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Ever wondered about running a website on the dark net? This article helps you do so safely and lawfully.

Imagine peeling back the layers of an onion to reveal a hidden, parallel web where privacy reigns supreme and anonymity is all but guaranteed. This is the world of Onion services on the Tor network, accessible only via the Tor browser and recognisable by their mysterious-looking “.onion” web addresses.

But before we get carried away with the allure of ultimate online privacy, let’s clear the air: Onion services can’t guarantee complete anonymity or immunity from cyber threats. The dark net is no lawless frontier, either; setting up shop here means following a set of regulatory rules, just as you would on the public internet.

Here’s a practical guide to what Onion services entail, the legal landscape for operating within Tor’s onion space, and some of the compliance considerations that come with creating a hidden service.

A quick primer for newcomers

Clear net versus dark net

The clear net is the visible, public part of the internet, accessible through standard browsers and indexed by search engines, where sites follow regular regulations and tracking is common.

The dark net, in contrast, is a hidden, unindexed segment accessible only via specialised software like the Tor browser. It emphasises user anonymity, appealing to those needing privacy (like journalists or activists) but also attracting some illicit activities.

While both parts of the internet serve different purposes, the dark net offers a unique environment with more privacy but less regulatory oversight.

Tor and Onion services

Let’s demystify what Tor and Onion services are.

  • Tor (short for The Onion Router) is a privacy-focused network that routes user traffic through multiple relay points, making it difficult (but not impossible) to trace back to a specific person.
  • An Onion service is a website that operates within this network, accessible only via a Tor browser and distinguished by its unusual “.onion” address. For example, Facebook offers a privacy-enhanced version of its site via Tor at https://www.facebookwkhpilnemxj7asaniu7vnjjbiltxjqhye3mhbshg7kx5tfyd.onion/ (you can only access the link via Tor browser).

The promise of Onion services lies in the privacy they offer, but the allure of invisibility can be misleading. Despite being designed for anonymity, onion services are still susceptible to cyberattacks, and no privacy guarantee is absolute. Even users with the best security measures in place are not immune to de-anonymisation techniques or breaches if the service itself isn’t adequately secured.

If you’re curious about how to set up a .onion domain, click the link.

Legality 101: Running an Onion service isn’t inherently illegal, but compliance matters

Here’s the good news: operating an Onion service isn’t illegal on its own. Think of it as setting up a members-only club on a side street instead of Main Street—it’s the activities conducted within that determine its legal standing, not its location.

Businesses, non-profits, and public institutions increasingly use Onion services to enhance user privacy, and some high-profile organisations, like Facebook, maintain onion mirrors of their regular sites to cater to users in restrictive regimes. However, engaging in illegal activities within the dark net, such as unauthorised content distribution or fraud, is just as prosecutable as it is on the open web.

The legal requirements for Onion services mirror those for regular websites, covering everything from consumer rights and data protection to intellectual property. Compliance is not waived by operating in the Onion space; in fact, it requires heightened vigilance given the common misconceptions about dark net immunity.

Compliance considerations: key areas to watch (and practical scenarios)

While operating an Onion service, you must be just as mindful of legal obligations as on the clear net. Here are the main compliance factors to keep in mind, along with practical scenarios illustrating how they apply in an Onion service context.

1. Transparency requirements and trading disclosures

Transparency requirements apply whether you’re on the clear net or the dark net.

If you’re trading goods or services, your Onion service should include the same identifying information required by regular eCommerce sites, such as a registered business address and customer support contact information.

Scenario: Imagine you’re operating a marketplace for digital products. Under most trading disclosure laws, you must clearly state your company’s registered address, legal identity, and basic contact details. Failing to do so risks regulatory penalties and could undermine consumer trust in your service, even in the privacy-focused onion space.

2. Advertising standards: honesty isn’t optional

Misleading or deceptive advertising is no less illegal on the dark net.

Any claims about your products or services must be clear, accurate, and fair. Selling goods through an Onion service does not exempt you from advertising standards laws.

Scenario: Suppose you’re running an onion-based store for rare books. If you advertise books as “first editions” or “limited prints”, but they’re actually reprints, you’re engaging in misleading advertising. Your onion service must comply with the same advertising regulations, meaning that any claims you make about product quality or scarcity should be verifiable.

3. Intellectual property compliance: copyright laws apply here too

Operating an Onion service doesn’t grant you a copyright-free playground.

Hosting unlicensed material, whether it’s music, film, or software, still constitutes copyright infringement.

