Legal and regulatory framework of e-commerce in Ghana


Before the internet, we could only trade face-to-face and through traditional forms of communication. Now, with the pervasive digital space and electronic payment systems, we can order our favourite skin care products or download music online from the comfort of our homes. We are living in a new reality – brick-and-mortar stores have essentially given way to a bustling world of electronic commerce!

The World Trade Organisation (WTO) defines electronic commerce (e-commerce) as the “production, distribution, marketing, sale or delivery of goods and services by electronic means”, which can be between enterprises, households, individuals, governments and other public or private organisations.[1] E-commerce is, thus, the use of the internet for marketing, identification, payment and delivery of goods and services.[2]

Compared to traditional face-to-face commerce, e-commerce is a faster and more convenient way of doing business. Businesses can easily access potential customers online, reach new markets, update prices and information on goods and services, and have unlimited digital shelf space to display their goods. With online stores on social media applications like Instagram, e-commerce serves as a level playing field for small and medium enterprises (SMEs) to compete with more prominent brands online.

We cannot overemphasise that transacting online comes with its attendant risks. There is no opportunity to physically examine goods, verify the item’s specifications or the supplier’s identity online. Consumers may also fall prey to illegitimate shopping websites, exposing them to fraud, hacking, or identity theft. These reasons call for a robust e-commerce regime and necessary protection to ensure that consumers are safe online.

As e-commerce is growing at a meteoric pace, it is crucial for business owners to know its legal aspects as they try to market or sell their products (whether goods or services) online. This article will attempt to consider the salient elements of e-commerce.

Scope of e-commerce

Under our laws, e-commerce covers all business transactions, including digital services, that occur through the electronic transmission of data over communications networks like the internet.[3] In addition to marketing and selling products online, the following digital services are considered e-commerce for tax purposes: online gaming, cloud services, video or audio streaming, digital marketplace operations, and online advertisement services.[4]

Modalities for an online contract of sale
Like any form of commerce, e-commerce, as a transactional activity, involves forming a contract. For a contract of sale, there must first be a valid contract satisfying the main conditions of capacity, offer and acceptance, intention to create legal relations and consideration (money paid for a product or service).

However, in e-commerce, a contract of sale formed online may appear more complex than in traditional commerce. A typical way an online contract is formed in e-commerce begins this way: the seller invites the buyer to make an offer (invitation to treat) through the promotion of the product on web pages or social media ads. These ads typically state the price and other conditions upon which an offer will be accepted. The buyer then makes an offer by expressing interest in buying or clicking a button to “add to cart”. The seller accepts the offer from the buyer by processing payment and shipping the product or making the service accessible.

Internet communication offers and acceptances mainly occur through exchanging emails, filling out website forms, or agreeing to terms of service on the website. A digital signature (any data intended to serve as a signature) may be used if a signature is required for an online transaction.[5] An automated transaction is valid even if an electronic agent was used at any point in its formation. The terms of an agreement bind the customer interacting with an electronic agent if he can access the terms before the formation of the contract.[6]  Any contract or transaction made online will be valid whether it was concluded partly or wholly through an electronic medium.

In terms of selling and buying goods, the primary legislation in Ghana, the Sale of Goods Act 1962, has comprehensive rules on modalities, including what constitutes a sale of goods contract, how ownership or risk in goods pass, the rights and obligations of parties, as well as remedies. However, this 60-year-old law was based on the English Sale of Goods Act of 1893. Thus, the law did not anticipate most technological trends and developments in commerce today.

Terms of Service Agreements

Terms of Service Agreements (also referred to as “Terms and Conditions” or “User Agreements” or “Terms of Use”) is a legal agreement on websites between a service provider (here, a business) and a visitor or customer that sets out rules which the customer must agree to before using the offered service. They are vital for e-commerce stores, even though they are not required.

The law requires electronic money issuers, payment service providers and anyone operating an electronic transaction platform to enter terms of service agreements with consumers.[7] Terms of Service Agreements help businesses limit their legal liability while maintaining control over their digital platform. If you are familiar with purchasing software applications or downloading mobile apps online, you might have come across a text box requiring you to agree to specific terms and conditions before using or purchasing the application. These terms have clauses on pertinent issues such as copyright, limitation of liability, payment, refunds and returns and the right to cancel a subscription or service. Since e-commerce sometimes has cross-border implications, some providers include a choice of law and jurisdiction clause that stipulates the country whose law will govern any dispute that may arise.

