This paper scrutinises the legal protection of consumer rights in on-line contracts through the application of Khiyar al-‘Aib (option of defect). Khiyar al-‘Aib is a legal Islamic mechanism by which, one party, both parties or even a third party can nullify a contract, electronically or conventionally. Khiyar (option) means the authority to nullify a contract and Aib means defect. In fact, it is a right given to the purchaser to cancel the contract if he discovers that the object acquired has defect that diminishes its value. In on-line contracts, the consumer has no direct contact with the merchant and cannot easily verify the quality of the goods, thus creating a situation in which contracting parties are not at equal bargaining strength. Therefore, application of Khiyar al-‘Aib (option of defect) would be helpful in protecting consumer rights in the virtual world. This paper explores the Islamic principles by taking Iranian laws as well as the European law as a point of reference.
