Your Ultimate Guide to eCommerce Compliance in 2025

For people who are fairly new to the eCommerce world, eCommerce compliance may seem like a daunting task. Many choose to ignore it, believing that the compliance aspects are too costly or confusing to handle.

Others mistakenly assume that using common marketplace platforms, such as those from Shopify or Amazon, automatically ensures compliance. In fact, it is not always the case, and at times even leads to serious repercussions.

Advanced economies are the ones with the greatest calling for eCommerce compliance. In the United States, there is a revision for data privacy laws, with 5 states calling for enforcing new GDPR-inspired status in 2023 and more to follow. We are also seeing global data protection authorities, such as France’s National Commission of Informatics and Liberty (CNIL), adopting new rules for GDPR enforcement for cross-border businesses.

While laws may differ in different countries, the message is clear: eCommerce compliance is going to be as relevant as ever. It also establishes the rationale of our article to educate and inform you of the latest themes that are happening in this area.

What is eCommerce Compliance?

eCommerce compliance can be a boring term but is increasingly relevant to those who actively participate in the field or those who are looking to expand to different markets.

 

eCommerce compliance ensures that all aspects, from consumer data, financial transactions, and all the handling of the orders, are dealt with in an ethically, securely, and compliant way. It also serves to deal with problems that arise from this emerging field, including data leaks, fraud, regulatory violations, and customer dissatisfaction.

It also differs by country, with the advanced countries such as the U.S. and Europe having more sophisticated regulations than the others.

Consumer sentiment towards compliance also points to the stricter side. According to the 2022 PwC report, they pointed out that 71% would not buy from a company they do not trust; and a whopping 73% would not recommend an eCommerce site to their network if they feel that there is a lack of security measures.

eCommerce compliance reflects trust, as the PwC report suggests. Without security protocols in place, consumers, especially eCommerce consumers, may feel that they are less protected when purchasing on the website. Especially as many sensitive customer data are handled day by day, it calls for a stronger adherence to eCommerce compliance.

Reasons for Compliance in eCommerce

The reason for compliance < The cost of non-compliance. Many believe that compliance is a cost issue and thereby ignore it. However, the problem is not when compliance incurs extra costs to your eCommerce business. Instead, it is when non-compliance leads to additional issues for the eCommerce business.

At the financial level

Non-compliance may lead to significant financial losses. According to an article by Sumsub, the eCommerce industry has witnessed a rise in fraudulent activities, prompting the need for AML compliance in the industry. It is even estimated that the numbers are as high as USD $41 billion in 2022, and is projected to even rise to $487 billion by 2023.

Other potential issues may include legal penalties, fines, and operational disruptions that derive from violating the compliance issues.

It explains why a lot of eCommerce players will choose logistics providers that highly emphasize compliance. But this is not necessarily the full picture.

At the reputational level

The problems of non-compliance extend to the reputational level, where it leads to legal penalties, negative media, and a tarnished reputation. In the past, you can see a rising publicity of eCommerce companies that have data issues.

Facebook data privacy scandal can be an example: Although not related to eCommerce directly, their improper sharing of user information to Cambridge Analytica, a data analytics firm by the Trump Campaign, has led them nowhere but a serious lawsuit and a monetary payment of $725 million to settle this issue.

On the contrary, having compliance embedded in your eCommerce operations can help nurture customer trust and legal protection. It means that customers can feel relieved that their data and information are protected when using your platform.

At the growth level

Compliance is a continuous process. It requires improvement from time to time, a rapid iteration depending on the growth stages. As you grow in scale, you may also find yourself working with more and more stakeholders. This includes the transitioning from first- to third-party data, or the use of third-party logistics providers to handle your customer’s data

This leads to our point that compliance should be dealt with as early as possible. Or else it may turn out as a roadblock for your eCommerce business as you grow.

Key Data Protection Regulations for eCommerce

Depending on the country and region that your eCommerce business operates in, or if you are now involved in cross-border eCommerce, various compliance laws may apply. However, the underlying principle for all eCommerce compliance laws remains the same: Protect consumer data.

From the United States, Europe, and Asia, we will explore some of the compliance laws that are the most connected by eCommerce companies: 

General Data Protection Regulation (GDPR)

A familiar term to many. The General Data Protection Regulation (GDPR) is the cornerstone of data protection laws in the European Union (EU). Similarly, the United States and many global countries are following suit.

The GDPR establishes strict guidelines for the collection and processing of personal information of individuals within the business. The key requirements are:

• The need for consent: Explicit (or at times implicit) consent.
• The need for transparency: Clear information about how the data will be used, stored or shared.
• Data subject rights: Rights to access, rectify, or delete their data.
• Data breach notification: Obligation to notify authorities and affected individuals within 72 hours of any data breach event.

The implications of GDPR for eCommerce business is huge. In Europe, this law is likely strictly enforced for businesses, even for those with cross-border elements.

Besides, the article by Reuters also reflects the continuous development of GDPR regulations. In the past, data privacy laws were rooted in the “harms-prevention-based” principle but recently broadened to a “rights-based” principle, giving more robust rights for individuals and consumers to have legal control over their personal data.

After this reform, five of the U.S. states, led by California, started enforcing new GDPR-inspired statuses in 2023, with more states expected to follow suit.

ISO 27001

On the other hand, achieving ISO 27001 compliance is one that many eCommerce businesses want to achieve. There are a set of benefits of achieving this status, as this certification offers enhanced information security with a robust framework and signals well to customers that you are taking the issue of data privacy and security seriously.