Disclosures and requirements under the Electronic Transactions Act

The Electronic Transactions Act 2008, the primary law governing online communications and transactions, requires electronic service providers to make specific disclosures. Under that Act, electronic transactions are defined as transactions through an electronic agent such as a computer programme or other automated means.[8] Since e-commerce qualifies as an electronic transaction; the Act will apply to businesses that market or sell goods and services online. This law will further apply to the supply of goods if the consumers are in Ghana.[9]

Business owners conducting business online must provide certain information to their customers. This information includes the full name and legal status of the business, physical address, phone and email contact, membership of any regulatory body, sufficient description of the main characteristics of products and services, the total price of products and services and manner of payment. The website must also provide the terms of agreement for a transaction, the privacy policy and how consumers can access a complete transaction record. The business owners must allow the customers to review, correct errors, and withdraw from a transaction before concluding the purchase. They should also use a payment system that is sufficiently secure in relation to accepted technological standards available at the time of the transaction.[10] One way of ensuring secure transactions is by using identity verification methods. These methods often use personal information like telephone numbers or postal addresses to check and verify the identity of shoppers using data from a range of sources, such as consumers’ banks. This method also protects consumers whose bank cards may be used by unauthorised third parties in transactions.

Under this law, all operators of electronic services must apply for a license to operate online.[11] The institution charged with this duty, the National Information Technology Agency (NITA), has yet to introduce this licensing regime.

Payment Systems and Services

An important aspect of e-commerce transactions is [electronic] payment. E-commerce can only thrive with a proper payment system regime. In 2019, parliament introduced the Payment Systems and Services Act 2019 (PSSA). This Act aims to consolidate and amend all laws relating to payment systems and services and to regulate institutions that engage in payment systems and electronic money business. The Bank of Ghana (BoG) has supervisory and regulatory authority in all matters relating to payment, clearing and settlement systems.[12]

Any institution already registered under the Banks and Specialised Deposit-Taking Institutions Act, 2016 (usually banks and other deposit-taking institutions) shall apply to the BoG for authorisation before engaging in a payment service business.[13] An institution that wants to engage in a payment system service not already registered under the Banks and Specialised Deposit-Taking Institutions Act, 2016, must apply for a license from the BoG[14]. The license or authorisation application must be in a prescribed form, and the licensed or authorised institution must pay for processing, license, and annual renewal fees.[15] Before the BoG issues a license to an institution to operate as a dedicated electronic money issuer, the institution must, among others, be a limited liability company and have at least 30% equity participation of a Ghanaian.[16] The BoG can suspend or revoke a license or authorisation under certain circumstances. There are review and appellate procedures an institution can invoke for being refused a license.[17]

A payment service provider with a license or authorisation has the power to provide, among others, the following services:

  1. Clearing of payment instructions among financial and non-financial institutions
  2. Settling obligations arising from the clearing of payment instructions
  3. Transfer of funds from one account to another using electronic means
  4. Facilitation of inter-operability of payment systems and services among payment system providers
  5. Provision of electronic payment systems for the unbanked and under-banked population, e.g., mobile money
  6. Issuing of electronic payment instruments
  7. Issuing of prepaid cards, credit cards, debit cards and similar medium

The law has provided safeguards for security in payment systems. A service provider shall have: an appropriate and tested technology system equipped with fraud and monitoring and detection tools; a valid third-party certification from a reputable certification authority; a system capable of interoperating with other payment systems in the country; and a cybersecurity policy when applicable.[18] A payment service provider must ensure that only the account holder authorises a transaction against an account of a customer. For instance, when operating a debit card or mobile money transaction, the provider (bank or telecommunication company) will send a prompt requiring you to enter your pin. The provider is also to use an appropriate authentication medium approved by the BoG. A customer subscribing to a payment service like mobile money, debit card, or FinTech app must submit a form of identification as a customer due diligence requirement. The forms of identification permitted are a national identification card, voter identification card, driver’s license, passport, national health insurance card, biometrics and any other identification prescribed by the BoG.[19]

