{"id":4294,"date":"2020-03-24T15:00:00","date_gmt":"2020-03-24T05:00:00","guid":{"rendered":"https:\/\/flippa.com\/blog\/6-legal-considerations-when-starting-an-online-business\/"},"modified":"2021-09-02T17:08:51","modified_gmt":"2021-09-02T07:08:51","slug":"6-legal-considerations-when-starting-an-online-business","status":"publish","type":"post","link":"https:\/\/flippa.com\/blog\/6-legal-considerations-when-starting-an-online-business\/","title":{"rendered":"Running Your Business: 6 Legal Considerations When Starting an Online Business"},"content":{"rendered":"

This is a contribution by Kyle Kroeger of Financial Wolves<\/a>,
\na blog about making money with side hustles to help you achieve financial freedom.<\/span><\/i><\/p>\n

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6 Legal Considerations When Starting an Online Business<\/h1>\n

You\u2019ve got a banging business idea. You have the perfect product or fantastic service. You\u2019ve got an excellent business team at your back.\u00a0<\/span><\/p>\n

All that\u2019s left to do is go online with your business and start raking in those dollars, right?<\/span><\/p>\n

Wrong.<\/span><\/p>\n

In this day and age, while it may seem incredibly simple to just go online, create a profile or page, and start your business, it\u2019s rarely that easy. Once you actually get into it, you\u2019ll face many hurdles and uncover various myths.\u00a0<\/span><\/p>\n

Don\u2019t think we\u2019re trying to discourage you. Not at all.\u00a0<\/span><\/p>\n

If you keep at it, put in the time and effort, and take the right risks, there\u2019s no reason why your business should not succeed.\u00a0<\/span><\/p>\n

What\u2019s more, considering the fact that more than <\/span>90% of purchases<\/span><\/a> will be done through e-commerce by 2040, building online business is definitely the place to be.\u00a0<\/span><\/p>\n

However, all we ask of you is that you be a little careful and take a few precautions. Especially when it comes to legal matters, to avoid any problems for your business later on.\u00a0<\/span><\/p>\n

So, think about this legal requirements checklist when starting an online business.<\/span><\/p>\n

 <\/p>\n

Trademark<\/span><\/h2>\n

We all know how important it is to choose the right name for your business. Not only will it help others identify you, but it will also help you position your brand. It\u2019s no different for an online business.\u00a0<\/span><\/p>\n

However, using a name that is already registered by someone else can bring you a lot of headaches. Therefore, you want to make sure the name you\u2019re using is available to use, and you\u2019re not causing any <\/span>trademark<\/span><\/a> infringement. Don\u2019t forget, just because the domain might be available, doesn\u2019t necessarily mean that someone isn\u2019t using that business name offline, so be sure to do your legal due diligence as a startup business and take the time to <\/span>check<\/span><\/a>.<\/span><\/p>\n

You may not be ready to apply for a trademark of your own, but it\u2019s essential to ensure that you\u2019re not using someone else\u2019s or it can put you in some hot water down the line, or if nothing else, cause you quite a bit of work if you find yourself forced to redo all of the branding work throughout your business.<\/span><\/p>\n

 <\/p>\n

Incorporate Your Business<\/span><\/h2>\n

Do you need to incorporate your business? Well, you certainly don\u2019t have to, but If you wish to protect your assets and stay free of liability, incorporating your business is the best decision. This means that you register your business as a separate entity so that you are doing business as the business, rather than as yourself.<\/span><\/p>\n

The most common way for small businesses is to register as a sole proprietor. This is relatively easy to do and doesn\u2019t require a lot of paperwork.\u00a0<\/span><\/p>\n

Alternatively, you can also register as an LLC or a corporation, which will give you even more protection. Even if you have a small blog you should consider <\/span>registering your blog or site as an LLC<\/span><\/a>. It never hurts to be protected.<\/span><\/p>\n

 <\/p>\n

Business License<\/span><\/h2>\n

Just because you\u2019re operating online, doesn\u2019t mean you\u2019re let off the hook. There are still some procedures and rules that you need to follow and one of these is getting a business license.\u00a0<\/span><\/p>\n

Now, this could vary from place to place, and your local laws might not require you to get a business license to run your online business.\u00a0<\/span><\/p>\n

But when it comes to such matters, it\u2019s always better to be safe than sorry.\u00a0<\/span><\/p>\n

Therefore, check with your local business guidelines if you need to obtain a business license for the kind of business you\u2019re running.<\/span><\/p>\n

 <\/p>\n

Privacy Policy<\/span><\/h2>\n

Unlike physical stores, where a customer might come in, pay in cash, and leave, online businesses usually require more information during any transaction.\u00a0<\/span><\/p>\n

They might ask for customers\u2019 postal address, credit card information, or other sensitive information. Now, as a business, it\u2019s your responsibility to make sure all that information is protected and doesn\u2019t fall into any wrong hands.\u00a0<\/span><\/p>\n

So, you need proper privacy controls and policies which are set in place and followed by your employees as well.<\/span><\/p>\n

 <\/p>\n

Copyright Materials<\/span><\/h2>\n

When you\u2019re designing the page or website for your online business, you\u2019ll be tempted to include all kinds of cool pictures, videos, music, etc. After all, who doesn\u2019t want a visually appealing webpage?<\/span><\/p>\n

But just hold on a minute now. What sort of legal requirements are there when using images or music for your website?<\/span><\/p>\n

Are those pictures, videos, music, your creation? Or did you just pick them off somewhere on the internet?\u00a0<\/span><\/p>\n

If it\u2019s the former, then you\u2019re good to go. But if it\u2019s the latter, you\u2019re exposing yourself to the risk of <\/span>copyright<\/span><\/a> infringement suits. These infringements can put all of the <\/span>money you\u2019ve made online<\/span><\/a> at risk.\u00a0<\/span><\/p>\n

You want to make sure that any content you use on your website is your own creation or something you\u2019ve paid to use. This includes many things such as:\u00a0<\/span><\/p>\n