Scenario: Say you’re running an onion forum that shares free resources for users. If your forum hosts or links to pirated software or films, you’re legally liable for copyright infringement. Copyright law applies in Onion services just as it does on traditional websites.

4. Customer identification for financial services: KYC obligations

If your Onion service facilitates financial services, such as cryptocurrency exchanges or wallet hosting, know that anti-money laundering (AML) and “know your customer” (KYC) regulations apply.

While Tor provides anonymity, financial regulations often require customer verification.

Scenario: You run a cryptocurrency exchange within the dark net, offering users privacy-focused financial services. AML and KYC laws require that you verify customer identities, which can be tricky on a network designed to protect anonymity. You might need to consider alternative verification methods, like ID tokenisation or multi-step verification, to satisfy both regulatory and privacy obligations.

5. Data protection compliance

Data protection laws extends to Onion services that handle personal data. Privacy notices, terms, and conditions should reflect data processing practices, and you’ll need to keep records of data usage.

Scenario: Picture an Onion service that allows users to store and share files anonymously. If any of those files contain personal data, data protection obligations kick in. You’re required to outline a privacy notice that explains data handling, even if your goal is to minimise the collection of identifiable data.

Balancing transparency and anonymity: tricky, but achievable

A major appeal of Onion services lies in their privacy. However, anonymity and regulatory transparency can be at odds. If you’re running a legitimate business or organisation, your Onion service should openly reflect your public site’s branding and contact information.

However, if you’re trying to remain entirely anonymous while providing a commercial service, transparency requirements may be a stumbling block, especially in jurisdictions with strict disclosure obligations. It’s crucial to carefully assess your service’s purpose and audience to determine where to prioritise transparency versus anonymity.

Duty of care: the future of regulatory oversight for onion services

There’s an ongoing discussion in regulatory circles about whether online platforms should have a “duty of care” toward users. If enacted, such laws would likely affect Onion services, especially those running social networks, forums, or user-generated content platforms. Since Onion services cannot be easily blocked by traditional DNS filtering methods, regulators may face challenges enforcing site restrictions in the dark net.

Consider the potential implications of this duty of care:

  • Onion services could face stricter obligations around user-generated content moderation.
  • Onion-based social platforms could be required to remove harmful or illegal content, despite existing on a privacy-focused network.

If legislative bodies impose a duty of care, Onion services that operate as public platforms may need to adjust their policies accordingly, especially in high-stakes sectors like finance, content sharing, or social media.

The role of AI agents and onion services: Balancing risk with innovation

AI agents are increasingly used for a variety of automated tasks, and these systems are now dipping their toes into the dark net. From chatbots to data-gathering bots, AI agents can interact with Onion services to collect data or provide responses to queries. However, their use brings both compliance risks and potential security vulnerabilities, especially given that the interactions occur within the Tor network, where tracking and securing bot activities can be challenging.

The anonymity provided by Tor doesn’t necessarily extend to AI agents, which might leave digital traces. Additionally, if AI agents are used to gather sensitive data from onion services, they may inadvertently expose themselves to cybersecurity risks, such as malware or phishing attacks, common on the dark net.

Businesses using AI to interact with Onion services must consider the potential for de-anonymisation, data mishandling, and the legal obligations that accompany automated data collection.

Final thoughts: privacy with compliance—striking the right balance

Onion services represent a fascinating evolution in online privacy, providing businesses and users with added protection from surveillance. However, it’s a mistake to view the dark net as a “legal free-for-all”. Compliance requirements apply, and organisations looking to use Onion services should be prepared to play by the rules while maximising privacy for their users.

How ITLawCo can help

  • Legal compliance audits: We’ll ensure your Onion service aligns with trading, advertising, and IP regulations so you stay compliant while operating in the dark net.
  • Data protection advisory: Our team can guide you through the requirements of applicable data protection laws, including privacy notices and data processing protocols, ensuring your service respects user privacy without violating regulations.
  • Intellectual property protection: We help you navigate copyright, trademarks, and licensing to protect your content and respect the rights of others within the Tor network.
  • Terms and conditions drafting: We craft tailored terms and conditions for your Onion service to protect your rights, define user obligations, and maintain accountability.
  • Duty of care & emerging regulation strategy: As legislation evolves, we provide insights on potential impacts, helping you stay ahead of new “duty of care” obligations and other regulatory changes.
  • Risk management and hosting agreements: We’ll review or draft hosting agreements to ensure your Onion service complies with provider policies and avoids potential shutdown risks.

Contact us today.