Anytime there is a transaction, the service provider must notify the customer of the transaction through electronic notification or a physical receipt. The notice must at least state the transaction amount, transaction type, date and time of the transaction, unique transaction reference, identifying details of the recipient or sender and any fees changed.[20] A service provider shall implement a system with built-in control mechanisms for a complete audit trail. [21] They shall not engage in any activity likely to result in systemic risk; or affect the integrity, effectiveness, or security of the payment system.[22]

A service provider that is not a bank or specialised deposit-taking institution, should not engage in banking business or any activity prohibited by the BoG. Permissible transactions under the Act include domestic payments, domestic money transfers and cash-in and cash-out transactions, all captured in e-commerce. [23] The service provider should also only count airtime as electronic money or use airtime for permitted activities if it is expressed in monetary value.[24] If the service provider wants to outsource its technology platform, operational functions, and internal audit and risk management functions, it must inform the BoG.[25]

Consumer Protection

There has yet to be a comprehensive law or policy framework on consumer protection in Ghana. However, the Electronic Transactions Act and Payment Systems and Services Act have stipulated consumer protection provisions for transactions made over the internet.

In the Electronic  Transactions Act, providers must supply consumers with certain information before enrolling in a program or a service on their platform. Businesses that send commercial electronic transmissions to consumers shall provide the consumers with (a) the option to cancel the subscription to the mailing list (through opt-in and opt-out options) and (b) the identifying particulars of the source from which that person obtained the consumer’s personal information. A provider shall not send unsolicited electronic communications to a consumer without obtaining prior consent unless it is sent to a consumer concerning a service. The consumer is entitled to recover the costs of cancelling the unsolicited communication. An agreement will not be concluded if a consumer fails to respond to an unsolicited communication.

The supplier is liable for any damage the consumer may suffer from failure to use a secure payment system. Unless the parties to the online transaction have stipulated specific rules, a supplier must execute an order within 14 days of receiving the order. If the supplier fails to perform due to the unavailability of the goods, he must immediately inform the consumer. The consumer can affirm or cancel the transaction if the suppliers fail to perform within 14 days or the agreed date.[26] The law allows the consumer the power to cancel a transaction within a grace period.[27] And lastly, any provision in an agreement online between a business and a consumer which does not consider consumer protection will be considered void.[28]

The Payment Systems and Services Act has also outlined these specific consumer protection provisions. The electronic money issuer or payment service provider must do the following:

  1. Observe universal principles on consumer protection, including equitable, honest and fair treatment of all customers; transparency and disclosure of benefits, risks and terms of any product or service offered in an accessible form; protection of customers’ data and privacy; and adequate systems for complaints handling and redress.
  2. Ensure high-quality performance of at least 99.5% service availability and accessibility. Within 24 hours of disruption or anticipated disruption, the service provider must inform the users through a short messaging form.[29]
  3. Explain product material and general product elements to a prospective client and ensure that the prospective client understands the nature and form of the product terms and conditions, features, and specifications.
  4. Ensure marketing follows the general principles of honesty and transparency
  5. Provide users with details of customer service points and agents, as well as the description of products and services of the service provider with applicable charges.
  6. Display all fees and service charges at all their offices and premises of agents
  7. Announce change of fees and service charges to its customers at least seven days before such change
  8. Give the user an electronic notification of charges or fees with an option to cancel a transaction before its authorisation.
  9. Allocate a unique identification number to their agent conspicuously displayed at the agent’s location.
  10. The law also requires service providers to establish effective complaint procedures and redress for users who may be aggrieved.[30]

These rules, though commendable, are inadequate in protecting consumers engaged in e-commerce. We must develop a good consumer protection law that will consider pertinent consumer issues that have been relatively abandoned, like fair advertising and marketing practices, online auction sales, and confirmation processes of transactions online.

