On November 11, 2019, the Ministry of Consumer Affairs issued the draft Consumer Protection (e-Commerce) Rules, 2019 (“Draft Rules”) that are proposed to apply to Companies conducting e-commerce business. The Draft Rules apply to e-commerce entities engaged in inventory based and marketplace model. Therefore, all e-commerce entities such as Amazon, Swiggy, Big Basket, Flipkart, etc. would be governed by these Draft Rules.
The Draft Rules require all e-commerce entities to submit a self-declaration to the Department of Consumer Affairs confirming compliance to these rules. The Draft Rules require all details of the seller, terms of contract with the seller relating to returns, refund, exchange, mode of payments, grievance redressal mechanism, etc. to be displayed on the website of the e-commerce entity. The e-commerce entities would be responsible for ensuring that the advertisements of goods or services are consistent with their actual characteristics and that the safety and health care information is duly mentioned in the advertisements. The e-commerce entity is not allowed to influence the decision of the consumers with respect to the goods or services, or falsely represent themselves as consumers and post reviews or misrepresent or exaggerate the quality or features of the goods and services.
They also have the responsibility to ensure data protection of the consumer under the Information Technology (Amendment) Act, 2008. In terms of the Draft Rules, the ecommerce entity could be held guilty for contributory or secondary liability in case of any breach by the seller. All e-commerce entities are required to provide redressal of grievances to the consumer through a Grievance Officer, whose name and contact details shall be published on the website along with the mechanism by which users can notify their complaints. The Grievance Officer is required to provide redressal of complaints within one month from the date of receipt of complaint. Such mechanism shall be converged with the National Consumer Helpline set up by the government.
The Draft Rules also mandate that e-commerce entities shall not, directly or indirectly, influence the price of the goods or services and shall maintain a level playing field. The last date for providing comments on the Draft Rules was December 2, 2019. At a time when there is growing discontentment among shopkeepers/restaurants about some e-commerce entities offering deep discounts, these Draft Rules are likely to be subject of intense debate before they are finalized.
This post has been contributed by Ms. Vaneesa Agrawal and Ms. Sankyukta Srivastav.
[DISCLAIMER: This article is for academic purpose and is solely to provide readers with general information regarding developments in Indian law. The information contained herein does not constitute legal or a professional advice.]