Bachelor's Degree

Business Administration

Subject
Commercial Law

Professor
Ariana Jazmin Govea Zamora

Group
E1- LAE- 401

Guillermo Escamilla Hernández

Activity
FINAL
 E-COMMERCE

WHAT IS IT?
E-commerce or electronic commerce is the distribution, sale, purchase, marketing
and information supply of products or services over the Internet. Aware of being at
the forefront, SMEs have not lagged behind in this new market, so they have made
the services of the network a place that allows access to their products and
services 24 hours a day.
Article 89 of the Commercial Code contains a list of definitions related to electronic
commerce, but does not include any definition of electronic commerce as such. For
this reason, it is necessary to use the definition of data message, which refers to
electronic media. According to this article, the data message is: "the information
generated, sent, received or stored by electronic, optical or any other technology".
The term "electronic media", according to this definition, does not refer to any
medium that allows the transmission of information through electricity, but only one
type of media. It does not expressly state what type of media it refers to, but by
exclusion it is inferred that it refers only to the "Internet", since there are other
"optical or any other technology" that allow the transmission of information.
On the other hand, it is contradictory to consider that "electronic media" is a term
that only refers to the Internet and that electronic media is not a category that
refers to any medium that allows the transmission of electricity information.
Unfortunately, there is no jurisprudence thesis so far that discusses this issue,
since it seems to be understood that when the law uses "electronic, optical or any
other technology", all instruments that allow the transmission of information by
means of electricity are included and that "electronic means" refers to the Internet.
For the purposes of this text, we will use the term "electrical media" in its most
general sense, i.e., as all instruments that allow the transmission of information by
means of electricity, so that in a single term we can include "electronic, optical or
any other technology".
WHAT WAS THE REASON FOR ITS CREATION?
You may well think that the history of e-commerce is closely associated with the
Internet. Today this is a reality, but in the beginning, it was not so.

All. born of catalog sales

You probably didn't imagine it, but the first step that was taken for what we know
today as ecommerce on the planet was catalog sales in the 1920s and 1930s in
the United States. This business model broke with everything that had been
established, because it allowed consumers to order their favorite products without
leaving home. Here the industry realized that the consumer wanted to shop, but
with the convenience of avoiding going to a physical store and taking the products
home with them.

The telephone was no longer just for talking to loved ones.

Catalog sales evolved as the telephone spread across the United States. And what
was used as a means of communication with family and friends became the
marketers' master tool. Telephone ordering changed the business model for many
companies, as they were able to understand that there was a real and abundant
market in this sector, and that traditional methods were not the only way to make
money.

The first credit card

In 1914 the money transfer company, Western Union, launched this financial tool
to the market. But it wasn't until the 1950s, with the popularity of telephone
shopping, that the public realized its value and usefulness, since you didn't have to
be present or have physical cash to pay for your products and services.

The real start of ecommerce

In 1960, a tool was invented that would change everything. Electronic Data
Interchange or EDI, a platform that made it easier for companies to transmit
financial data electronically, such as purchase orders and invoices. This stage was
fundamental for catalog and telephone sales thanks to the emergence of telesales.
Where, in between television programs, product demonstrations were shown and
consumers were allowed to call in to order these products and pay for them with
credit cards.

Electronic modernization of the catalog

In the late 1970s, the Englishman Michael Aldrich created a revolutionary concept,
which consisted of connecting a modified home television via telephone to a multi-
user computer processing line. In other words, it succeeded in making the first
computerized electronic sales transactions.

Its technology was applied in countries such as Ireland, Spain and the United
Kingdom in the first B2B (Business to Business) financial transfers, where
companies could buy and sell tourist packages, rent, sell and buy cars, make
money loans, access credit history, among others.

The Internet came to adopt everything

The World Wide Web or, the "hypertext project", initiated by Tim Berners and
Robert Cailliau and the lifting of Internet restrictions in 1991 for commercial use,
were the milestones that allowed the real and obvious leap in the history of e-
commerce to what we can see today.

Websites such as eBay, Amazon, which remain operational today and, not only
that, are undisputed industry leaders, were the last step for the consolidation of
ecommerce as a viable, profitable and exponential business model, adding delivery
methods such as dropshipping.

WHAT IS ITS USEFULNESS?

According to (M. Rojas, 2006) Electronic commerce or e-commerce consists
fundamentally of the development of market actions, sales, customer service,
portfolio management, logistics management and, in general, all commercial and
information exchange events carried out through the Internet. another definition
could be. e-commerce as the financial exchange that takes place over the network
between subjects that may be at a great physical distance, and which is generally
materialized by electronic means of payment.

Nowadays, E-Commerce has become a very successful tool for the business world
thanks to the openness and ease of access to the Internet.

WHAT IS THE JURISDICTION THAT SUPPORTS ITS EXISTENCE?

