of resolving the complaints without formal legal action.

Returning goods bought on overseas sites

Our analysis of some major overseas websites found the return policies they offered aren't all that different to their Australian-based competitors. The sites we scanned offer returns for faulty goods, and many extend this to "change of mind" purchases, which is not an ACL requirement, though the cost of return postage will generally fall back on the consumer.

Not all overseas sites have policies in line with the ACL though. Hong Kong-based site dx.com  provides an Australian address that customers can return faulty goods to, and offers to refund shipping costs when the goods are faulty or the site sent out the wrong product, for example.

But for products subject to a manufacturer's warranty period like some mobile phones or laptops, the customer has to pay the shipping costs themselves for return to Hong Kong. This is different to the ACL, which says that if the item needs to be returned, the seller should arrange and pay for postage.

But return policies in contradiction to the ACL can also be found on Australian sites too. On dstore.com, they state the following with regards to manufacturer's warranties: "Warranty claims are handled by the manufacturer directly, so please contact them immediately an issue arises [sic.] and follow their returns policy and instructions". Under the ACL, the seller may send the goods to the manufacturer for repair, but they can't force you to deal with the manufacturer directly.

In general, the larger reputable websites we looked at have fair return policies and secure online credentials, whether they're based here or overseas. That said, many businesses don't even publish returns policies online. A survey commissioned by NSW Fair Trading in 2012 found only 52% of small to medium businesses in NSW sampled published returns policies online, and 48% didn't use a secure webpage for payments or collecting customer information.

So, regardless of whether you're dealing with an Australian or international business, always check the site's contact details and refund policy, and read any buyer reviews before handing over your hard-earned cash.