The laws of contract are governed by common law cases. E-commerce relates to the making of contracts are made through electronic communications. The messages are exchange electronically over the Internet or other point-to-point terminals such as ATM machines, hand-held devices such as EPS terminates. Where transactions are made, it has to go through 2 basic processes: first is the entering into a valid and enforceable contract; second is making payment. Despite the widespread use of Internet and adoption of telecommunication devices such as phone terminals (either fixed line desktop telephones or cell phones), these 2 processes are not always done in a “straight-through” manner mature E-commerce web-sites may have the 2 processed combined so that an online customer may agree to a purchase of a certain stock e.g. a bank or CD and at the same time pays through the credit card payment gateway. Some goods such as a digital photo or software can be delivered online though downloading but most require physical delivery e.g. a book or a CD.
Merchants and a buyer must ensure that an online transaction must be valid and enforceable so that merchants buyers cannot easily deny the contract's existence. Buyers get the goods order and sellers get pay.