As we have already explained, the characteristics of transactions carried out

through electronic means, specifically the Internet, have a negative impact on the
trust required for a legal act to take place. These same characteristics are the ones
that prevent the State from regulating in detail every aspect of electronic
commerce, among which we can identify the following:

-Through the Internet, thousands of transactions can be carried out in an instant,

which makes it impossible for the State to monitor each transaction to determine its
existence and validity.

-It is excessively costly for the State to determine the identity of all persons
involved in a transaction carried out through the Internet, since any person can
access the Internet from anywhere without the need to identify him/herself.

-Due to technological advances, the cost of accessing the Internet is so low that it
has been possible for large sectors of the population to carry out transactions over
the Internet, regardless of place, time or day. This situation complicates the
application of the rules because, as already mentioned, the parties involved in a
transaction may be located in distant places from each other in the same country,
and some of the parties may even be abroad; likewise, the things traded may be
located in places other than those in which the contracting parties are located;
finally, payment may be made within the country or abroad.

HOW IS IT ACTIVATED? (PROCEDURES, REQUIREMENTS)

The existence of electronic commerce makes its regulation necessary, and it is

then that the United Nations Commission on International Trade Law created the
Model Law on Electronic Commerce, which contains the provisions, principles and
requirements that allow the treatment given to information on paper to be equated
with the treatment given to electronic information. That is to say, these provisions
make it possible to equate the treatment given to acts, businesses or contracts
contained in paper to the treatment given to these acts, businesses or contracts
contained in data messages, and also make it possible to equate the treatment
given to the autographic signature and the electronic signature or advanced
electronic signature.

Mexico, aware of this technological transformation in which trade operations are

immersed, has incorporated in its legislation provisions related to the regulation of
the use of electronic, optical or any other technology.

The commercial code contemplates that, in the acts of commerce, and in the
formation of the same (contracts), merchants may use electronic, optical or any
other technology.

With respect to the federal consumer protection law, it contemplates electronic

commerce and grants certain rights to consumers and obligations to suppliers in
transactions carried out through electronic means.

As for the federal civil code, it provides that contracts may be entered into through
electronic, optical or any other technological means, provided that the information
generated or communicated in its entirety through such means is attributable to the
obligors and accessible for subsequent consultation. These contracts have been
called electronic contracts.

The Federal Code of Civil Procedures grants evidentiary value to information

generated or communicated in electronic, optical or any other technology. Data
messages may be used as evidence in any proceedings before a legally
recognized authority.

Thus, in our legislation we currently have a legal framework regulating electronic

commerce, which mainly includes the Code of Commerce, the Federal Civil Code,
the Federal Code of Civil Procedures, the Federal Consumer Protection Law,
among other applicable laws.

THERE ARE THREE AREAS OF PROTECTION IN GLOBAL E-COMMERCE,

WHAT ARE THEY?

According to (A. Mendoza, 2004) There are three areas of protection in global e-
commerce: national, intra-community and international. In order to have a uniform
law on international electronic commerce, the Model Law on Electronic Commerce
was drafted in 1996. It is the first major legal text that formulates the bases and
limitations of ecommerce, from there, each territory develops its jurisdiction.

WHAT ARE THE TYPES OF E-COMMERCE?

BUSINESS-TO-CONSUMER (B2C)
Basically refers to products or services marketed from a business to individuals.
This is the most common modality and the one that paved the way for others. It
includes from the promotion of a product or service to the closing of the
transaction, payment and distribution of the product or service.

In this modality, the business faces two major challenges: attracting users or
generating traffic to the page, and building customer loyalty, since customers may
be attracted by other offers, lower prices, payment facilities and agile distribution.
Therefore, the business must take these variables into account and work towards
them constantly.

BUSINESS-TO-BUSINESS (B2B)
Not all companies sell to individuals, some only do business with other companies.
Business between companies can be very broad, ranging from the purchase of raw
materials to the provision of web content or portals. An example of this is web
development, since many organizations need to have a web page, so they hire a
company that is an expert in the subject.

CONSUMER-TO-BUSINESS (C2B)
Sometimes the traditional market concept (B2C Business-to-Customer) varies as
we encounter individuals selling a service or product to a company. An example of
this type of commerce is the freelance work of writers, photographers, developers,
etc.; who market their skills through networks or pages to companies.

CONSUMER-TO-CONSUMER (C2C)
This type of trade is between individuals who do not have an established business,
but may sell a service or product to another. For example, a couple places an
advertisement on a website to hire a photographer for their wedding, since the
person does not have an established business such a transaction can be
considered a C2C business.

CASE 1

Veronica has just opened her own website called ELEGANCE, focused on the sale
of products such as glasses, perfumes, handbags, shoes, etc. Each product is
perfectly described and the photos that are included illustrate in detail its main
characteristics; without a doubt a sample of all the effort put into the creation.

