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Mankind never stops inventing. Decades ago, buying things from the store by just clicking a button is only available in science fiction movies. Now, it is just something common that people usually do in their daily lives. Scrolling up and down looking for the items that they desire and to buy them is just one click away. It is a concrete evidence which shows that technology will never stop moving. Law is also progressive, though it is not moving with a swift pace like technology does, law is always trying to keep up with all of the changes that occur in this world. Online transactions may be familiar to everyone, yet laws and regulations regarding it may seem unknown to some. This writing will talk briefly about the online transaction in a legal point of view, so it will not remain unknown.

Transaction (sale and purchase) is defined under as:

A sale and purchase is an agreement, under which one party binds himself to deliver a certain goods, for which the other party is pay the agreed price.

In terms of understanding online transactions, it is important to understand when actually a transaction  agreement prevails and when actually the ownership of the transaction object shifts. The answers can be found in Article 1458 of the Indonesian Civil Code, which states:

The agreement is deemed to have been concluded between the parties as soon as they reach consensus on the subject matter and the price, notwithstanding that the subject matter has not been delivered or that payment has not been made.”

And also in , which states:

The ownership rights over the assets sold do not transfer to the buyer until after delivery takes place…”

Basically, online transactions are the same with physical transactions. They have the same principles and the same idea.  The fact that transactions are based on agreements should not be forgotten as well. Therefore, it is important as well to understand the basics of agreement stipulates the following:

In order to be valid, an agreement must satisfy the following four requirements:

1. there must be consent of the individuals who are bound thereby;

2. there must be capacity to enter into an obligation;

3. there must be a specific subject matter;

4. there must be a permitted cause.

Requirements number 1 and 2 are known as the ‘subjective requirement’, while requirement number 3 and 4 are known as the objective requirements.

The basic stipulations above are still essential and relevant to the modern day online transactions. However, regarding Electronic Information and Transactions (“UU ITE”) specifically stipulates online transactions. Article 1 number 2 of UU ITE defines Online Transaction as a legal action which is done using computer, computer network, and/or other electronic media. Under Article 20 of UU ITE, it also stipulates that an online transaction occurs when an offer from the seller is received and approved by the buyer, this approval has to be made electronically.

Based on the mentioned prevailing laws and regulations above, buying and selling items through online media for example through the current trending e-commerce is actually legally known by the Indonesian law. Understanding the principles of online transaction is also important. It has to be known that the seller or the buyer has to satisfy the four requirements of a valid agreement as mentioned above. Not complying to the mentioned four conditions may lead to consequences as below:

  1. Cancellation

An agreement, in this context, an online transaction may be cancelled if the subjective requirement is not fulfilled. Cancellation means that, one of the party (buyer or seller) may request for cancellation to the court. The agreement will still prevail until a judge declare that the agreement is cancelled.

For example, if the buyer or seller is actually still under-aged to do any legal actions, thus one of the party may request for cancellation if this scenario occurs. To avoid problems that may rise due to this kind of incident, usually e-commerce uses a certain terms and conditions regarding the age of the users. The same thing applies regarding the consent of the buyer and seller.

  • Null and Void

Not fulfilling the objective requirements may cause an agreement to be treated as non-exist. This is more threatening than the previous consequence. Because the parties in this scenario, are not bound by any sort of agreement legally.

For example, if the buyer and seller are doing a sale and purchase of illegal drugs through online media, the seller is actually do not have any obligation to deliver the goods to the buyer since the item is illegal and so the requirement of a valid agreement is not fulfilled anyway. To avoid this kind of incident to occurs, usually e-commerce or online market place has strict terms and regulations regarding the items that are sold there.

Technology may help us to live more conveniently, everything can be done just by a click of a button. However, users have to be careful and understand that the legal aspects of online activities are also important in order to be able to make use of the rapid developing technology safely and not giving any negative consequences or losses to the users.

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