Consumer Protection (E-Commerce) Rules, 2020

The author Aman Gaikwad is doing his B.A.LLB from Pune University. He is a second-year student. His topics of interest are Sports law and management. Apart from that, He wishes to write on the law concerning information technology.

The Department of Consumer Affairs has recently notified the Consumer Protection (E-Commerce Rules, 2020) hereinafter referred to as the 'Rules of 2020' which are made applicable to-

Key provisions of the E-Commerce Rules are analysed below:

Scope and Applicability

Save as otherwise expressly provided by the Central Government by warning, these rules will apply to:

The E-Commerce Rules also apply to entities that are not established in India but systematically offer goods or services to consumers in India.

The E-Commerce Rules specifically recognize and govern entities that are not established in India but systematically offer merchandise or services to consumers in India.

The E-Commerce Rules require such e-commerce entities to have:

• a) an organization incorporated in India, or
• b) an organization incorporated outside India which has a place of business in India, including through electronic mode, and leads any business activity in India, or
• c) an office/branch/agency outside India owned or controlled by a person resident in India. E-commerce entities should likewise choose an Indian resident as a nodal person of contact to ensure compliance with the CPA 2019.

This arrangement appears to be a move to ensure regulatory and enforcement power over foreign entities who offer products and ventures in India and is in line with a comparative grouping under the Personal Data Protection Bill, 2019, which extends its relevance to foreign entities who carry on business in India.

Further, this arrangement appears to require all existing e-commerce entities to necessarily can be categorized as one of the above categories. It isn't clear if these requirements are compelling existing entities who operate e-commerce stages, for example, limited obligation partnerships (LLPs), to convert into companies or incorporate as companies. Even though there is no clear rationale behind this move, a comparative methodology has likewise been taken in the NDI Rules. As per the NDI Rules, just companies are allowed to channel e-commerce and the definition of e-commerce entity does not include inside its ambit LLPs.

Duties of E-commerce Entities

a) Name, contact details, and address should be displayed prominently on the stage;

b) Establish consumer grievance redressal mechanisms

c) Mention the name and details of the importer for imported merchandise or services;

d) Ensure consumer consent for the purchase of products or services

e) Follow all the refunds policies as indicated by RBI prescriptions and within a reasonable period.

A customer care number and details of the officer to address customers problems should be displayed on the stage

As indicated by the Consumer Protection Act 2019 the E-commerce rules preclude E-commerce entities from doing the accompanying:

Liabilities of Marketplace E-Commerce Entities

All such entities are required to get an undertaking from the sellers that the descriptions, images and other content pertaining to the merchandise or services on their foundation is accurate and corresponds directly with the appearance, nature, quality, purpose, and other general features of such great or service.

Aside from the above, the marketplace e-commerce entity is likewise required to provide the accompanying data on its foundation in a clear and accessible manner:

In case the entity gives any differentiated treatment between merchandise or services or sellers of the same category, the same should be mentioned in the terms and conditions governing relationship with sellers on stage. Further, the marketplace e-commerce entity is required to keep up a record of all relevant data considering identification of all sellers who have repeatedly offered products or services that have been removed or access to which has been disabled under the Copyright Act, Trademark Act, or Information Technology Act.

Duties of Sellers using Marketplace Entities

Sellers offering merchandise or services through Marketplace Entities must provide specific data to Marketplace Entities, including seller entity details, price and breakup price, relevant details about the products or services offered available to be purchased by the seller including the nation of the birthplace, importer, and manufacturer details, delivery details, relevant guarantees or warranties applicable, and all other compulsory notices and data required by applicable laws.

What's more, sellers must have an earlier written agreement with the respective e-commerce entity, ensure accurate advertisements, and choose a grievance officer for timely grievance redressal. The requirement to select a grievance officer might be onerous on little or individual sellers, for example, sole proprietorships, and no exception has been provided for such cases. Sellers should likewise refrain from receiving uncalled-for trade practices, false representations, and refusing refunds as required under the CPA 2019.

Therefore, to ensure compliance with the E-Commerce Rules, Marketplace Entities should now ensure that sellers adhere to these requirements. This should presumably be possible through legally binding commitments.

Inventory E-Commerce Entity

A rule like those of sellers on the marketplace. This rule ensures that there is consistency maintained on the data which is provided to the consumer by the e-commerce entity, the sellers just as inventory holders.

Contravention

The arrangements of the Consumer Protection Act, 2019 will apply for any infringement of the arrangements of these rules.

The rules are in the correct direction to safeguard the interests of the Consumers, however, their implementation would be the biggest challenge for the government.

Conclusion

In the wake of the pandemic, e-commerce has been a blessing for all customers (when it involves meeting the everyday needs/essentials but even different vital necessities, as an example, insurance, securing an essential piece of furniture, and IT hardware to confirm unhampered work from home). However, this blessing has not been pure as everyday online tricks and uncalled-for trade practices have had the customers reel beneath the worry of exposing themselves to corrupt sellers and repair suppliers.

To counter this menace, E-Commerce Rules go leaps and limits in terms of transparency and pave the way towards a poised marketplace wherever the customers area unit intelligent and their area unit solid checks and balances to manage deceptive and unreasonable trade practices. Pertinently, the Indian e-commerce market has been witnessing unprecedented development in recent years, and an adequate restrictive regime was the necessity of nice importance to bring an energetic redressal mechanism and contour the existing framework.

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References:

a) 'The Consumer Protection | Department of Consumer Affairs | Ministry of Consumer Affairs Food And Public Distribution | Government Of India' (Consumeraffairs.nic.in, 2021) <https://consumeraffairs.nic.in/acts-and-rules/consumer-protection>

b) 'Consumer Protection (E-Commerce) Rules, 2020 - Consumer Protection - India' (Mondaq.com, 2020)<https://www.mondaq.com/india/dodd-frank-consumer-protection-act/980140/consumer-protection-e-commerce-rules-2020 >

c) Singh R, and Deo R, 'Consumer Protection (E-Commerce) Rules, 2020 - India Legal' (India Legal, 2020) <https://www.indialegallive.com/special/consumer-protection-e-commerce-rules-2020/>