"There seems to be a belief that the Internet is lawless, or that you don't need to worry about conventional legal principles when getting onto the Internet," Cameron McCullough, partner, Deacons Graham & James, said at the Chamber's March 6 luncheon entitled, "Legal Issues on E-Commerce."

But even before companies actually get on the Net, there are a number of legal issues which businesses must consider, he said. These include intellectual protection issues, from the design and protection of your site's contents to seemingly trivial issues such as linking to other sites.

"Simply because you are venturing into e-commerce, don't assume that you can then abandon the restraints and considerations that you would normally make in conducting a prudent business decision," Mr McCullough said.

The Electronic Ordinance has helped in facilitating electronic transactions. By equating electronic records with paper records, it gives transactions over the Internet the same standing as if they were paper records.

In short, laws applied to commerce, which have developed over the last couple of centuries, still apply to electronic commerce, he said.

Likewise, the Internet hasn't changed the essentials of creating a contract: you still need an offer and an acceptance; you still have to exhibit an acceptance to be legally bound; and there still has to be valid consideration.

The Internet also raises the question of jurisdiction laws. In the global supermarket, there may be products you are not allowed to drop into your shopping basket, or sell in certain areas.

Until recently, for example, Netscape used to offer two levels of encryption for users downloading its browser, because U.S. law prohibited the use of 128-bit encryption.

"The important issue here is that in constructing your Web site you want to make sure you are not making an offer that is immediately acceptable," Mr McCullough explained. "What you want to be doing is basically advertising your products and wares on the Internet as an 'invitation to treat.' You then receive an offer from a customer which you can accept or reject."

Doing business in a virtual world doesn't exclude businesses from the laws of the real world -- no matter how remote you think you are -- as a recent decision of a court in New York proved.

The attorney general there brought an action against the owner of a Web site located in Antigua. The owner was not a U.S. citizen. He wasn't a U.S. resident. The server and all assets were outside the U.S. However, because FBI agents were able to place bets on the Web site from New York, the attorney general used legislation, which prohibits the use of telephone lines across borders or internationally for the purpose of wagering, to prosecute the owner, Mr McCullough said.