E-Commerce guidelines for Consumer Protection 2019
These draft guidelines are issued for preventing fraud, unfair trade practices and for protection of legitimate rights and interests of consumers.
The guideline prescribes certain parameters to be eligible for operating an e-commerce business. For starters, it should be a registered legal entity and neither of its promoter or key management personnel should have been convicted of any criminal offence punishable with imprisonment in the last 5 years. The e-commerce entities are also required to be in strict adherence of Information Technology (Intermediaries guidelines) Rules, 2011. The payments for sale should be facilitated in accordance with the guidelines of RBI. One important guideline that forms the part of the draft which will aid in curbing the fraud is that the entities
have an onus to provide details about the sellers supplying the goods and services, including the identity of their business, legal name, address, name of the website, and their contact details. What would serve as an extra layer to ensure conformity of these guidelines is that the e-commerce entities are required to submit a self-declaration to the department stating that it follows the guidelines. Apart from above mentioned general guidelines, the draft also mentions do’s and don’ts for the e-commerce entities.
The do’s for the E-commerce entities: –
The entities are expected to maintain a level playing field and have neither direct nor indirect influence on the price of the goods or services. The draft also condemns any form of unfair trade practice or misrepresentation on behalf of an e-commerce entity.
The don’ts for the E-commerce entities: –
The draft promotes and advocates transparency in as much as it requires the entities to display the terms of contract between e-Commerce entity and the seller, ensure that the advertisements for goods and services match their actual characteristics, clearly mention the health and safety care information of the goods and services, provide information on available payment methods and most importantly ensure that personally identifiable information of customers are protected. The striking feature of the draft is that it obligates the
entities to accept refund requests of customers within a period of maximum 14 days.
Liabilities of Sellers: –
The scope of the draft is not limited to the e-Commerce entities and also requires sellers to follow certain guidelines. The rules include to provide for mandatory safety and health care warnings, be responsible for warranty/guarantee obligation of goods and services, prescribe for the facilitation of exchange, returns and refund process, providing a proper break-down of the price of the goods including charges such as delivery, postage, taxes and handling charges.
Consumer Grievance Redressal Mechanism: –
What’s remarkable about the draft guidelines are the provisions prescribing consumer grievance redress procedure. The draft makes it mandatory for e-Commerce entity to publish the name of Grievance Officer along with his contact details, who shall redress the complaints of the consumers within one month of receipt of the complaint.
The draft guidelines even though extensive have a shortcoming too as it does not address the issue of counterfeit goods in detail. It deals with the issue only to an extent where the entity on the finding of counterfeit goods need to notify the seller about the same and if the seller fails to provide evidence towards its genuineness, the entity will be duty-bound to take such goods from its platform. However, the provision doesn’t deal with whether the liability in case of counterfeit goods will be of the seller or the entity and what will be compensation for the consumers.
However, this draft is still a positive step towards the protection of interests of customers in an e-Commerce business. The suggestions/views/comments of the stakeholders on the draft guidelines are open till 16 th September, 2019.
Diya Mehta, Advocate
Associate, TvT Legal