Advertising and marketing rules

There is no overarching legal framework for advertisement in Ghana, but there has been an Advertising Council Bill in parliament since 2016. For many years, the Advertising Association of Ghana (AAG) and other civil society organisations have called for parliament to pass the Advertising Council Bill. The Bill, if passed into law, will establish an Advertising Council as an official public institution to regulate advertising, register advertising practitioners and license advertising companies. According to the Bill, every advert must be submitted to the Advertising Standards Committee for vetting and approval before publication. The Bill also has a Code of Professional Conduct and Ethics in its first schedule that sets out the principles that advertising practitioners must observe in executing their duties.

The Food and Drugs Authority (FDA) issued guidelines for food advertisement in February 2016. These guidelines apply to all food advertisements, primarily to ensure that advertisements are carried out responsibly. Advertisement in the guidelines has been defined as a “public notice, either by print or electronic media, offering or promoting the sale of a food product.[31] These guidelines, thus, anticipate advertisement through electronic media for e-commerce purposes.

The law also prohibits online advertisements relating to fortune-telling, palmistry, astrology, or other subtle craft (charlatanic advertisements).[32] In competing with other business service providers, businesses should observe fair marketing practices. They are to omit misleading information and ensure their commercial activities are consistent with honest practices. They should not make false statements that may disparage the products or goodwill of other business owners.[33] Engaging in unfair or deceptive trade practices online can open businesses to potential lawsuits and reputational damage.

Intellectual property

Intellectual property (IP), which encompasses the creations of the human mind, is a vital aspect of e-commerce. Businesses must protect their IP and ensure they do not infringe on the rights of others. The two main types of IP pertinent to e-commerce are copyright and trademark.

With copyright, businesses have an exclusive right to produce, publish or perform any original literary, artistic, or audiovisual work. This right ordinarily applies to images or other published materials on their websites or social media. Copyright also protects the software that forms the basis of online platforms. Copyright in Ghana lasts for 70 years for corporations, whilst for individuals, it lasts for life and 70 years after demise.[34] As an owner or operator of an e-commerce platform, you must register your copyright and include copyright notices on your platform. The business can declare its copyrights in the terms of service agreements. A potential means of protection is using a digital watermark (digital code embedded undetectably in a digital image or audio file) on any material posted on the platform. More importantly, one must always obtain permission from the copyright holder of an image, audiovisual, sound, or any publication before using it on an e-commerce platform.

The registration of trademarks protects, among others, distinctive names, logos, and the appearance of goods and services. This protection lasts for ten years from the date of application.[35] Protecting these aspects of one’s business is vital because they all contribute to a business’ brand image. Just like copyrights, the business can declare its trademark rights in its terms of service agreements. Operators of e-commerce platforms must not make any false trade descriptions that might infringe on the trademark of other businesses.[36] It is also crucial that website designers or owners not use any trademarked logo, name, or other identifying marks without the owner’s permission.

Data protection

The 1992 Constitution of Ghana guarantees the right to privacy as a fundamental human right.[37] Ghana is one of the few countries in Africa that has enacted comprehensive legislation on data protection and privacy. This legislation, known as the Data Protection Act 2012, has been in force for a decade.

As the digital marketplace grows, numerous consumers’ data is processed and kept across servers and various e-commerce websites. Institutions or businesses that process consumers’ data (data controllers) must ensure that data is processed lawfully and reasonably without infringing on the consumers’ rights.[38] A data controller cannot process a consumer’s data without consent. Nevertheless, the law allows exceptions where the purpose for processing the data is authorised by law, to protect the customer’s legitimate interest, necessary for a contract the customer is a party or to pursue the legitimate interest of a data controller.[39] Unless the law permits, a consumer in an e-commerce transaction can object to the processing of his data.[40] A data controller who processes data of foreign consumers from a foreign country must ensure that the data processing complies with the data protection rules in that country.[41]

The law requires data controllers to register with the Data Protection Commission. The Commission grants a certificate of registration after registration, and this certificate is renewed every two years. A data controller may apply for the license through the Data Protection website. Depending on whether the applicant is a small, medium, or large data processor, there are prescribed fees the data controller must pay upon registration. A business owner transacting online may use the following tips to protect the data and privacy of their consumers on their websites:

  1. Use data collected for improved customer service.
  2. Do not provide customer data to third parties without the customer’s permission.
  3. Clearly describe and explain what data is collected and how it is used
  4. Give customers the right to have any of their data deleted
  5. Train employees on how to keep data secure[42]

There is still much work to be done to increase data protection awareness and registration in the country.


