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BizReport : Ecommerce archives : September 19, 2014

FTC's new 'merchandise rule' to come into effect before Christmas

New Federal Trade Commission rule requires retailers to ship within 30 days of a purchase, gain the customer's consent to delay delivery or provide a full refund.

by Helen Leggatt

A new rule, that comes into effect just before Christmas, could ease the pain of no-show and late deliveries for festive shoppers.

The FTC's new 'Mail or Telephone Order Merchandise Trade Regulation Rule', which comes into effect on 8 December, 2014, apply to goods a customer orders by mail, telephone, fax or on the Internet. The rule also applies no matter how the customer pays or initiates contact.

The rule states that, when a retailer advertises goods for sale, they must have "a reasonable basis for stating or implying" that the goods can be shipped within a certain time. If, after taking an order, the 30-day window can't be honored, the retailer must gain the customer's consent to delay delivery.

If this can not be done, or the customer does not consent, the retailer must "promptly refund all the money the customer paid" for the unshipped goods. If the customer paid by check, cash or money order the refund must be paid by first class mail with 7 working days of the order cancellation. If the customer paid by credit the customer's account must be credited or a notification sent to the customer to advise that the account will not be charged. This must be done within one billing cycle.

Image via Shutterstock

Tags: customer experience, delivery, law and regulation, retail, shipping, trading

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