CONSUMER PROTECTION (E-COMMERCE) RULES, 2020 NOTIFIED

Recently, the #Ministry of Consumer Affairs, Food and Public Distribution, Department of Consumer Affairs, has notified the Consumer Protection (E-Commerce) Rules, 2020 (‘E-Commerce Rules’), vide Notification dated 23.07.2020. It is understood that #electroniccommerce includes the production, advertisement, sale and distribution of products via telecommunication networks. The Government has notified new rules for such e-commerce entities or companies and introduced new changes that need to be followed.

The new rules will be applicable to all retailers selling goods via electronic transactions on the Internet (‘e-tailers’), which are registered in India or abroad, but offering goods and services to Indian consumers. These rules shall not apply to any activity of a natural person carried out in a personal capacity that are not being part of any professional or commercial activity undertaken on a regular or systematic basis. These Rules broadly covers the duties, responsibilities and liabilities of e-tailers, following marketplace and inventory models to offer all goods and services over digital or electronic network including digital products.

Highlights of the E-Commerce Rules, 2020

  1. Display Details: It is now incumbent on every e-commerce entity to provide the following information in a clear and accessible manner on its platform, displayed prominently to its users, namely:-
  2. Registered name of the e-commerce entity;
  3. Origin of the goods and address of its headquarters and all branches;
  4. Contact details like e-mail address, fax, landline and mobile numbers of customer care as well as of grievance officer.
  1. Grievance Redressal Mechanism: Under the new rules, it is mandatory for every e-commerce entity to establish an adequate grievance redressal mechanism having regard to the number of grievances ordinarily received by such entity from India, and shall appoint a grievance officer for consumer grievance redressal, who will acknowledge the receipt of any consumer complaint within 45 hours and redresses the complaint within one month from the date of receipt of the complaint. They are also required to provide a ticket number for each complaint lodged, through which the consumer can track the status of the complaint.
  2. Cancellation Charges: It is also being notified that no e-commerce entity shall impose cancellation charges on consumers for cancelling after confirming purchase, unless similar charges are also borne by the e-commerce entity, if they cancel the purchase order unilaterally for any reason.
  3. Consent of Consumers: It is also specified in the new rules that e-commerce entities shall not record consent of its users or consumers automatically in the form of pre-ticked checkboxes. The consent of a consumer for the purchase of any good or service offered on its platform, shall only be recorded, where such consent is expressed through an explicit and affirmative actions.
  4. Price of Goods and Services: As per the E-Commerce Rules, the entities are not allowed to “manipulate the price” of the goods and services offered on their platforms to gain unreasonable profit and discriminate between consumers of the same class or make any arbitrary classification of consumers affecting their rights under the Act.
  5. Undertaking from the Sellers: The E-Commerce Rules also specified liabilities of an e-commerce entity which provides an information technology platform on a digital or electronic network to facilitate transactions between buyers and sellers. It makes incumbent upon them to take an undertaking from sellers to ensure that descriptions and other content pertaining to goods or services on their platform is accurate and corresponds directly with the quality and other general features of such good or service.
  6. Display of Sellers Information: As per Rules, it is also important for a marketplace e-commerce to display the information prominently to its users on its platform all the details about the sellers from which goods are purchase or services offered, including the name of their business, whether registered or not, their geographic address, customer care number, any rating or other aggregated feedback about such seller, and any other information necessary for enabling consumers to make informed decisions at the pre-purchase stage.
  7. For an effective dispute resolution the entities must provide the information regarding the seller on a request of a consumer in writing, after the purchase of any goods or services on its platform.
  8. Every marketplace e-commerce entity shall take reasonable efforts to maintain a record of relevant information allowing for the identification of all sellers who have been previously removed. It shall further maintain a record of such sellers who have been disabled under the Copyright Act, 1957 (14 of 1957), the Trade Marks Act, 1999 (47 of 1999) or the Information Technology Act, 2000 (21 of 2000).
  9. These Rules have also restricted the usual practice by the sellers to post good reviews about the goods or services by representing themselves as a consumer on online platforms and misrepresent about the quality or the features of any goods or services.
  10. It is also mandatory for all the sellers offering goods or services through a marketplace e-commerce entity to have prior written contracts in order to undertake or solicit such sale or offer and display on its platforms all contractual information required to be disclosed by law.
  11. The same duties and liabilities with regard to display and adherence of rules are also specified for inventory e-commerce entities. They also have to ensure that the advertisements for marketing of goods and services are consistent with the actual characteristics, access and usage conditions of such goods or services.
  12. Under the new rules, no inventory e-commerce entity will be allowed to refuse to take back goods or withdraw or discontinue services purchased or agreed to be purchased, among others, subject to various conditions.

Any e-commerce entities operating in contravention of these E-Commerce Rules shall be liable under the provisions of the Consumer Protection Act, 2019.

Lakshmi Vishwakarma

Associate

The Indian Lawyer  

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