- Start with the asset list, not the price
- Check the intellectual property actually transfers
- Confirm the software and accounts can come with the business
- Move the domain name through the registrar
- Include the social pages and handle the customer data
- Plan for employees, GST and the registrations
- How an Artificer Legal lawyer can help you buy the business
- The assets that do not move by themselves
You have found an online business for sale: an e-commerce store, a content site with a steady readership, or a drop-shipping operation with a customer list. The asking price may look modest next to buying a shopfront business, but an online business is almost entirely intangible. A domain name, a brand, software, customer data and social media pages are what you are actually paying for, and none of those things moves to you automatically when you sign the contract. Working out which assets exist, who owns them and how each one legally changes hands is the real work of the purchase.
Start with the asset list, not the price
A business valuer, usually an accountant or business broker, can tell you what the business is worth. What a lawyer adds is the structure: a written list of exactly what you are buying and a contract that actually transfers it. For an online business that list typically covers:
- Trade marks and copyright content: the brand, the website, and any blogs, videos, manuals or other creative works
- The domain name: the main domain and any related domains the business uses
- Software and platform accounts: the website platform, payment gateway, email service and app store accounts
- The customer database: the list of people the business markets to and sells to
- Stock and goodwill: physical inventory, if any, and the value of the established reputation
You also need to decide whether you are buying the assets of the business or the shares of the company that runs it, because that changes which liabilities, contracts and employees come with the deal. Ask the vendor for a full inventory of accounts, logins, providers and intellectual property before you commit to a price.
Check the intellectual property actually transfers
A registered trade mark for the brand can be assigned to you, but the assignment must be documented and the change recorded with IP Australia under ss 106 and 110 of the Trade Marks Act 1995 (Cth). The Trade Marks Regulations 1995 require a document establishing your title as the assignee to support the application, so a signed assignment needs to exist before the change is recorded.
Copyright in the website copy, blogs, videos, manuals and design works is the other major asset. An assignment of copyright has no effect unless it is in writing and signed by or on behalf of the assignor: s 196(3) of the Copyright Act 1968 (Cth). If freelancers or contractors built the site or created the content, check that they assigned their rights to the vendor in writing. Otherwise you can pay for a website you do not have the right to use.
Confirm the software and accounts can come with the business
If the business runs on software the vendor built, the vendor needs to own it outright, which means the developers assigned their rights, and needs to be able to assign it to you. If the software is licensed, such as a software-as-a-service subscription, check the licence terms carefully. Many licences are personal to the licensee and cannot be assigned without the provider's consent.
The same applies to the platform accounts the business depends on. E-commerce platforms, payment gateways, email services and app store accounts are often registered in the vendor's name and tied to their identity, so the practical transfer can be more complicated than the legal one. The sale agreement should include a warranty from the vendor that they are entitled to assign or licence all of the software to you.
Move the domain name through the registrar
.au domain names are administered by auDA, but you do not buy a domain name, you hold a licence to use it, and the licence does not pass automatically when you buy the business. A change of registrant is arranged through the domain name provider, the registrar of record, under the .au Licensing Rules. Both you and the vendor must meet the eligibility requirements, including the Australian presence requirement for a .com.au licence.
auDA's guidance on transferring a domain name is worth reading before you negotiate: if the domain is being transferred as part of a business sale, the transfer must happen within 28 days of entering the contract unless the agreement says otherwise. Put the transfer in the contract and get it done promptly, because the domain is often the most valuable single asset the business owns.
Include the social pages and handle the customer data
Social media pages and handles can add real value, and a transferred following is worth more than starting from zero. But ownership of a Facebook page, LinkedIn company page or X account is governed by the platform's terms of service, not by your sale agreement. Confirm the pages can be transferred to you, for example through a platform's business manager or handover process, and that the vendor will cooperate with the transfer.
The customer database needs separate attention. A customer list containing personal information brings the Privacy Act 1988 (Cth) into play. The Office of the Australian Information Commissioner treats the sale of a customer database as trading in personal information, which means the Privacy Act applies even where the business would otherwise be an exempt small business. As the buyer, the Australian Privacy Principles govern how you collect, use and disclose that data, so ask for de-identified or aggregated customer information during due diligence and make sure the sale agreement covers your right to use the database for the business's existing purposes.
Plan for employees, GST and the registrations
If the business has employees and you take them on doing the same work, and the assets pass under an arrangement between you and the vendor, there can be a transfer of business under s 311 of the Fair Work Act 2009 (Cth). The practical effect is that the employees' existing agreements and accrued entitlements can carry across to you rather than starting from a clean slate, so factor the true cost of the workforce into your price.
On the tax side, if the vendor supplies you with everything needed to continue operating the enterprise, you agree in writing that the supply is of a going concern, and you are registered or required to be registered for GST, the supply can be GST-free under s 38-325 of the A New Tax System (Goods and Services Tax) Act 1999 (Cth). Get the written going concern agreement in place before settlement.
The registrations also need a plan. An ABN belongs to the vendor and cannot be transferred, so they cancel theirs and you register your own. A registered business name also needs to be transferred into your name as part of the sale. And because online businesses often use financed equipment, a $2 search of the Personal Property Securities Register will show whether any of the assets you are buying are subject to a security interest that could put your ownership at risk.
How an Artificer Legal lawyer can help you buy the business
None of these steps is a form-filling exercise, and a lawyer's role is to make sure the bundle of intangibles actually moves. An Artificer Legal commercial lawyer can help you identify the assets, draft and negotiate the sale agreement and the asset schedule, prepare the trade mark and copyright assignment documents, review the software licences and platform arrangements, advise on the Fair Work and GST consequences of the deal, and run the privacy and PPSR checks so you know what you are taking on before you sign.
The assets that do not move by themselves
The point that costs buyers the most is this: nothing in an online business transfers automatically. The domain licence stays with the vendor until the registrar processes a change of registrant, copyright does not pass without a signed written assignment, the customer database is regulated by the Privacy Act, and software licences may not be assignable at all. If you sign before those transfers are arranged and documented, you can pay full price for a business you cannot actually operate.
In short, get the business valued by an accountant or broker, then have a lawyer build the asset list, verify the intellectual property, arrange the domain transfer within 28 days, check the licence terms, plan for employees, GST and the registrations, and get the whole deal documented in the sale agreement before you commit.