Sept - Dec 2016
Global Digital Innovation
Edu Tech 


Watch your step in virtual market place – Online stores get legal

The digital age and relative ease of perusing, deciding and purchasing goods and services online together with the preponderance of media platforms have opened a trajectory of opportunity for online business.

The success of an online business begins with knowing your market, seizing the opportunity and knowledge of the legal and regulatory landscape.  

You are a business, an online one.  You are a standalone virtual online store or your online store may be linked to you physical business. Linking your online store to your business is a smart move as you have an existing customer base.  If you’re a solo virtual, you need to create a customer base.  Both forms of online stores require a smart online commerce strategy.  Online stores need be aware of the legal requirements of the legal, payment, business incorporation, tax and marketing aspects of a virtual trading store.  These aspects are key to ensuring a successful online legal trading presence.

Here is a list what online stores need to know:  This list is not exhaustive and you need to consult your lawyer for more detailed advice.

  1. Have you registered your business ?  Where is your business incorporated?  Is it a company, an incorporated or a sole proprietor?  This decision is key as you need to be aware of the legal and tax ramifications and requirements of the choices you make. Your choice influences decisions on equity partners if applicable a/mnd applicable corporate documents.
  2.  Is your company registered for tax?
  3. Enquire about Double Taxation Agreements (“DTA”) if your online business is registered abroad.
  4.  The big online commerce Vat issue for foreign companies selling digital goods in South Africa is still to be decided.  Do they or do they not register for VAT?  SARS spokesperson Adrian Lackay advises that “you may want to refer to page 59 of the 2013 Budget Review in Chapter 4. The exploration of how the legislation and the operational policy will develop will determine how efficient and less burdensome this proposal will be. It's still a work in progress.”This means there is still uncertainty on whether a foreign trading entity will be required to register for VAT for digital purchases you make on the Internet.But note – “Vat is payable where goods and services are consumed” so this is likely to be the trend in South Africa in alignment with the current global trends.
  5. Where applicable and especially in different geographical jurisdictions and for certain product offerings- you may need a business licence.
  6. Have you opened your business bank account?
  7. Is your online payment mechanism in operation: Credit Card ; Paypal/; Google Payments / Wallet are some of the outsourced options to accept payment through your online store. Note: security procedures are mandated by the Electronic Communications and Transactions Act 25 of 2002, which act applies to e- commerce transactions with consumers, meaning you and I and not with juristic entities.  A juristic purchaser will likely transact with an online company only if the payment mechanism is secure.
  8. You might want to choose a payment mechanism originating and based in a foreign country.
  9. Be knowledgeable of foreign countries requirements for the export of capital via the Internet.



    1. Be mindful that your consumers may be subject to their countries central bank rules and have to obtain approval for permissible online foreign currency purchases above certain thresholds.   
    2. In the same vein notification to consumers that they will need to comply with customs duties and requirements for importation of items purchased online is also recommended.
  10. Make sure your domain is registered and if you need a trademark – give this consideration.
  11. Get smart on product information and presentation of your products online – and choose to be accurate and professional in the content and layout.  Make sure you are not engaging in unauthorised reproduction from the internet to display your online products.  Here, the Consumer Protection Act 68 of 2008 ("CPA") and ECTA require you to provide sufficient description to your consumer to enable your consumer to make an informed decision.


 Some additional and necessary legal requirements:

  1. Get your Terms of Service drafted or reviewed by a lawyer and add in the appropriate legal disclaimers. This is the legal agreement between you and your online customers and sets out the legal engagement. Your online sale is a contract of sale!  ( Note the ECTA requires terms of agreement, for engagement with consumers)
  2.  Have you thought of a Returns Policy?  You will need to advise your online consumers what they can expect and how you intend to respond to returns/exchanges and refunds if any.  I would caution against a No Returns / Final Sale policy as the CPA has its own set of requirements.  In addition, the ECTA requires that you provide this information to your consumers.
  3.  Don’t forget about a Privacy Policy as consumer information is private and sensitive and subject to data privacy /protection legislation.  In light of the Protection of Personal Information Act 2013 (“POPI”) it is best to have guidelines in place and to advise your online consumers that their personal information will be not be not misused. It is important that such information “only be processed if given the purpose for which it is processed it is adequate, relevant, and not excessive (s 10). Get consent from your online data consumer as POPI requires consent and that the processing is necessary for conclusion or performance of a contract. Your online sale is a contract of sale!   A privacy policy is also an ECTA requirement where you engage with consumers and remember a consumer ito the ECTA is natural personal. Global trends have a marked and strong emphasis on Privacy Policies.
  4.  Website: make sure your website is in compliance with all applicable requiments including legal requirements of the ECTA which sets out mandatory information that need to be on your website ranging from legal status to address to pricing and description of product offering as well as manner of payment and delivery and other aspects.