WHAT ARE THE REQUIREMENTS TO ESTABLISH YOUR TYPE OF

BUSINESS?
1. Find a niche market
The first thing you have to do is find a niche market. Focus on one type of product
and only sell that type of product. The more you want to cover, generally the worse
results you are going to get. Customers have to clearly identify you as a store...
You can't sell everything to everyone.

2. Study your competition

Take a look at other online stores that are up and running. Look for modest stores,
you can't expect to become the new Amazon overnight, nor are you going to
achieve it by reading articles like this one. Analyze pros and cons, strengths,
weaknesses, prices, etc. of your potential competitors.

3. Study your market

It would be good to know the demographics of your market. For this, you can set
up a test online store with Shopify, pick a few products that catch your eye from
your niche and try making an ad to sell those products to different types of
audiences. It will help you to know the characteristics of the people who would buy
from you.

4. Choose a platform for your ecommerce

There are many tools for creating online stores. Prestashop, Magento, Shopify,
WordPress and WooCommerce... we recommend that to create an online store,
you count on professional web designers who can do the job, so you don't have to
worry about the technical side.
5. Choose hosting and domain
Another essential part of your future online store is to choose a name, a domain
name and a hosting where it will be hosted. Here as web developers we can
advise you so that, depending on the characteristics of your store, you can have
the most appropriate hosting. It may also be a good idea to have a good logo
designed by a graphic designer.

6. Choose a management software

Your online store needs a management software to manage inventory, catalogs,
suppliers, invoices, etc. This work, which you will have to do yourself, can be better
managed thanks to an online tool that you can have connected to your online
store, so that the information is synchronized.

7. Upload your products

Buy products from your suppliers, and if you work with dropshipping, simply upload
the products through a CSV to your Prestashop or the platform you have chosen.
The products or product sheets must have a title, retail price, taxes, description,
image, etc.

8. Optimize contents
To set up your online store, you will have to optimize the content. For example, if
your suppliers' products already come with descriptions, that description will be
duplicated in many places. It does not help you to position yourself well. You need
original and user-oriented product descriptions.

9. Establish a strategy to achieve your first sales

Once your online store is set up and validated, you should design a marketing plan
to get your first sales and start making your business profitable. You can establish
discount policies, run contests or giveaways to new buyers, etc.
10. Take into account the legal aspect
Your website must have legal content and be adapted to the RGPD and the LSSI.
You must establish a return policy, general terms and conditions of sale, a legal
notice, a cookie notice, a privacy policy, etc. The best thing for this is that you can
request the services of advice and adaptation to legal regulations.

WHAT STANDARDS MUST BE MET FOR SUCH TRADE?

Fundamentally, the legal requirements for online stores do not differ from those for
physical stores. Online stores, like their local rivals, must comply with:
• the Ley de Ordenación del Comercio Minorista (Retail Trade Law),
• the Organic Law on Data Protection or LOPD,
• the Law on Information Society Services and Electronic Commerce
• the Law on General Terms and Conditions of Business
• the General Law for the Defense of Consumers and Users

WHAT OBLIGATIONS, BOTH COMMERCIAL AND FISCAL, MUST BE

FULFILLED?
Register in the Federal Taxpayers Registry (RFC). Your RFC is the unique
registration key with which you will be able to identify yourself to make electronic
invoices, deduct expenses, pay taxes and other essential procedures. You can
process your RFC online at the SAT portal.

Have an e. Signature. Also known as Advanced Electronic Signature (FIEL), it is a

key used to electronically sign your invoices and perform other digital procedures.
The e. Signature is processed in person at the SAT offices.

Define the tax regime. Before starting the tax registration process, identify the
differences between an individual and a legal entity and choose the tax regime
under which you will be taxed.
CURP or certificate of incorporation. The CURP (for individuals) and the articles
of incorporation (for corporations) are essential documents to carry out any of the
procedures mentioned above.

Proof of tax domicile. Last but not least, you need to have a tax address in
Mexico in order to comply with the tax requirements to open an online store in
Mexico.

WHAT IS THE TYPE OF E-COMMERCE YOU SHOULD USE?

B2C: Business to Consumer
It is one of the most widely used types of e-commerce on online platforms, as it is
directed from the business to the consumer. In other words, it is the one where a
company offers a product or service to those who directly need it. This is the most
common model for online stores.

REFERENCES

Pérez Porto, J. (2014, 2 October). E-COMMERCE. DEFINITION.OF. Retrieved

December 05, 2021, https://neoattack.com/neowiki/comercio-electronico/
Quiroa, M. (2017, December 7). COMMERCIAL LAW. ECONOMIPEDIA. Retrieved
December 05, 2021, https://idconline.mx/juridico/2013/06/10/marco-legal-del-
comercio-electronico