In a crowded eCommerce marketplace, being ISO 27001 certified may also effectively set your business apart.

The process of achieving ISO 27001 compliance for eCommerce business is no easy feat and requires a structured and systematic approach. At the beginning, a gap analysis is necessary and you will need to define the scope and objectives of your ISO 27001 efforts. You should be building your ISMS with the following principles:

• Top management involvement
• Risk management
• Continuous monitoring and review of your ISMS
• Employee awareness and training
• Documentation of all related policies, procedures, and processes

There are also a few other areas listed as key considerations, including payment security, app security, and third-party vendor management.

Systems and Organization Controls 2 (SOC 2)

If you are operating your business in the U.S., then SOC 2 is likely familiar to you. The SOC 2 security framework covers how companies should handle customer data that is stored in the cloud and is an increasingly relevant piece to the SaaS model.

The key highlight of SOC 2 is the commitment to regular audits that evaluate the effectiveness of security controls and processes in place to protect sensitive information, hence fostering trust with customers.

However, at this stage, SOC 2 is still not a legal requirement and does not gain as much traction as regulations and standards like GDPR and ISO 27001.

Country-Specific Laws

In addition to GDPR, ISO 27001, and SOC 2, other country-specific or region-specific laws are of great importance. Here is a brief list of it:

United States

• California Consumer Privacy Act (CCPA)
• Children’s Online Privacy Protection Act (COPPA): Protects children under 13.
• Health Insurance Portability and Accountability Act (HIPAA)
• Gramm-Leach-Bliley Act (GLBA)

Europe

• ePrivacy Directive: Privacy in e-communications, regulations on how cookies and direct marketing are handled.
• Consumer Rights Directive: Ensures consumer protection in e-transactions.

Asia

• Personal Data Protection Act (PDPA): Applicable to Singapore, Malaysia, etc.
• China’s Cybersecurity Law
• Japan’s Act on the Protection of Personal Information (APPI)
• Australia’s Privacy Act

Other notable laws

• Personal Information Protection and Electronic Documents Act (PIPEDA)

Given the nature of your business and the countries covered, you will need to be more aware of the types of laws and compliance issues that can apply to your business. Cross-border businesses will also need to be extra careful of the potential compliance issues that may touch on it, whether you are aware or not.

Compliance in eCommerce Marketplaces

Both Shopify and Amazon have established compliance policies that adhere to ISO standards and GDPR. It is widely expected in marketplaces.

Shopify complies with GDPR and ISO 27001, ensuring a secure platform for merchants and customers. Shopify provides features that help customers to access and delete their personal data. However, the effectiveness of these tools can vary based on how individual merchants configure their stores. Similarly, Amazon adheres to ISO 27001 and has developed a robust GDPR framework that gives customers control over their personal data, promoting transparency around data usage and privacy settings.

However, as mentioned, their compliance practices are not perfect. Especially for Shopify, if third-party tools are connected, they may be exposed to data and security risks as customer data is also disclosed to third parties.

We Are Striving to be Compliant

As we expand our reach to a global audience, TrackingMore stands out as the market-leading order tracking solution designed with strong compliance in mind. 

Our commitment to data security is reflected in our adherence to ISO 27001 standards, offering assurance to both enterprises and emerging businesses in handling customer and tracking data securely. We are also proactively working towards enhancing our practices to align with GDPR requirements, ensuring that we remain at the forefront of data protection.

Moreover, our strict adherence to various data security regulations means that we implement robust encryptions across multiple dimensions of data handling. We also support the signing of customer data processing agreements.

The compliance of our tracking API is crucial. Many of our clients appreciate the extra security that comes with our approach to compliance, but also the access to real-time data from 1,300+ carriers and 80+ carriers.

In the following, we will explore two case studies, AliExpress and DHGate, and showcase how TrackingMore is able to solve their compliance-specific challenges.

Case study: AliExpress

AliExpress, a leading global eCommerce marketplace, faced significant compliance challenges with its logistics operations. The pandemic has increased demand for online shopping, and the need for an all-encompassing but compliant order tracking partner is imminent. During that time, long shipping times were a major concern for merchants and customers, prompting AliExpress to digitize its logistics process to enhance compliance.

To address these needs, AliExpress sought a tracking solution that prioritized data security and operational integrity. The compliance needs include:

• Flexible system to track high volumes of parcels during peak sales
• Tracking information encryption
• Custom API endpoint to address data security concerns

With this collaboration, AliExpress has been able to improve shipment tracking and compliance capabilities, and greater capacity to deal with peak sales. Eventually, they became a continuous partner of TrackingMore since then.

Case Study: DHGate

DHgate, a major cross-border B2B eCommerce platform, also faced security challenges due to persistent seller scams that threatened buyers’ trust and regulatory adherence. To enhance its shipment data accuracy and protection, DHgate partnered with TrackingMore for a more robust tracking solution with data compliance in mind.

Strategically, DHgate is able to achieve its key compliance needs while leading to benefits such as a 51% reduction in WISMO calls and 4x cost savings.

Embracing Compliance: A Path Forward

By reading this article, you should now have a deeper understanding of the important aspects of eCommerce compliance. Overall, we anticipate that GDPR and ISO 27001 will continue to be central topics in this field, while other country-specific or region-specific laws will gain more and more attention over time.

This article is not a brag about the fact that we have X, Y, and Z in eCommerce compliance but a means to highlight the growing importance of this issue.

As the need for compliance increases, we foresee that you may need an order tracking solution that is compliant in nature to deal with your increasing tracking needs in the future. That’s when TrackingMore can make a difference.