This is a generic guide with specific references to South African law. Different company incorporation and payment jurisdictions require will compliance with their own laws.

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Creator Spaces   Designing Innovation Economics


Ayesha Dawood

I liked this when I came across it “Thinking is a kind of making, and making is a kind of thinking" says Jessie Shefrin former Provost of The Rhode Island School of Design and past Dean of Graduate Studies of The Rhode Island School of Design.

I like this too, alot 'design thinking ... is the expression of communication – the form itself...' that is the response I got when I asked John Maeda, at a talk at MIT this year what design thinking is -- Is it the form, is it the way it is presented .. and how does it impact international affairs? His response has got me mulling on innovation economics – and a very 21st century focus. The innovation economics idea was introduced to me by Professor William Fisher of Harvard Law School, Wilmer Hale Professor of Intellectual Property. And so Professor Fisher I take the liberty to propel this idea to designing innovation economics in the 21st century. So here I am positing Creator Spaces as innovation economics in action. And yes, Prof Fisher, Intellectual Property is important and as you say, only and only if it creatively engages with culture. So I take the creative engaging with the culture of a people, the culture of counties ... to a culture of creation. So, I am building and creating and designing too. Is this Ronald Dworkin`s chain novel theory playing itself out – a step by step building of things.

In particular I focus on Creator and Maker spaces which I call Creator Spaces. It is a movement rapidly gaining traction – and pioneering new pedagogies – tinkering, creator and playful learning pedagogies. No doubt this is influencing and will continue to improve a whole new wave – tinkering, playful learning and learning through play and exploration heralding novel creations as well as iterations in the new edu- tech era.

This is innovation economics birthed. A world of tinkering, software and hardware creation including an immersive engagement with technology and with materials –that is what empowers us to be courageous and creative. To make, to create – the art of playful learning and innovator spirit is boldly borne.

In seeing what we create – both online with immersive engaging of technology to building with our minds and hands to creating with materials to embracing the realm of possibilities and yes frameworks ( the lawyer in me screams legal frameworks as much computational thinking calls for system frameworks ). That is the power of Creator Space. They energise, motivate, uplift and propel growth in ones own sense of self, in creativity, in making, in building, in designing and cognition and critical thinking. And this is why it makes sense – it is innovation economics in both the digital and physical – a new form of a connected world – a world of immersive technology made simple – a world of creative making and a world of design and designing new things – software, new hardware, new things and while the search for new hardware forms and hardware materials is increasingly opening up new possibilities in materials.... Creator Spaces are about working with what is available as well making new from afresh and in that process new forms are birthed – New software creation is Creator Space and open source learning and remixing also lend impetus to this. See what amazing creations Scratch, an open source computer programme inspiring community learning and inspiring kids to create stories, animations and games - initiated at the MIT Media Lab Lifelong Kindergarden Group - is doing for kids globally here

Designing Creator Spaces is about inspiring people to take charge of their minds and ideas. I marvelled at watching the excitement and agility of the kids at MIT `s Scratch Day this May. Boundless enthusiasm and fun creations – and such confidence.

A new creator pedagogy in the making – yes – but maybe not so new in Africa and emerging economies where creator crafts and tinkering necessities were birthed. It is this staple that will take the shift to tinkering and artful play in emerging economies to levels unparalleled and a boon for innovation economics. Now that is design thinking innovation economics.  Creator Spaces is innovation economics. And yes, Intellectual Property matters.

Ayesha Dawood is a lawyer, writer and artist and educator. She is a Harvard and South African educated lawyer (@ConsultAyesha) She has an LL.M from Harvard Law School and is a recent Fellow of the Weatherhead Centre for International Affairs, Harvard University.