Regular businesses registered in Ghana must comply with multiple tax laws depending on their operations. These taxes could range from corporate, transfer, excise, sales, and property taxes to value-added taxes. Foreign businesses that transact remotely in Ghana may create a permanent establishment through an independent agent in Ghana, depending on the circumstances of business operations. Once the Ghana Revenue Authority (GRA) deems such a permanent establishment created, the business will have the same traditional tax obligations as if registered in Ghana.[43] If the foreign business does not have a permanent establishment in the country, it must still pay VAT under the law.  Since April 2022, the Government of Ghana has imposed a VAT rate of 18.5% on foreign digital services platforms like Netflix, Amazon, Alibaba, and gaming sites that offer digital services for use and enjoyment in Ghana.[44]


As the arena of the digital space broadens, online transactions are becoming the preferred means of commerce. With the introduction of proper legislation on payment systems framework in Ghana to support online transactions, we are on the path to reaping the immense benefits of e-commerce. Even though Ghana faces many technical, financial, and regulatory barriers to the realisation of a buoyant e-commerce industry, the industry still presents a treasure trove of opportunities for economic growth. To ensure a strong e-commerce industry, we need to enhance its legal and policy framework for maximum returns. This move will also strengthen our consumer protection regime to countervail consumers’ risks when transacting online.


The author is a lawyer and an academic. She can be reached at [email protected].

[1] World Trade Organization,, Last accessed on October 30, 2022

[2] Ayo, C.K., Adewoye, J.O. and Oni, A.A. (2011) Business-to-Consumer e-Commerce in Nigeria: Prospects and Challenges. African Journal of Business Management, 5, 5109-5117.

[3] Section 16(3) (b) of Value Added (Amendment) 2022 (Act 1082)

[4] Section 16(3) (a) of the Value Added Tax (Amendment) 2022 (Act 1082)

[5] Section 10 of Electronic Transactions Act, 2008 (ETA)

[6] Section 17 of ETA

[7] Section 45 of PSSA

[8] Section 144 of the ETA

[9] Section 53 of ETA

[10] Sections 46 to 50 of ETA

[11] Section 38 of ETA

[12] Section 3(1) of PSSA

[13] Section 10(1) of PSSA

[14] Section 7(!) of PSSA

[15] Section 19 of PSSA

[16] Section 23 of PSSA

[17] Section 28 of PSSA

[18] Section 20 of PSSA

[19] Section 35(1) of PSSA

[20] Section 20 of PSSA

[21] Section 34 of PSSA

[22] Section 34 of PSSA

[23] Section 23 of PSSA

[24] Section 23 of PSSA

[25] Section 38 of PSSA

[26] Section 48 of ETA

[27] Section 49 of ETA

[28] Section 54 of ETA

[29] Section 45 of PPSA

[30] Section 44-47 of PSSA

[31] Food and Drugs Authority, Guidelines for the Advertisement of Food, 2016

[32] Section 110 of ETA

[33] Sections 1-4 of Protection Against Unfair Competition Act, 2000 (Act 589)

[34] Section 12 &13 of Copyright Act, 2005 (Act 690)

[35] Section 10 of Trademark Act, 2004 (Act 664)

[36] Section 23 of Trademark Act, 2004 (Act 664)

[37] Article 18 of the 1992 Constitution of Ghana

[38] Section 18(1) of the Data Protection Act, 2012

[39] Section 20(1) of the Data Protection Act, 2012

[40] Section 20(2) of the Data Protection Act, 2012

[41] Section 41 of the Data Protection Act, 2012

[42] Schneider, G. (2016). Electronic Commerce (11th Edition) Cengage Learning EMEA

[43] Section 107 of the Income Tax Act, 2015 (Act 896)

[44] Section 16 of Value Added Tax (Amendment) Act, 2022 (Act 1082)

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