tl;dr – You’re putting yourself at risk if your website does not have a good Privacy Policy and Terms of Service.

For many website owners, terms of service and privacy policies are the last thing on their minds. Does anyone even read them?

Well, the FTC (Federal Trade Commission) does, and you should, too. Experienced affiliates not only have terms of service and privacy policies, they have good terms and polices. Having accurate terms of service and privacy policies reduces your risk, increases your credibility, and protects your business.

Privacy Policies

A privacy policy describes how your website collects, uses, and discloses user information. Smart website users are cautious to enter their personal information into a website without first reviewing its privacy policy. Apart from the practical reasons to have a privacy policy, failing to have a privacy policy, or having an inaccurate privacy policy, can subject the website owner to substantial legal risk.

There is a high probability you are already required to have a privacy policy. For example, states like California require all website owners that collect information from California residents to post detailed privacy policies. Federal law requires privacy policies for certain regulated industries and for websites collecting information from children. Advertisers may also require you to have a privacy policy. For example, Google AdSense requires participating websites to post a privacy policy disclosing certain information.

However, do not think that copying a privacy policy from another website will cover you. Posting a privacy policy that does not reflect your data collection and use practices can give rise to a complaint by the FTC. The FTC has repeatedly brought suits against companies that don’t live up to their privacy policies, especially following data breaches.

Terms of Service

Terms of service lay the ground rules governing the use of your website. The interaction between a user and a website is a business transaction, even if no money changes hands. By clearly posting terms of service, you can protect yourself against a variety of risks.

Terms of service let the user know how they can and can’t use your website. For example, terms of service should contain rules and restrictions on user-generated content in order to limit your liability for users’ copyright infringement.

Tip: Are you registered under the Digital Millennium Copyright Act?

Terms of service can also contain the full details for any disclosures, disclaimers, or refund or other policies. However, important disclaimers should not be contained solely in your terms of service.

Finally, terms of service can provide you certain advantages in the event you get into a dispute with a user, including limits on your liability and where a lawsuit must be brought.

In summary, failing to draft and post a privacy policy and comprehensive terms of service lessens your website’s credibility, places you at risk of noncompliance, and fails to protect your business.

Posting an inaccurate privacy policy or terms of service can create additional risk. Drafting and reviewing these documents now can substantially benefit your website down the line.

Patrick Cooper is an internet law attorney at Fraser Stryker PC, LLO in Omaha, Nebraska.

This article appeared in issue 26 of FeedFront Magazine, which was published in April 2014. http://issuu.com/affiliatesummit/docs/feedfront-26

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